MANY Malaysians are not able to withstand financial shock.
55% out of 1,424 Malaysians have less than RM10,000 in available savings to fall back on in times of need, according to a study conducted by Perbadanan Insurans Deposit Malaysia (PIDM) and the Behavioural Insights Team (BIT).
The yearly celebration of World Savings Day (Oct 31), which aims to raise awareness on saving money, is therefore a prudent reminder on the necessity of savings – especially with the cost of living steadily increasing amidst a backdrop of rising inflation and a possible global economic recession.
In the hope of providing every Malaysian an equal opportunity to enjoy a better life, Bank Simpanan Nasional (BSN) as a development financial institution has been involved in promoting the development of savings, through a range of financial products and services, since its inception.
“The commitment to encourage Malaysians to save is imminent and BSN will continue to invest and introduce more products and services to ease the banking needs of Malaysians,” says BSN chief executive Jay Khairil on the importance of cultivating the savings habit.
“Our core mandate is still about encouraging more Malaysians to save. That hasn’t changed in any way. But we have to diversify and also make the products more interesting to continue being relevant in the savings platform, so what has changed is the way we deliver our services,” he shares.
This is amply reflected in the flagship BSN Sijil Simpanan Premium (BSN SSP), which is one of the revolutionary products that BSN has pioneered and has strong roots in.
For adults, the BSN SSP is about driving hope through a draw campaign whereby one depositor stands a chance to become a millionaire each month.
For youngsters, it is adapted into the young savers’ programme in schools, where students’ participation in academic and co-curricular activities – and most importantly, the growth in their savings – contribute to an overall yearly score in a savings competition that is held at district, state and national levels.
“A lot of our savings products are catered around this level of sophistication to make them more interactive and we do a lot of campaigns around them to bring about awareness on saving and make it appealing,” says Jay Khairil.
Among the other initiatives taken to inculcate a saving habit among young Malaysians are targeted products such as the Program Insentif BSJ, BSN Smart Junior, BSN MyFirst and BSN Cashless programme.
BSN’s mandate in encouraging savings ties seamlessly into the nation’s financial inclusion agenda of “no Malaysian left behind”.
“We have to start inculcating the saving habit among Malaysians from young, by making sure they have access to financial services, know-how and eventually, financial well-being.
“We also have to ensure that we serve all layers of society across the country, including sectors and segments that are underserved and unbanked,” he says.
As Malaysia moves towards a cashless society, the bank must maintain its distribution network and footprint to remain close to communities while it embarks on its journey of digital transformation.
BSN serves the nation through its 390 branches and 2,700 agent banks, as well as the mobile bank branches in Sabah and Sarawak. The bank also has new mobile bank branches in the works in Kelantan, Pahang and Sarawak.
Under the first two years of BSN’s five-year corporate strategic plan, the key focus for the bank’s digital transformation is to strengthen its core by first digitising its operations and processes for more capability and scalability, to ensure that it is fully ready at the back-end to offer front-facing solutions to its customers.
“While many others are jumping into the digital foray, we have to make decisions that are deliberate to serve all demographics and every segment of the population,” says Jay Khairil, noting that there remains a considerable gap when it comes to the availability of infrastructure in urban versus rural areas.
Beyond infrastructure, however, there is also a digital divide that the bank has to address.
“As we move towards the digital future, we have to leave no one behind while we migrate the behaviour of our customers and employees through a very structured and systematic process with a hybrid approach.
“It’s about going to these remote areas and enabling them not just from an infrastructure perspective, but education as well,” he says.
The rationale behind taking such a careful, holistic approach is that the financial inclusion agenda, for BSN particularly, must come hand-in-hand with financial literacy, which is becoming increasingly important with the growth of the digital economy and the rise of scams and frauds.
“If we’re able to do that, I think we can bring about the culture of saving among Malaysians,” he says.