Charge for online instant transfer to be waived next year

The RM0.50 charge imposed on instant online fund transfers will be waived starting next July 1.

According to Bank Negara Malaysia (BNM), this is to encourage more parties to use digital payment methods instead of cash.

However, the waiver will only be applicable for fund transfers amounting to RM5,000 or less, made by individuals as well as small-and-medium enterprises (SMEs).

In addition, the central bank will also increase the current cheque processing fee from RM0.50 to RM1 effective Jan 2, 2021.

BNM Governor Tan Sri Muhammad Ibrahim said, it is time for Malaysia to accelerate its transition from cash to digital.

"We must embrace the next wave of technological and e-payment transformation. As a nation, we need to rise and seize this exciting opportunity, take a proactive rather than reactive role.

"We need to bereft ourselves of the inertia to move forward with the times," he said while delivering the keynote address at the 2017 Payment System Forum and Exhibition here today.

Muhammad said, by accepting payments via debit or credit cards, Malaysian businesses had saved a total of RM422.4 million from 2015 to September this year.

He also reiterated the importance of Malaysia doing away with cheques as a mode of payment.

"Our study shows that the unit cost for cheque processing by banks has increased from RM3 in 2011 to RM4 in 2016, and is estimated to be RM6 by 2020.

"At 120 million cheques currently, this translates into an enormous cost of RM484 million, a sheer wastage to the economy," he said.

The 2017 Payment System Forum and Exhibition gathered industry experts in the technology and financial sectors, including Malaysian-born Lau Seng Yee, chairman of Group Marketing and Global Branding of one of China’s biggest conglomerates, Tencent Holdings Inc.

Lau is known as the Malaysian who took China by storm, and was the first exec from a Chinese company to receive the Cannes Lions Media Person of the Year Award in 2015.

“The topic of digitalisation is not something new, but why has it become such a huge phenomenon globally in just a short period of time?" said Lau in his presentation.

He said in its pivot to become a digital economy, Malaysia can learn a lot from China and embracing mobile payments is one of the most important lessons to learn.

"(Mobile payment) definitely plays a key leading role as dynamic force that penetrates and then transforms the entire economic ecosystem of China," he said.

Lau said in 2016, the volume of mobile payments made in China was 11 times that of the United States, while the country also accounted for 42.4 percent of global e-commerce last year.

"The role of payment is now beyond just a financial transaction, but carries a stronger social connotation."

Lau outlined five key things Malaysia needs to learn before mastering the digital economy.

They include to not jump into the "digitalisation bandwagon" without adequate expertise, using technology as both a driver and a guardian, believing in the value of a joint-effort ecosystem, and finding the country's own unique digital journey and not to absent-mindedly emulate others.