E-wallets ( or also known as Dompet Digital in Malaysia) is one of the emerging trends that we can see today in today’s world of e-commerce and space here in Malaysia. All these are considered as a key development as we can already foresee that it will transform not just how we transact money to each other, but mainly how we can pay for our products or services, both online and offline.
i.) How consumers pay money to each other?
Imagine the day or a scenario where we can easily pay our restaurant bills and transfer small bills through our mobile. Transfering money through e-wallet is faster than doing a bank transfer online.
ii.) How merchants keep the customers coming back? (Big Data + Loyalty & Rewards)
All this while, retailers or merchants do not have much details about their buyers as Malaysia is still a cash – driven society. However with the adoptation of e-wallets, we will foresee more merchants combining data, analytical and loyal technology to serve their customers and keep them coming back for more.
Does E-Wallet Providers Need License in Malaysia?
Another question that we should take into consideration is that do e-wallet or e-money services provider need their own license to operate in Malaysia?
According to Bank Negara Malaysia, their definition of an e-wallet is stated below:-
The Financial Services Act 2013 defines e-money as a payment instrument, whether tangible or intangible, that stores funds electronically in exchange of funds paid to the issuer and is able to be used as a means of making payment to any person other than the issuer.
Because of that, e-wallet or e-money services is recognized as a valid and enforceable legal tender in Malaysia. Any open – loop e-money services provider needs to obtain a license from Bank Negara Malaysia so that they money provided can be spent or transfered to any third parties apart from the provider themselves.
Note that all e- money services providers are governed by Financial Services Act 2013 and all directives, orders or guidelines on how to use the e-wallet would be under the control of Bank Negara Malaysia ( BNM).
Which E- Wallet Providers will stay in the long run?
Who will end up with the last laugh? while it may be too early to tell right now about how long e-wallets can stay in the long run. But what is for sure is that those with millions of existing customer base or user base will have an competitive advantage in the e-wallet infinity war.
Who Are the E- Wallet Providers In Malaysia?
AEON Wallet – Known to be one of the biggest retail groups in Malaysia with over millions of existing AEON members where you just need to pay RM12 per year for paid loyalty program. They have ties with Visa Prepaid Card developed by Aeon Credit Service and they are usually recruiting new users via brick – and – mortar services.
Boost – An e-wallet by Axiata Group that started from scratch currently has a large user base of 3.3 million with 50,000 touch points and supported by over 10,000 cab drivers. Boost currently has one of the greatest marketing tactics among other e-wallets in Malaysia and what is so unique about their services is that people love their shake rewards for each transaction made. Furthermore, Boost has also got a partnership with UnionPay International ( UPI) in July 2018 and users will be able to make their payments using UnionPay cards.
There are still many more e-wallets in existence today in Malaysia. However, with all that being said, are Malaysians ready to eventually adapt into e-wallets when our society is still heavily driven by cash, credit cards and debit cards? A study also shows that not many US citizens are also adapting to e-wallets and some of the reasons have to do with the security of the ecosystem.
We all know that China is our main benchmark in leading the world into digitization. However will the rest of the developing nations including Malaysia follow suit? Let us know in the comments down below.