02/10/2024

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SCAN ME

WEDNESDAY | OCT 2, 2024

M’sia surpasses digital payments target KUALA LUMPUR: Malaysia has surpassed its digital payment target at 405 transactions per capita, said Bank Negara Malaysia (BNM). o Current level of 405 transactions per capita exceeds goal in financial sector blueprint of 400 by the end of 2026: Bank Negara Ű BY HAYATUN RAZAK sunbiz@thesundaily.com with the aim of providing a regulatory environment that is conducive for the deployment of financial technology and facilitate overall innovation in the Malaysian financial sector. people always argued that BNM is an ivory tower organisation, won’t talk to people, is very difficult to talk to, not accessible, etc.”

The sandbox is a regulatory tool for enhancing policies to ensure they are fit for purpose. For example, it may allow tokenised offerings to be tested within the sandbox in line with the SC’s efforts to develop its technology-agnostic approach for tokenised securities and identify best practices. In this respect, the SC said it will develop a guidance early next year for intermediaries to understand and manage associated risks in relation to securities tokenisation. Corporations have until April 2025 to apply for the first cohort of the sandbox. Interested parties are required to participate in preconsultation sessions prior to submission. Accepted applications will have up to 12 months to test their products or services. Eligibility criteria include offering innovative capital market products or services that are not currently available in Malaysia and do not fully fit under existing regulatory framework that bring value to the market. In addition, the SC is collaborating with Khazanah Nasional, as a potential issuer, to explore how blockchain technology can enhance the efficiency of bond issuance and operations. This year’s edition of the summit focuses on the use cases and opportunities of emerging tech nologies like artificial intelligence and blockchain in the capital market. The summit also featured the Demo Day of the SC FIKRA ACE Accelerator’ programme where 10 startups pitched for the chance to be selected as 2024 cohort’s winners. - by HAYATUN RAZAK Suhaimi said the central bank is changing its posturing because it recognises that a lot of things that it used to be able to do itself in the past, via its first and second blueprint, can no longer be done individually under the third blueprint. “It requires a whole-of-nation approach and collaborative partnership with different stakeholders.” Suhaimi also pointed to another achievement – digital bank and digital insurance framework. “We have also launched the DITO framework (digital insurers and takaful operators framework) in July this year, laying a foundation for a more innovative insurance landscape and providing some of the needed clarity to some of the fintech companies in the insurance space,” he said.

He was referencing Standard Sandbox, which refers to standard procedures introduced in October 2016 to allow fintech companies to test innovative solutions, and Green Lane, an accelerated track introduced in February this year that provides a simpler and quicker way for financial institutions with a strong track record in risk management capabilities to test innovative solutions that face regulatory impediments. “We have a three screening and mentorship programme which offers advice and support to both tech companies and financial institutions,” he added. Suhaimi said that this is part of its efforts to be “a bit more collaborative” with ecosystem players. “In the past,

BNM assistant governor Suhaimi Ali said the target under the financial sector blueprint was to achieve 400 transactions per capita by the end of 2026. “In digital payments, we’ve reached 405 transactions per capita today. This means we are well ahead of schedule in e-payments,” he said in a panel session at the SCxSC Fintech Summit 2024 yesterday. At the national level, Suhaimi said, Malaysia is not short of initiatives to foster innovation through a combination of robust policy, frame works, strategic initiatives, and collaborative partnerships. “Key national strategies and digital

programmes have been rolled out. The challenge for us is always execution. That has always been a challenge for Malaysia as a country,” he remarked. He said BNM recognises the renewed approach to emerging innovation. “This is timely for us to also relook at how we do things at Bank Negara.” Suhaimi said the central bank is guided by the principles of parity, proportionality, and neutrality. “Same rules, proportionality, same risk level, the same kind of revelation. And neutrality typically requires outcomes over any technology or

particular submission.” Suhaimi said BNM’s reforms so far have been directed to remove barriers to innovation and address market failures. “This entails modernising our regulatory framework while opening everything for more flexible pathways or in a way to innovate safely and responsibly.” Suhaimi highlighted notable developments that have been achieved, including a refresh of the regulatory sandbox which now features two main tracks to accelerate the time to live testing. He pointed to the regulatory sandbox that was launched by BNM

SC to launch regulatory sandbox, enhance securities tokenisation

Porat delivering her speech at the event yesterday. – BERNAMAPIC

KUALA LUMPUR: The Securities Commission Malaysia (SC) will introduce a regulatory sandbox and enhance its regulatory framework to encourage securities tokenisation to spur innovations in the capital market. The SC will collaborate with Khazanah Nasional Bhd to explore the issuance of tokenised bonds. The initiatives, unveiled at the SCxSC Fintech Summit 2024, are aimed at promoting responsible innovation in the capital market. SC chairman Datuk Mohammad Faiz Azmi said the SC is committed to fostering a thriving fintech ecosystem and drive innovation in the capital market. “Malaysia’s Madani Economy Framework emphasises restructuring of the economy for competitiveness and sustainability. Our capital market, which now stands at RM3.95 trillion, must adapt to evolving demands related to climate change, social inclusion, new growth sectors, and demographic shifts,” he said in his opening remarks at the summit yesterday. Recognising rapid technological advancements, the SC said it has received several proposals that do not fully fit within existing regulatory frameworks. To address this, the SC is introducing a regulatory sandbox framework, providing a controlled environment for testing innovative products and services while ensuring investor protection. Corporations developing solutions in areas like financial inclusiveness, Islamic finance and retirement solutions are encouraged to apply.

Google says Malaysia investments to add US$3b to GDP by 2030, create 26,500 jobs

KUALA LUMPUR: Google said yesterday its investments in Malaysia would create 26,500 jobs and contribute more than US$3 billion (RM12.5 billion) to its economy by 2030, as it announced its new data centre and Cloud region there had broken ground. The start of construction of the new US$2 billion data centre in Malaysia follows Monday’s announcement of its multiyear partnership with local tech firm Dagang NeXchange Bhd to provide sovereign cloud services. It also follows Monday’s announcement that it would invest US$1 billion in Thailand to build a data centre and cloud region there, to meet growing cloud demand and support Artificial Intelligence (AI) adoption in Southeast Asia.

and the ringgit currency becoming one of Asia’s top performers. Porat said its ventures in Malaysia included support for new sustainability initiatives, such as improvements in water quality, plus skilling, with 355,000 Malaysians already trained since 2019 in digital skills. Google’s moves are a part of a wider expansion by global tech companies into Southeast Asia, as they vie for a greater presence in a region with a young tech-savvy population of 670 million. Earlier this year, Microsoft announced cloud services invest ments worth US$1.7 billion in Indonesia, while Amazon plans to invest US$9 billion in Singapore, US$5 billion in Thailand and US$6.2 billion in Malaysia. – Reuters

“Our investments are designed to provide high performing and reliability, meeting demand for cloud and AI services across the country,” Google president and chief investment officer Ruth Porat told an event in Malaysia. Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Andul Aziz said data centres would support the country’s ambitions to be a regional leader in the tech sector, including AI. “Regionally the demand for data processing and storage solutions is increasing exponentially and Malaysia is well positioned to meet this demand,” he told the event. Digital investments have helped propel Malaysia’s economy this year, with growth beating market expectations in the last two quarters