KUALA LUMPUR: Bank Negara Malaysia (BNM) has refined several entry requirements for digital insurers and Takaful operators (DITOs) in its policy document on licensing and regulatory framework for DITOs released today.
The centre bank said under the refined entry requirements, DITOs will observe a foundational phase over a period between three years and up to seven years to demonstrate their viability and operational soundness.
"DITOs will also be accorded a lower minimum paid-up capital during the foundational phase to be more proportionate to DITO’s business operations at their initial stages," it said in a statement today.
Apart from that, BNM said DITOs are characterised by their digital operations, with innovative business models and products to better meet consumer needs.
"Once in operations, DITOs are envisioned to close critical protection gaps in digitally-focused segments alongside existing insurers and Takaful operators (ITOs) and other players in the insurance and takaful value chain," it said.
According to BNM, the refinements were made after taking into account feedback and insights from various stakeholders, and are in line with the Financial Sector Blueprint 2022-2026 strategic thrust to advance the digitalisation of the financial sector.
"BNM will issue licences to applicants who can successfully demonstrate their capacity and capability to achieve the intended policy outcomes, while still preserving a strong focus on risk management and consumer protection,” it said.
Interested applicants are invited to submit formal applications to BNM between Jan 2, 2025 and Dec 31, 2026.
Meanwhile, in a separate statement, BNM said it received encouraging interest from various parties in submitting applications for DITO licences in just three months into the start of the two-year application window.
"‘With DITO, BNM hopes to further strengthen the financial system with more inclusive, competitive and efficient offerings in line with the evolving needs of consumers," said BNM Governor Datuk Seri Abdul Rasheed Ghaffour.
BNM said all interested applicants must secure consultation sessions with BNM by emailing DITF@bnm.gov.my before submitting a formal application, and applicants must meet the criteria outlined in the Policy Document on Licensing and Regulatory Framework for DITOs. - Bernama
