Card payments in Malaysia to hit RM387bil this year, says data firm


  • Nation
  • Tuesday, 02 Apr 2024

PETALING JAYA: The move towards a cashless society is expected to see Malaysians use their credit and debit cards to spend some RM387bil this year, according to a data and analytics company.

UK-based GlobalData estimated that debit card usage will account for RM156.4bil of this figure while the remaining RM230.5bil will be through credit cards.

“Malaysia is gradually moving towards the digitalisation of payment infrastructure, supported by a growing banking population and a developing point-of-sale (POS) infrastructure.

"Although cash remains prevalent in Malaysia, it is gradually losing ground to electronic payments.

"Consumers are increasingly turning to payment cards, a trend that has accelerated in the wake of the Covid-19 pandemic," Globaldata's senior banking and payments analyst Poornima Chinta said in a statement on Tuesday (April 2).

The study found that card payment value in Malaysia registered a healthy compound annual growth rate of 14.3% between 2019 and 2023, reaching RM351.2bil last year.

Based on projections, spending via debit and credit cards among Malaysians is projected to rise to RM422.5bil next year, RM459.2 bil in 2026, RM496bil in 2027 and a whopping RM533.1bil by 2028.

The study noted that growth in card payments in Malaysia has been supported by improvements in POS infrastructure and government initiatives to push cashless payments.

"In 2022, Malaysia launched a campaign promoting cashless payment alternatives for all governmental transactions.

"Under this programme, government agencies were equipped with adequate payment infrastructure, enabling consumers to utilise various digital payment methods, including debit/credit cards, digital wallets and internet banking, to settle payments for services like utility bills, fees and taxes," the statement noted.

Also pushing growth was the move by Bank Negara to reduce the interchange fees to encourage merchants to accept card payments beginning Jan 1 last year.

This included capping interchange fees for domestic and international debit cards at 0.10% and 0.27%, respectively, and at 0.6% for credit cards.

"Contactless payments are also gaining traction in Malaysia, contributing to the increase in the number of payment cards.

"According to Bank Negara, 68.9% of card transactions at physical premises were contactless in 2022, up from 64.6% in 2021," the firm's analysis revealed.

It also showed that credit and charge cards accounted for 60.7% share of the overall card payment value last year while debit cards accounted for the remaining 39.3%.

Globaldata also found that although debit cards are traditionally preferred for cash withdrawals, they are now increasingly being used for payments, particularly low-to-medium value transactions.

The change in usage pattern is said to be driven by rising consumer awareness, banks offering contactless debit cards, and the expansion of the country’s POS network.

Chinta said Malaysia’s payment card market is expected to continue its upward growth trajectory and grow at a compound annual growth rate of 8.3% between this year and 2028.

Follow us on our official WhatsApp channel for breaking news alerts and key updates!
   

Next In Nation

Azmin called up over leaked PKNS documents, not remarks at state assembly, say cops
PM announces rationalisation of diesel subsidy
Anwar to make three-day working visit to Japan
Hardware store probed for allegedly selling nails at 20sen each
Robber who slashed moneylender in Kudat nabbed
Exhibition on Hang Tuah boosted by artefact loan from Indonesian heir
Mohamad Sabu to represent country at Iranian President Ebrahim Raisi's funeral, says Anwar
Broken pipe being repaired on Jalan Tun Razak, says Air Selangor
Man feared drowned after being swept away on boat in Kinabatangan river
Man charged with obstructing cop on sentry duty at Penang police station

Others Also Read