Accelerating the migration to electronic payments is a key part of Malaysia’s Financial Sector Blueprint, which charts the direction of the financial system over the next ten years. And according to Visa’s Consumer Payments Study latest findings, more than seventy percent of Malaysians are supportive of the country going cashless and 62 percent believe it can be achieved within the next five years.
Furthermore, the study also showed that 69 percent of Malaysian respondents are planning to use cashless payment methods more often, and move away from cash.
The top reasons for the potential increase in digital payments usage are due to convenience and wider acceptance of digital payments in the country.
Consumers believe a cashless society offers include tracking financial records easily, removing the hassle of having to queue at banks, and enabling the country to become more efficient.
“It is heartening to see the increase in digital payments usage by Malaysians in the country, especially contactless payments. This is aligned with our data, where close to half of all Visa face-to-face payments are contactless payments,” Ng Kong Boon, Visa Country Manager for Malaysia said.
Meanwhile Ng also pointed out that Malaysia is one of the fastest growing countries in Asia Pacific in terms of contactless penetration, and they are confident this growth will continue as they expand into new merchant category segments.
In addition, nearly two in five respondents stated that they are carrying less cash compared to two years ago. Sixty nine percent of respondents cited this was due to more merchants adopting cashless payments, while 65 percent indicated it was due to safety concerns when carrying cash.
In Malaysia, contactless card payments are also gaining momentum, and based on the study, 65 percent of respondents have used contactless payments, and 85 percent of them make contactless payments at least once a week.
“Despite the growth in digital payments usage, there are still tremendous opportunities in Malaysia for cash displacement,” Ng said, adding that they are seeing a proliferation of various payment solutions being introduced to Malaysia, which may accelerate the use of digital payments.
“However, it may also cause the payment industry to be more fragmented so it is crucial for us to work closely with the banks, merchants and FinTech community to ensure the solutions we’re creating are interoperable so it can drive greater adoption amongst Malaysians,” Ng said.
Malaysians believe that contactless payments enables them to not carry cash around and is a faster payment mode compared to other solutions.