BRIGHT PROSPECTS FOR E-WALLETS
Growth boosted by government incentives, Asean consumer market
THE growth trajectory of e-wallets in Malaysia is bright, boosted by government incentives such as the eBelia, ePenjana and eTunai initiatives, Kenanga Research said.
This will also be fuelled by the consumer market in Asean, with cash transactions expected to reach US$4 trillion by 2030.
Kenanga Research said the government’s recently-launched Malaysia Digital Economy Blueprint would expedite the development of the local digital economy to make Malaysia a regional leader.
As such, the blueprint includes strategies on accelerating digital payment in Malaysia. For instance, the first thrust of the blueprint requires all federal and state level agencies to offer digital payment services by next year, making it a preferred method of transaction.
“Last year spurred the adoption of e-wallets among Malaysians as a combination of government financial incentives and Covid-19 restrictions that encouraged more Malaysians to forego cash for cashless transactions.
“Moreover, to encourage the adoption of e-payment for both merchants and consumers, the government will endorse e-payment onboarding programme by incentivising both parties to use e-payment,” Kenanga Research said following its meeting with GHL Systems Bhd group chief executive officer Sean S. Hesh and Merchantrade Asia Sdn Bhd chief strategy officer Rafidz Rasiddi.
The firm added that last year, the government had rolled out the eTunai initiative for eligible Touch ‘n Go e-Wallet users to claim RM30 as a method to encourage the adoption of e-wallets across Malaysia.
Kenanga Research said e-wallet platforms had a simple onboarding process and could be used immediately upon registration, thus, prompting a rapid growth in users shifting to e-wallets.
As of 2019, Malaysia’s mobile cellular penetration stood at 135.4 per cent, indicating that a huge majority of Malaysians own a mobile phone and can easily download the various e-wallet applications available in the market.
“With the Malaysian government and regulators incentivising the public to promote a cashless society, coupled with e-wallet players providing users with various promotions and cashbacks, more consumers will be encouraged to download and use these platforms.”
Kenanga Research said in order to remain competitive and appealing to the public, e-wallet players are constantly upscaling their platforms by increasing the functionality of their e-wallets.
“Therefore, e-wallets can now provide consumers with a range of services from buying insurance to flight tickets. Overall, this demonstrates the growing potential of e-wallets in Malaysia.”