Driven by the rise of the e-commerce market in Malaysia, digital payment systems, including credit cards, online banking, and e-wallets, also rose in popularity among more tech-savvy consumers. Cashless methods dominated the market share of e-commerce payment methods for Malaysians, with bank transfers and credit cards as the most popular options.
Digital economy transformation
The gross transaction value of digital payments in Malaysia increased by more than 13 billion U.S. dollars in 2023 and was forecast to reach around 207 billion U.S. dollars by 2025. In conjunction with the Malaysian government’s initiative to transform the country into a digital economy by 2030, the 2021 launch of the national blueprint, MyDigital, made this goal seem achievable. One of the action plans of the blueprint was to provide electronic payment options in all ministries and government agencies.This transformation is also supported by the country’s well-developed infrastructure on connectivity. Around 97 percent of the population in Malaysia has access to 4G LTE mobile networks, while 5G population coverage has increased to more than 47 percent in 2022. Hence, consumers would be able to use their favorite digital payment services at any time.
Cash is no longer king
The current trend of carrying e-wallets can be largely attributed to hygiene concerns stemming from the pandemic among Malaysian consumers. Per capita transaction value of e-money in Malaysia rose by nearly 40 percent in 2022. Touch n’ Go, Grabpay, and Boost are some of the leading e-wallet brands currently dominating the market. Although all business activities have now resumed to normal, this cashless trend is expected to remain in post-pandemic Malaysia.New payment services like Buy Now Pay Later (BNPL) are also becoming more popular among Malaysian users. BNPL spending on e-commerce in Malaysia was estimated to reach around 900 million U.S. dollars in 2026. With consumers’ increasing preference to go cashless, as well as support from the government to transform the country into a digital economy, the digital payment sector in Malaysia is set to flourish.
