Credit, debit card payments account for 36.8% of the country’s total e-commerce value.
Card payments in Malaysia is forecasted to reach $52.4b (MYR214.4b) in 2020 as card payments at point-of-sale (POS) terminals continue to rise amidst social distancing measures in place, reports data and analytics firm GlobalData.
As wary consumers stay at home, they are expected to use online channels to purchase goods, the firm noted. Even whilst shopping in-stores, consumers are gradually shifting away from cash to digital payment tools to avoid exposure to potential disease vectors such as cash and POS terminals.
“Malaysians are increasingly using digital channels for making payments with cash taking a back seat,” said Ravi Sharma, banking and payments lead analyst at GlobalData.
This rise in e-commerce transactions will further support card payments as credit and debit cards account for 36.8% in the total e-commerce value in Malaysia, according to GlobalData’s 2020 Banking & Payments Survey.
This is further supported by the central bank of Malaysia, with the Bank Negara Malaysia (BNM) capping interchange fees on card transactions making card acceptance cost effective for merchants.
BNM has also waived interchange fees on debit cards for payments of government services in the country until 31 December.
Further, POS installation and rental fee and merchant service charges are waived until 31 December 2020. This will allow merchants to start accepting all forms of payments (including contactless payments) via debit and credit cards and also mobile wallets.
“The COVID-19 crisis has adversely affected the Malaysian economy in the short-run. With the government gradually easing lockdown restrictions, a rise in business activities and consumer spending could be seen, which will further support card payments growth,” Sharma concluded.
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