After making headlines for submitting digital bank licence application and leading a handful of consortiums, ride-hailing unicorn Grab and online gaming startup Razer are reportedly considering to apply for a similar licence in Malaysia, says a PYMNTS report.
Names like AirAsia, Axiata, CIMB, and financial institutions such as Hong Leong Bank and Maybank are also likely to join the race, a source familiar with the matter told the publication.
“Many financial and non-financial institutions are sizing up market opportunities and working with external parties,” one of the sources was quoted as saying.
The report also mentioned that some have been in discussions with consultants for guidance as they weigh in the possibility of moving into digital banking.
Last month, Malaysia’s central bank revealed that it will issue up to five conventional and Islamic online banking licenses. The licensing system is being prepared and is expected to be finished by the end of June this year.
Also Read: These tech companies are eyeing for Singapore’s digital banking license
Malaysia’s central bank BNM also said that it will likely prefer bidders with capital governed by firms in the region to have a chance in obtaining the licence.
One of the earliest applicants of Singapore’s digital bank licence is the gaming startup Razer’s fintech arm. Razer Fintech’s CEO Lee Li Meng shared that it has ‘vast enterprises in Malaysia’s online payments arena and would assess the prospects of digital banking’. The company was already in discussion with a regional conglomerate for a Malaysian licence.
Meanwhile, telecommunication firm Axiata will be allowed to submit an application via its Axiata Digital Services unit, which controls the e-wallet Boost.
AirAsia’s financial services arm BigPay also runs an e-wallet that has a prepaid card.
Another Singapore’s digital bank licence hopeful Jack Ma’s Ant Financial and Touch n’ Go currently are the biggest e-wallet services in Malaysia with 6.9 million customers. CIMB holds a majority stake in Touch n’ Go, which can give it the upper hand in the possibility of going after a digital banking licence.
Malaysia’s draft doctrine also states that electronic banks are required to “minister to underserved and unserved populations” with services and solutions that focus on the void in the market.
Also Read: Customer onboarding and the brand new digital banking licences by MAS
Digital banks in the country are also required to maintain US$24.5 million in starting capital and scale to US$74 million.
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Photo by Poh Wei Chuen on Unsplash
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