SMEs set to gain from e-payment

  • SME
  • Friday, 14 Feb 2014

KUALA LUMPUR: Small and medium enterprises (SMEs) stand to gain from a shift to e-transactions in their everyday business, given the convenience and minimal human error.

Association of Banks in Malaysia (ABM) executive director Chuah Mei Lin said running their businesses through electronic platform would be cost-efficient for SMEs in the long term, even though banks charged a fee for the cash management services provided.

She was responding to concerns that SMEs will still have to fork out a sum for cash management services fee, which on the surface made the 10 sen charge on e-transactions no more attractive than the 50 sen cheque processing fee beginning April 1.

She said there was no fee to maintain an account for e-transactions but banks charged for providing payment and collection solutions.

“These charges are in tandem with the volume and type of work done for the banks’ customers,” she said, adding that the amount SMEs paid their banks were based on negotiated packages and deals.

“It can be as low as RM100 per month or banks can work out an annualised fee, but this all depends on the banks and the relationship with their customers,” she told the media.

With interbank GIRO fund transfers, businesses would not need to worry about bounced cheques, lost or scrapped cheques, and fraudulent cheques.

She added that electronic payments also contributed to a more efficient economy as it saved on the subsidisation costs for cheques. This would mean 1% savings on the gross domestic product annually.

Chuah said that there had been a positive take-up rate of interbank GIRO fund transfers so far, with about 60% to 70% take-up rate at ABM’s roadshows. “Most larger businesses have adopted e-transactions, only the remnants of small and medium businesses are left to move over.”

Based on the targets set in the Financial Sector Blueprint, Bank Negara aims to raise e-payment transaction per capita to 200 by 2020. In 2012, each Malaysians made an average of 56 e-payments.

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