Targeting bigger e-wallet market
TNG Digital forges ahead to drive a cashless nation
KUALA LUMPUR: The evolving digital wallet sphere will be more than just paying and receiving money in the future.
Malaysia’s e-wallet market leader TNG Digital Sdn Bhd has plans to offer financial suites such as banking, asset management and insurance products on its Touch ‘n Go ewallet app.
Newly-minted chief executive officer Ignatius Ong has high ambitions for its ewallet and plans which may propel it to be ahead of its time. He said the company aimed to provide financial services normally unavailable to the masses which could offer better benefits than conventional savings accounts.
“We’re also probably looking at lending. We’re going to be onboarding one of the big telco companies and a big chain of convenience store.
“At the end of the day, we aim to be the e-wallet that enables a conveniently cashless lifestyle for Malaysians in every touch point,” he told Starbiz in an interview.
For all of this to happen, there needs to be an ongoing engagement and education of the local market on the adoption of a cashless society.
Ong felt that this is incumbent of TNG Digital and himself to play that role, in a situation where cash remains prevalent in most retail transactions in the country.
He made it his aim to expand the ewallet merchant list beyond the big boys to include roadside nasi lemak sellers, coffee shop hawkers, market vendors and pasar malam traders where QR codes would be all that are needed for transactions.
There are currently more than five million registered users on ewallet and TNG Digital aspires to get at least 60% to 70% of Malaysians on board its platform by next year.
Asked on his opinion about the crowded e-wallet scene in Malaysia, Ong said it would enable the country to move towards a cashless society at a faster pace but it would come to a point where the market would see a consolidation of the smaller players.
There are currently around 50 e-wallet providers licensed by Bank Negara, including some inactive players.
China, which has a population of 1.4 billion people, is served by only two e-wallets – Alipay and Wechat Pay. Malaysia’s population is slightly larger than 30 million.
”It may be a bit ridiculous from a consumer standpoint. If you got 49 wallets and all have their own specific use, it makes it redundant and consumers will not reap the full benefit of it.
”I believe there would be a natural attrition, so I think probably the question is who might be the remaining players out in the field that makes sense?” he said.
Ong added that Touch ‘n Go already has a huge base of card users with 25 million cards in circulation and they are now being actively converted to e-wallets. This is done via Pay direct which pairs the card to the ewallet and through the RFID mobile fitments for vehicles.
Another approach taken by TNG Digital is through its #JOMTEKSI initiative, which has over 6,000 taxi drivers being recruited to receive payments through its ewallet.
And while some firms are offering white labelling services, it is not something on the cards for TNG Digital because the last thing it wanted to do is add on to the multiple e-wallets in the market.
”The TNG e-wallet is a strong platform and we will keep this option open should there be a certain close loop-system wallet that is tied to the company,” he said.
Ong added that the industry is performing pretty well when it came to consumer education as the big e-wallet players in the market leveraged on each other to do so.
But from another perspective, consumers might also be wrongly educated with the offering of cashbacks, which may make e-wallets unsustainable.
”I think my counterparts from other e-wallets would say it’s not sustainable. It never is because you are not generating enough money to plough back into your business.
”During this time, it’s more like an acquisition period and we are still in a bit of an acquisition mode this year. Probably next year should be where saturation comes to play.
”That’s where we should start to see more sanity in the market,” he said, adding that the company is pushing for more peer-to-peer (p2p) transfers.
TNG Digital is a joint venture between Touch ‘n Go (TNG) Sdn Bhd and China’s Ant Financial Services Group. CIMB Group Holdings Bhd owns 52% in TNG.
Ong, who had been with the airline industry for 15 years, made the jump to join TNG Digital due to his enthusiasm in pushing for a cashless society and vast possibilities an e-wallet provides.
Firefly’s FY e-wallet was after all Ong’s brainchild when he was the CEO then before his stint in Malaysia Airlines as the group chief revenue officer.