My Fintech Week 2019: Entering the ‘new’ cashless era

• Touch N’ Go teams up with Ant Financial to rip apart old processes
• Consolidation of e-wallets “will happen”

IN A discussion entitled "Riding the Cashless Wave" at Malaysia Fintech Week 2019, pannelists comprised of Axiata Digital Services chief executive officer Khairil Abdullah; Maybank head of virtual banking and payments Kalyani Nair; TNG Digital chief executive officer Syahrunizam Samsudin took to the stage to discuss Malaysia's e-wallet scene.

Led by Main Street Capital chief executive officer Julian Ng, Khairil said that one of Boost's primary challenges is still the culture of using cash. Commenting on 40 e-wallet licensees present in the Malaysian market, he believes the outcome will not be a "winner take all" scenario. "Regulators will prevent that from happening. Each of us will bring some sort of strategic advantage," he said.

Sharing her thoughts on Maybank’s 11 million footprint, Kalyani said: “We do have a large base but it is always about how we can keep moving forward.” To acquire new customers, the bank has launched the Maybank e-wallet (MAE) as “the first entrypoint into getting a full-fledged banking account” in a more frictionless way.

The new cashless

Shifting the conversation to Touch N’ Go’s market position, Syahrunizam said Malaysia has always been forward-looking in terms of cashless acquisitions.

Admittedly, cash creates many “unnecessary processes” that are difficult to unbundle especially since it involves the government and multiple ecosystems. Syahrunizam highlights that, “it has taken 10 years to communicate to all the citizens and users that this is how it is supposed to be done.”

Teaming up with Alibaba’s Ant Financial, TNG Digital offers e-wallet services by “ripping apart old processes and working with partners like the government and private sector” to carry out back channel work and communicate its simplicity to users.

“Cashless does not mean just digitising cash,” he said, adding that this is the gap in Touch N Go’s older product that it is currently addressing.

Generationally, Syahrunizam believes the ecosystem is experiencing a shift in what it perceives is “easy”, moving away from reloading cards with physical cash towards increasing reliance on the smartphone.

Consolidating e-wallets in the market

The panellists were also asked to share their views on the consolidation of e-wallet players. “It will happen,” said Khairil. “Internally, we have a view that actually within three years or so, non-cash payments will be way above 50%.”

“But at that stage, it will be up to the very big players who have the financial capacity to take [the market] on,” he shared, adding that Bank Negara spearheading interoperability will help smaller e-wallets.

Meanwhile, Syahrunizam pointed out the difference between China and Malaysia’s e-wallet game. With a population of 32 million in Malaysia, there are about 40 e-wallet licensees in the market. “China has 1.5 billion people. Guess how many e-wallets they have? Only two.”

As for Kalyani, she believes that, who remains will depend on the value proposition they offer to users. “Its about ensuring that whatever you do in this business is relevant to the customer. This is where customer experience comes in.”