A detailed overview of the cards, payments and consumer banking industry in Malaysia, with expert comments supported by accurate data. Despite the rapid increase of digital payment methods, especially contactless (to the detriment of cash but the benefit of debit card and QR code payments), there remain many payments to be migrated to digital, signalling a golden opportunity to enter the Malaysian market.
The possibility is all the more lucrative with Citi's consumer-facing operation on the verge of pulling out, opening up the chance to claim a large slice of the market via the acquisition of that portfolio. At the POS, QR is becoming popular, to the point that it may threaten cards over the next five to ten years; DuitNow, an interoperable QR system, was introduced in 2019.
There are opportunities also in an acquiring market that is currently dominated by local players, suggesting that foreign entrants could bring downward competitive pressure to margins.
TABLE OF CONTENTS
Demographics and the economy
Key retail banks and issuers
Acquiring and processing
Regulatory and other cards market information
Appendices: Malaysia Payments Data Tables
Appendix I: Demographics and the economy
Demographic and economic indicators
Data table 1: Demographic and economic indicators: 2015-2020. Forecasts to 2024.
Data table 2: Ownership of key consumer devices: 2015-2020. Forecasts to 2024.
Data table 3: Internet usage by population: 2015-2020. Forecasts to 2024.
Appendix II: Payments environment
Data table 4: Access points: 2015-2020. Estimates to 2022.
Data table 5: Account penetration: 2015-2020. Forecasts to 2024.
Data table 6: Consumer payment: trends 2015-2020. Forecasts to 2022.
Data table 7: B2C e-commerce payment methods: 2015-2020. Forecasts to 2022.
Appendix III: Cards market
Data table 8: Total cards payment metrics: 2015-2020. Forecasts to 2024.
Data table 9: Contactless cards metrics: 2015-2020. Forecasts to 2024.
Data table 10: Credit card numbers: 2015-2020. Forecasts to 2024.
Data table 11: Total credit cards metrics: 2015-2020. Forecasts to 2024.
Data table 12: Credit cards profitability indicators: 2015-2020. Forecasts to 2024.
Data table 13: Debit cards numbers: 2015-2020. Forecasts to 2024.
Data table 14: Debit cards metrics: 2015-2020. Forecasts to 2024.
Data table 15: Prepaid/e-money cards metrics: 2015-2020. Forecasts to 2024.
Appendix IV: Mobile payments
Data table 16: Mobile proximity payment metrics: 2017-20. Forecasts to 2024.
Appendix V: Profit pool
Data table 17: Malaysia market profit pool: 2015-20. Forecasts to 2024 including credit card numbers, billed volumes, outstandings, interest incomes, net interest revenues, merchant revenues, card fee revenues, other non-interest incomes, total revenues, net credit losses, operating expenses, total expenses, pre-tax profits, merchant service charges, rollover rates, APR, net credit losses to outstandings, operating costs to revenues, ROA (pre-tax profits to outstandings).
Appendix VI: Card networks
Data table 18: Networks' credit card market shares: 2015-20. Forecasts to 2022.
Data table 19: Networks' credit card data numbers: 2015-20. Forecasts to 2022.
Data table 20: Networks' credit card billed volume: 2015-20. Forecasts to 2022.
Data table 21: Networks' number of credit card transactions: 2015-20. Forecasts to 2022.
Data table 22: Networks' average credit card transaction value: 2015-20. Forecasts to 2022.
Data table 23: Credit card interchange fees by network: 2015-20. Estimates for 2021.
Data table 24: Networks' debit card market shares: 2015-2020. Forecasts to 2022.
Data table 25: Networks' debit card data numbers: 2015-2020. Forecasts to 2022.
Data table 26: Networks' debit card billed volume: 2015-2020. Forecasts to 2022.
Data table 27: Networks' number of debit card transactions: 2015-2020. Forecasts to 2022.
Data table 28: Networks' average debit card transaction value: 2015-2020. Forecasts to 2022.
Data table 29: Debit card interchange fees by network: 2015-2020. Forecasts to 2022.
Data table 30: Debit card interchange fees by MyDebit: 2015-2020. Forecasts to 2022.
Appendix VII: Key retail banks and issuers
Data table 31: Key credit card issuers market shares by credit card numbers: 2017-2020. Forecasts to 2022.
Data table 32: Key issuers market shares in credit card outstandings: 2017-2020. Forecasts to 2022.
Data table 33: Key debit card issuers market shares by debit card numbers: 2017-2020. Forecasts to 2022.
Appendix VIII: Acquirers and processing
Data table 34: Merchant acquirer credit card market share: Estimates for 2021.
Data table 35: Credit card merchant service charges: 2015-2020. Forecasts to 2024.
Data table 36: Merchant acquirer debit card market share: Estimates for 2021.
Data table 37: Debit card merchant service charges: 2015-2020. Forecasts to 2024.
Data table 38: Credit card issuer/issuing processor relationships
Data table 39: Credit card acquirer/acquiring processor relationships
Data table 40: Credit card issuing processor market shares by card numbers: Estimates for 2021.
Data table 41: Credit card acquiring processor market shares by the number of POS transactions: Estimates for 2021.
Appendix IX: Online acquiring
Data table 42: Online merchant acquirer market share. Estimates for 2021.
Demographics and Economy:
Malaysia is predicted by the World Bank to become a high-income country with a gross national income (GNI) per capita of $12,535 between 2024 and 2028.
Malaysia remains a largely cash-based society with cash in circulation equivalent to 8.5% of nominal GDP in 2020. However, the pandemic has accelerated the uptake of digital payment methods that would otherwise have taken several years.
There were 170.2 million payment cards in the country at the end of 2020 (including credit cards, charge cards, debit cards and e-money cards), a 23% increase over the year before.
Malaysia has a vibrant mobile payments market with a wide range of banks and e-money issuers competing. Central bank BNM is actively supporting the development of the market through liberal e-money regulation.
As in many other markets, industrywide pre-tax profitability decreased in Malaysia during 2020, in its case by around 19.5%. Credit card purchase volume declined by 12.5%.
Malaysia has a competitive credit cards market, with all of the usual major international brands present – Visa, Mastercard and American Express. There are three debit card networks operating in Malaysia: Visa, Mastercard and domestic network MyDebit.
Key Retail Banks and Issuers:
The Malaysian credit cards market is very competitive, with 27 credit cards issuers serving a population of 33 million, of which only around a fifth hold a credit card.
Acquiring and Processing:
Malaysia's merchant acquiring market is highly competitive, with most issuers offering acquiring services. Processing in this market is mainly carried out in-house. The main acquirers and the majority of the leading issuers are domestic players.
The B2C e-commerce market in Malaysia was worth around $6 billion during 2020, which was almost three times greater than in 2015. Verisk expects B2C e-commerce sales to grow to almost $10 billion by 2022.
Regulatory and Markets Information:
The Malaysian Financial Services Act 2013 (FSA) and Islamic Financial Services Act 2013 (IFSA) together provide a unified legislative framework governing the supervision and conduct of financial institutions in Malaysia.
Association of Southeast Asian Nations
Bank Islam Malaysia
Bank Negara Malaysia
CIMB CNY Go Digital
CIMB Thai Bank
Direct Debit System
EONCAP Islamic Bank
Financial Process Exchange
Hong Leong Bank
Hong Leong Connect
HSBC Amanah Malaysia
Industrial and Commercial Bank of China
Malaysia Digital Economy Corporation
Malaysia Electronic Payment System
Malaysian Electronic Clearing Corporation
MIMB Investment Bank
National Electronic Cheque Information Clearing System
Payments Network Malaysia
Pine Payment Solutions
Razer Merchant Services
Real-Time Retail Payments Platform
Retail Payments Platform
Shared ATM Network
Touch 'n Go
United Overseas Bank
Universiti Malaysia Terengganu
World Trade Platform
Verisk financial reports include detailed market and competitor intelligence on payments cards, e-money, acquiring, retail banking, and consumer credit in the Asia Pacific region. Analysts use primary and secondary source data and conduct in-depth interviews with senior industry executives and finance experts.
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