Kuala Lumpur – June 29, 2022: Malaysia continues to accelerate its real-time payments adoption as well as introduce a stream of modern services, making it one of the most sophisticated real-time markets in the world, according to the third edition of Prime-Time for Real Time 2022, published by ACI Worldwide, in partnership with GlobalData, a leading data and analytics company, and the Centre for Economics and Business Research (Cebr).
According to the report, Malaysia’s real-time payments journey has been fast, distinctive, and sophisticated: encompassing speedy adoption built on low-value transactions, rapid evolution towards more sophisticated and value-added services, and a government determined to assist in driving adoption.
Much of the country’s success comes from a concerted effort by the government, central bank, national switch, and industry to modernise the country’s real-time payments infrastructure and harmonise the nation’s payments structure.
The report – tracking real-time payments volumes and growth across 53 countries – includes an economic impact study for the first time, providing a comprehensive view of the economic benefits of real-time payments for consumers, businesses, and the broader economy across 30 countries. The report covers all G20 nations, excluding Russia.
The research shows that governments that advance the real-time modernization of their national payments infrastructure create a win-win situation for all stakeholders in the payments ecosystem: consumers and businesses benefit from fast, frictionless and hyper-connected payments services, financial institutions future-proof their business in a highly competitive environment by speeding up cloud-first and data-centric modernization, and national governments boost economic growth, reduce the size of their shadow economy and create a fairer financial system for all.
Other Highlights:
Malaysia:
- Recorded 1.1 billion real-time payments transactions in 2021, facilitating an estimated US$ 434 million cost savings for businesses and consumers, and unlocking US$ 364 million of additional economic output, equivalent to 1.11% of GDP.
- 5th fastest-growing real-time market, globally, with a CAGR of 26.9%: Malaysia is exceptional in the speed with which it has implemented nationwide real-time payments, and its rapid adoption by banks and non-bank participants
- Cebr forecasts real-time transactions to grow at 3.6 billion in 2026, a CAGR of 26.9%, with net savings for consumers and businesses expected to reach US$ 637 million in 2026, generating additional economic output of US$ 954 million, or 0.2% of GDP.
Indonesia:
- Dec 2021, saw launch of first nationwide real-time payments network, BI-FAST. By 2026, real-time transactions are forecast to reach to 1.6 billion
Thailand:
- Recorded real-time payments volumes of 9.7 billion and had the 2nd largest forecasted percentage increase in GDP (2.08%) facilitated by real-time payments - globally
Singapore:
- Real-time payments transactions hit 256 million and forecast to reach 603 million in 2026, a CAGR of 18.7%
Malaysia’s real-time journey began in December 2018, with the arrival of a new real-time payments system, DuitNow, introduced by national payments network and central infrastructure provider, PayNet.
The new, modernised system, built on the latest interoperable, global, and open payments messaging standard, ISO 20022 expanded basic real-time low value account transfers to include transfers via mobile phones and ID numbers. It also supported online payments, in store QR code-based payments, future-dated and recurring payments, and real-time cross-border payments with ASEAN.
Recent innovations have included consent management platforms for real-time debits, ‘DuitNow Request’. Future services include Know Your Customer (KYC) digital ID compatibility.
The report forecasts, increasing consumer awareness, a growing preference for mobile payments, and the abundance of DuitNow services and features, will result in real-time payments volume growth of CAGR of 26.9% from 2021-2026
“Malaysia is the perfect example for other ASEAN countries on how to establish, align, and drive adoption of a modern real-time payments network.” said Chee Cheng Ong, VP and Head of ASEAN, ACI Worldwide. “By opting to form its real-time network on ISO 20022, it is rapidly becoming one of the most harmonized and sophisticated real-time payment environments in the world - and a perfect launchpad to accelerate adoption as well as provide a host of new and value-added services.”
"Asia-Pacific remains at the forefront of real-time payments innovation as its real-time base pivots towards larger volume transactions and more sophisticated services for our businesses and consumers," said Leslie Choo, Managing Director of Asia-Pacific, ACI Worldwide. "The next stage of evolution for the region is to develop linkages to provide a truly pan-regional real-time infrastructure, unlocking much greater economic benefit and opening up the formal financial sector to the region's vast unbanked and underbanked population."
Additional quotes
“By allowing for the transfer of money between parties within seconds rather than days, real-time payments improve overall market efficiencies in the economy”, commented Owen Good, Head of Advisory, Centre for Economics and Business Research. “Real-time payments improve liquidity in the financial system and therefore act as a catalyst for economic growth. This is especially important for our fast-paced and digital-led gig economies. Workers are paid quickly, allowing them to better plan their finances. Instant payments allow businesses to be more flexible and reduces the need for burdensome cashflow management.”
“Real-time transactions and growth forecasts continue to rise globally, with emerging countries leading the way and outpacing developed nations. Governments around the globe who enable real-time schemes are driving economic growth and prosperity, by providing consumers and businesses with cheaper, faster, and more efficient payment methods,” said Jeremy Wilmot, Chief Product Officer, ACI Worldwide.
“Developing nations continue to drive the majority of volume gains, confirming the industry trend of the strongest growth coming from economies with minimal existing electronic payments infrastructure, and therefore heavier reliance on cash,” said Sam Murrant, Lead Analyst, GlobalData. “In almost all cases, government initiatives are significant drivers of the transition to real-time for a variety of reasons. The enhanced regulation digital payments enable reduces the shadow economy and increases the tax take. And a modernized infrastructure boosts financial inclusion where traditional mechanisms, such as cards and formal bank accounts, are lacking.”
