Bank Negara's FinTech rules almost ready

Bank Negara Malaysia deputy governor Datuk Muhammad Ibrahim : "We have now reached a critical juncture in our migration to e-payments.

KUALA LUMPUR: Bank Negara Malaysia's (BNM) guideline on financial technology (Fintech) is almost ready to be finalised, said Governor Datuk Muhammad Ibrahim.

 "Our concept paper is almost ready to (be) finalised because we have received feedback from the industry. So, we will finalise it and it will become a guideline for financial institutuions.

"We are quite happy that we are able to do it within the time that we stipulated," he told reporters after delivering his opening remarks at the Global Symposium on Innovative Financial Inclusion here on Wednesday.

Muhammad was previously reported as saying the regulatory framework for Fintech was expected to be released by the final quarter of this year.

Fintech is a type of service provided by internet companies that streamlines financial systems and makes funding of the supply chain more efficient.

He said today Fintech, which has transformed the landscape of the financial sector, is the enabler to financial inclusion. 

"I think if we use Fintech, the cost of delivering financial inclusion to our people will be much lower, more effective and efficient," he said.

Earlier in his speech, Muhammad said a framework for evaluating financial inclusion efficiency could provide powerful incentives to harness technology in the most optimal way.

This should drive down the costs of delivering inclusive financial services over time and thereby enhance the viability for both the governemnt and private sectors.

Meanwhile, the World Bank Group Director for Finance and Markets Global Practice, Sebastian Molineus, today called on banks and other well established financial institutions to actively harness technology to enhance product offerings and improve efficiency.

He said the growing usage of Fintech, which has the potential to deliver a more resilient financial infrastructure as well as more effective trade and settlement, has opened up new forms of competition for banks and other incumbent financial institutions.

Molineus said Fintech would continue to challenge traditional financial institutions and even bring risks and challenges to the industry going forward.

"Fintech can disrupt financial markets positively, bringing benefits arising through competition, efficiency gains and lower costs. Or it can be a source of increased risks for stability, integrity and market conduct," he added. - Bernama