KUALA LUMPUR, March 31 — An accelerated shift towards online financial services took place in 2020, with online banking transactions growing by 49 per cent to 2.5 billion transactions compared to 1.7 billion transactions made in 2019.

E-wallet transactions, meanwhile, surged by 131 per cent to about 600 million last year, Bank Negara Malaysia (BNM) said.

“On average, a person in Malaysia made 170 e-payment transactions as compared to 150 transactions in 2019 driven by online and contactless transactions,” it said in its Annual Report 2020.

More merchants also signed up to accept e-payment with the number of quick response (QR) code payment registration increasing by 164 per cent to 773,484 as at the end of 2020, it said.

The central bank said to further support the uptake of online services, an electronic Know-Your-Customer (e-KYC) Policy Document was issued in June 2020, enabling the opening of accounts digitally for customers to occur anytime and anywhere.

“As a gateway towards digitalisation, e-KYC is expected to pave the way for greater innovation and provision of end-to-end digital financial services.

“Several financial institutions, including banks, e-money issuers and remittance service providers have adopted e-KYC solutions, with more expected to follow in 2021,” it added.

The central bank issued the Policy Document on Licensing Framework for Digital Banks on December 31, 2020. It said the licensing of new players with innovative business models is expected to serve the economy and contribute to the well-being of Malaysians.

“Through the use of agile technology platforms and data analytics, digital banks are expected to widen the offering of banking products and services that are more targeted towards solving Malaysian consumer pain points, particularly for the unserved and underserved consumer segments.

“BNM will adopt a proportionate regulatory framework as well as require digital banks to observe limits on aggregate asset exposures during the initial years of operations,” it said.

Meanwhile, the central bank said three global electronic trading platforms (ETP) operators were approved in 2020 to provide their services as intermediaries in the Malaysian financial market.

“This contributed to the digitalisation of the financial market, which also served to support increased remote working arrangements during the pandemic.

“Trades through ETPs accounted for nearly 19 per cent of the total onshore foreign exchange turnover following the commencement of operations by the approved ETP operators,” it said. — Bernama