Global FinTech Guide
Country Name
Payment services
FinTechs belonging to this category offer alternative payment services which are supposed to provide a faster and cheaper way for national, European, and international payments for private and business customers by using new technologies.

For example, payment service providers hereby offer solutions to easily integrate several payment services in online shops.

Some FinTechs furthermore provide real cash register systems and online-reservation solutions for restaurants and shops providing their own payment services or making use of the payment services of FinTechs described above.


Attitude of the country towards modern payment services

The general public is receptive of the development within this segment in such that the Malaysian society is becoming less reliant on cash and is more inclined towards modern payment services. The regulators are also known to be supportive of the developments within this segment. There is a preference for modern payment services such as mobile banking. Electronic money (“e-money”) has also increased in popularity as the preferred method of payment in the past few years following the pandemic to avoid or minimise physical contact and given the rise of e-commerce.

Legal affairs

Obligations and requirements to provide payment services or ancillary services described above

Payment services are regulated by the Central Bank of Malaysia (“BNM”) which formulates the regulatory framework via the Financial Services Act 2013 (“FSA”) to ensure the safety, reliability, and efficiency of payment systems infrastructure in Malaysia. Operators of payment systems or issuers of a designated payment instrument (i.e. e-money) are required to obtain approval from the BNM.

Applicants for e-money issuers must have a minimum share capital of RM100,000 (for small scheme) (approximately USD22,730) or RM 5 million (for large scheme) (approximately USD1,136,500) and must be able to demonstrate, among others, the feasibility and viability of the proposed e-money business, including target market and potential demand supported by projected cash flow of at least three (3) years. 

To support the growth of innovative payment solutions in Malaysia, including credit transfer services through mobile devices, the BNM has issued the Interoperable Credit Transfer Framework (“ICTF”) which seeks to enable interoperability of credit transfer services among financial services providers in Malaysia using shared payment infrastructure. The ICTF is applicable to financial services providers in Malaysia, in particular the providers of payment services in Malaysia including the operator of a shared payment infrastructure.

The ICTF outlines requirements aimed at:

    a) enabling interoperability of credit transfer services leveraging on shared payment infrastructure to expand network reach and avoid market fragmentation;
    b) ensuring fair and open access to shared payment infrastructure to promote a level playing field and foster collaboration at the infrastructure level;
    c) facilitating effective oversight of shared payment infrastructure to maintain the safety and integrity of credit transfer systems and to ensure the integrity and stability of the financial system;
    d) encouraging innovation through the establishment of innovation sandbox facilities and publication of Application Programming Interfaces (APIs) by an operator of a shared payment infrastructure;
    e) establishing risk management measures proportionate to the nature, scale and complexity of the activities and risk profile of the respective providers of credit transfer services; and
    f) strengthening customer protection and fostering confidence in the use of credit transfer services.

In essence, through the provision of interoperable credit transfer services by financial services providers in Malaysia using shared payment infrastructure, consumers have the option to transfer money from one (1) digital wallet to another, from one (1) bank to another digital wallet and vice versa through the use of mobile devices as a convenient alternative to cash and cheques.

The expenditure for the legal compliance is considered average.

Additional comments regarding the legal situation for payment services or what FinTech’s must be aware of in this business area

On June 2020, BNM published the Risk Management in Technology (“RMiT”) policy document which sets out the minimum standards that must be complied with by, among others, approved issuers of e-money and operators of a designated payment system in implementing sufficient risk management practices and controls that commensurate with the increased technology risk exposure.

Economic conditions

Market size for payment services and biggest payment service providers

Statistics provided by BNM reports that there were over 200 million e-money transactions valuing up close to RM5 billion as at November 2021. BNM has approved 47 non-bank e-money issuers as at the time of writing, where some of the biggest players include Alipay, GrabPay, kiplePay, and Touch n’ Go eWallet.

Additional comments regarding the economic situation for payment services or what FinTech’s must be aware of in this business area




© 2022, Lee Hishammuddin Allen & Gledhill. All rights reserved by Lee Hishammuddin Allen & Gledhill as author and the owner of the copyright in this chapter. Lee Hishammuddin Allen & Gledhill has granted to Multilaw non-exclusive worldwide license to use and include this chapter in this guide and to sublicense Lexis Nexis, a division of RELX Inc. and its affiliates certain rights to use and distribute this guide.

The information in this guide provides a general overview at the time of publication and is not intended to be a comprehensive review of all legal developments nor should it be taken as opinion or legal advice on the matters covered. It is for general information purposes only and readers should take legal advice from a Multilaw member firm.


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