The Beginner’s Guide to Fintech: How Technology Is Changing Finance in Malaysia
Financial technology, or fintech, is revolutionizing the way Malaysians interact with money. From digital banking and e-wallets to AI-driven lending and insurtech, fintech is reshaping the financial landscape across the country. This guide offers an overview of how fintech is transforming finance in Malaysia, drawing on developments from 2020 to 2025.
What Is Fintech?
Fintech refers to the integration of technology into financial services to enhance their delivery and accessibility. In Malaysia, fintech encompasses a broad spectrum of services, including:
- Digital payments and e-wallets
- Online lending platforms
- Digital-only banks
- Insurtech (insurance technology)
- Wealth management tools
- Cryptocurrency and blockchain applications
These innovations aim to make financial services more efficient, accessible, and user-friendly for consumers and businesses alike.
The Fintech Boom in Malaysia
Malaysia’s fintech sector has experienced significant growth in recent years. The market size is projected to reach USD 53.89 billion in 2025, with expectations to double to USD 111.05 billion by 2030, growing at a compound annual growth rate (CAGR) of 15.56%.
Key players in the Malaysian fintech ecosystem include:
- TNG Digital: Operator of the Touch ‘n Go eWallet, serving over 20 million users and more than two million merchants.
- Jirnexu: Provides digital solutions for banks and insurers.
- CapBay: Offers supply chain finance solutions.
- PitchIN: A leading equity crowdfunding platform.
The sector’s expansion is driven by factors such as high smartphone penetration, a youthful and tech-savvy population, and supportive regulatory frameworks.
Digital Banks: A New Era
The advent of digital banks marks a significant shift in Malaysia’s banking landscape. In 2023, GXBank became the first digital bank to launch, quickly amassing nearly one million users. Following suit, Ryt Bank, a joint venture between YTL Digital Capital and Sea Limited, received approval to commence operations, focusing on AI-powered banking services.
Traditional banks are also adapting; for instance, Maybank has partnered with Audax Financial Technology and Amazon Web Services to enhance its digital offerings, aiming to provide a wide range of Islamic financial products by 2025.
E-Wallets and Digital Payments
E-wallets have become increasingly popular in Malaysia, with platforms like Touch ‘n Go eWallet leading the charge. These digital wallets offer convenient payment solutions and have expanded to include services like investments, lending, and insurance.
The Buy Now, Pay Later (BNPL) segment is also gaining traction. In 2025, the BNPL market in Malaysia is expected to grow by 15.1% to reach USD 2.52 billion, with projections to expand to approximately USD 4.22 billion by 2030.
Insurtech: Making Insurance Accessible
Insurtech is addressing challenges in Malaysia’s insurance sector, such as rising premiums and limited accessibility. Companies like PolicyStreet are leveraging technology to offer more affordable and user-friendly insurance solutions. These innovations aim to increase insurance penetration and provide better protection for underserved populations.
Financial Inclusion and Youth Adoption
Fintech plays a crucial role in promoting financial inclusion in Malaysia. Digital financial services are reaching previously underserved communities, including rural areas and migrant workers. A study focusing on the Klang Valley region found that a tech-savvy youth population is driving the adoption of fintech solutions, valuing the convenience and security they offer.
Looking Ahead: The Future of Fintech in Malaysia
As Malaysia continues to embrace digital transformation, the fintech sector is poised for further growth. Innovations in areas like green fintech, AI-driven financial services, and cross-border payments are expected to shape the future landscape. With supportive policies and a dynamic ecosystem, Malaysia is well-positioned to become a fintech hub in Southeast Asia.
