08/02/2026

ON SUNDAY February 8, 2026 theSunday Special V

But outside the Klang Valley, the story changes dramatically. “In smaller towns and kampungs , cash remains the predominant payment method. Even though digital options exist, poor or inconsistent internet connections make transactions unreliable and frustrat ing,” he added. While Malaysia ranked second-highest in the world in QR code payments adop tion after China, according to Bank Negara Malaysia’s 2023 Financial Stability Re view WKH EHQH¿WV RI GLJLWDO SD\PHQWV KDYH yet to reach many rural areas. Connectiv ity gaps, low awareness and the perceived complexity of digital tools remain key barriers.

“Personal engagement matters. By providing training, guidance and frequent follow-up in collaboration with govern ment programmes, we can enable rural communities to participate fully in the digital economy,” he added. Family-run businesses take small steps In rural Malaysia, many micro-businesses are family-run – small sundry shops, pasar tani stalls and local eateries. These are the backbone of small-town econo mies, yet most still operate informally and deal entirely in cash. However, change is slowly taking root. “We’ve seen encouraging adoption trends, especially in the eastern and southern regions,” he noted, referencing a study by IPOS that found an increasing number of rural consumers now using e-wallets and online banking for everyday transactions. “The shift among family-run busi nesses is gradual, but it’s happening. Once owners see how cashless payments can simplify transactions, enhance safety and save time, they become more open to adopting them. The goal is to integrate micro-businesses into the digital economy with as little disruption as possible,” Tee said. Warungs or small local eateries have long been the heartbeat of Malaysian communities. They’re not just food stalls; they’re social hubs where neighbours gather and news travels fast. Tee believes this social aspect makes them powerful catalysts for digital change. “When local shops and warungs adopt cashless payments, they normalise the behaviour for customers and inspire others to follow suit. We had a merchant partner in Johor who started with QR payments only and later expanded to multiple payment options. That created D ULSSOH H̆ HFW LQ KLV FRPPXQLW\ ´ KH VDLG y

One key approach to cashless payment is simplicity.

Indeed, the success of cashless adop tion in rural areas often depends on such GRPLQR H̆ HFWV ± ZKHQ RQH WUXVWHG ¿JXUH WDNHV WKH ¿UVW VWHS RWKHUV DUH TXLFN WR follow. To make digital payment truly inclusive nationwide, Tee emphasised the impor tance of partnerships at every level. “Nationwide accessibility relies on collaboration between the public, private and grassroots sectors,” he said. The public sector plays a vital role in GULYLQJ GLJLWDO OLWHUDF\ DQG R̆ HULQJ JUDQWV or subsidies to small merchants. The SULYDWH VHFWRU SDUWLFXODUO\ ¿QWHFK ¿UPV continues to expand infrastructure and GHYHORS D̆ RUGDEOH UHOLDEOH VROXWLRQV $W the grassroots level, community organisa tions and cooperatives help to build trust and raise awareness, particularly among older or less tech-savvy populations. In 2023, the Malaysian government announced a RM100 million allocation to support digitalisation among micro, small and medium enterprises through grants and incentives.

Policy is just one part of the equation. On-the-ground engagement is what turns technology into adoption. Building inclusivity from the ground up Inclusivity, Tee stressed, must be em bedded into every layer of the cashless system. “If the payment option is only via smartphone apps, we’re excluding the older generation and those without smart devices,” he said. T KH VROXWLRQ LV WR R̆ HU PXOWLSOH DFFHVV points. “Card payments, QR codes and other forms of digital acceptance – all designed with clear visuals, multilingual support and simple steps,” he stressed. Training sessions, community work shops and partnership initiatives also play a major role. By combining user friendly devices with human outreach, the goal is to make digital tools intuitive and accessible to everyone, regardless of age or literacy. R HGH¿QLQJ VXFFHVV LQ WKH FDVKOHVV transition Tee believes it’s not just about numbers. “Transaction volume is one indicator, but it doesn’t tell the full story. True success is when merchants and customers naturally choose digital payment in their daily lives,” he said. Qualitative signs – such as smoother onboarding, consistent long-term usage and customers instinctively asking, ‘Do you take e-wallet or online banking?’ – often reveal deeper progress. “It’s a balance of metrics and mindset,” he said. $ ¿QDQFLDOO\ LQFOXVLYH 0DOD\VLD LV RQH where every business, from roadside VWDOOV WR FLW\ UHWDLOHUV KDV DFFHVV WR D̆ RUG able and secure digital payment solutions DQG XVHV WKHP FRQ¿GHQWO\ $ chieving that vision requires coop eration between the public and private sectors, stronger digital literacy and interoperable payment systems. “Financial inclusion isn’t just a target. It’s a commitment to making cashless work for everyone, everywhere,” he said. $ s Malaysia’s digital economy contin ues to expand – projected to contribute 25.5% to GDP by 2025 according to MDEC, bridging the urban–rural pay ment gap is more than a technological milestone. It’s about ensuring no one, whether in Bangsar or Baling, gets left behind in the nation’s cashless future.

In urban areas, cashless payments had already become second nature.”

The challenges of going cashless in the kampung Infrastructure remains a pressing issue. Many rural traders still operate in areas with limited broadband or mobile data coverage. Without stable connectivity, cashless transactions can be a test of pa tience for both merchants and customers. Beyond technology, the human factor plays an even bigger role. “Cash is familiar and for some, it feels safer. Digital illiteracy also makes both merchants and customers hesitant to WU\ VRPHWKLQJ QHZ $QG ZKHQ FDVKOHVV terminals are costly to purchase and maintain, small businesses operating on thin margins often can’t justify the expense,” he said. To overcome these barriers, payment SURYLGHUV KDYH EHJXQ LQWURGXFLQJ D̆ RUG able, user-friendly solutions designed to work even in low-connectivity areas. Lat est devices, for instance, come equipped with both Wi-Fi and SIM card connectivity to ensure stable operations. But beyond hardware, Tee stressed that education and trust-building were just as vital. Technology alone can’t bridge the gap. Human elements such as education, trust and ongoing support are equally critical. 5XUDO PHUFKDQWV QHHG WR IHHO FRQ¿GHQW that the technology will work for them and they must have access to assistance when needed. This echoes broader national goals XQGHU 0DOD\VLD¶V 0\',*,7$/ LQLWLDWLYH which aims to transform the country into a digitally driven, high-income nation by 2030. While programmes promoting H ZDOOHW DGRSWLRQ DQG ¿QDQFLDO LQFOXVLRQ have made progress, the digital divide remains stark. $ ccording to the Department of Statistics Malaysia, only 63% of rural households had internet access in 2022, compared to 94% in urban areas. These ¿JXUHV XQGHUOLQH ZK\ FDVKOHVV LQFOXVLYLW\ isn’t just about rolling out terminals, it’s about ensuring the people behind those devices are supported and empowered.

Training and trust-building are crucial for digital inclusion.