Central bank of Malaysia suggests move to e-payment could save 1% GDP

Bank Negara Malaysia (BNM), the country's central bank since 1959, is encouraging small businesses to migrate to e-payments.

Bank Negara Malaysia (BNM), the country’s central bank since 1959, is encouraging small businesses to migrate to e-payments.

Tan Nyat Chuan, director of the payment system policy department, opined that a successful move away from traditional payment methods toward e-payments could save 1% of the country’s GDP.

The announcement was made at an educational road show led by the Association of Banks in Malaysia that aims to encourage online banking services, particularly Interbank-Giro (IBG).

Chuan revealed that though 74% of bank account holders have access to internet banking, only 43% of the users conduct digital financial transactions.

"In this regard, we have not reached a stage where the masses are familiar or have gained sufficient trust in using Internet banking to conduct their financial transactions."

He expressed a hope that through the road show, customers and businesses alike would "learn more about the security safeguards and safe practices".

BNM started encouraging customers towards e-payments in March 2013 by introducing favourable prices for digital payment services.

The transaction fee for IBG is now MYR10 ($3) whilst the fee for cheques will be raised to MYR50.

BNM hope to increase the number of electronic payments per capita from 56 in 2012 to 200 by 2020 and to reduce the number of cheques cleared in the country by half from 204m to 100m in the same period.