KUALA LUMPUR: Managepay Systems Bhd (MPay) is looking to capture 10% to 15% of the 1.2 million card acceptance devices to be installed over the next five years, with its new Chip & Pin technology solution, making it the first MyClear certified contact and contactless chip & pin card host and terminal solution to be launched in Malaysia.
MyClear, which builds and operates payment systems and financial market infrastructure, is a wholly-owned subsidiary of Bank Negara.
In pushing Malaysia into a cashless society, the central bank is looking to increase card terminals from 220,000 at present to 800,000 over the next five years.
The 800,000 terminals roughly translates to 1.2 million card acceptance devices.
Bank Negara aims to centralise all current cardholder verification methods to Chip & Pin, from Chip & Sign previously by Jan 1, 2017.
In line with Bank Negara’s vision, MPay is now ready to support them with its latest technology innovation – MPay Chip & Pin payment solution.
“By the first quarter of next year, we will likely see more Chip & Pin and contactless products flooding the market,” said MPay managing director and chief executive officer Chew Chee Seng said
“In moving to a Chip & Sign method, three things are needed: the host, the terminals and the cards itself. With our solution today, we are able to provide the host and the terminals.
“Our target is to sell our host to small banks with less than 1 million cards. We have been talking to many banks, not just local ones, but outside Malaysia like in IndoChina,” he said.
Mpay Technologies Sdn Bhd chief executive officer Ng Kian Seng said that Mpay’s new technology will significantly cut down the cost of of small business owners to acquire terminals.
This is because the chip & pin solution supports omni-channel output such as on-premise payments, on the go payments, and is virtually compatible with all smart phones in the market. These will help facilitate ease of payment.
Acquirers are financial institutions or third-party agents such as Mpay that provide payment terminals to the merchants.
Chew also sees opportunities in third-party acquiring. For example, many foreign banks aren’t in the business of acquiring merchants, but only issue cards. Hence it is very likely that the foreign banks will be the ones that will require TPA services.
A TPA owns the merchant relationship and therefore signs up the merchants in its own right, including performing credit and risk assessment.
The role of receiving and handling the sales proceeds still falls with the sponsor bank.
MPay Chip & PIN is set apart from other payment systems available in the market, as it also offers back office reconciliation processing and is compliant with the Personal Data Protection Act (PDPA) and Payment Card Industry Data Security Standard (PCIDSS)
Mpay shares have attracted quite some investor attention lately. Its recent private placement attracted investors such as former Hong Leong Financial Group Bhd CEO Datuk Yvonne Chia and Fajarbaru Builder Group Bhd chairman Tan Sri Kuan Peng Ching @ Kuan Peng Soon.
The placement entails an issuance of up to 175.71 million shares, which represents 30% of its existing issued and paid-up share capital to third party investors at an issue price of 23 sen.
Chia subscribed for 20 million shares, while Kuan subscribed for five million shares.
Other investors include ConnectIoT Sdn Bhd that subscribed for 13.8 million shares, RedGiant Analytics Asia Sdn Bhd 26.47 million shares, Andrew Chia Wei Jun 12 million shares, Chu Hong Keong eight million shares, Chin Chee Thoy 20 million shares and Soon Kian Heng 15.55 million shares.