Malaysia credit to private non-financial firms rises 5.5% in January

The digital lending solutions market to reach a value of $4.2b by the end of 2025.

Malaysia’s credit to the private non-financial sector rose by 5.5% in January, a marginal increase from the 5.4% growth recorded in December 2025, data from the Bank Negara Malaysia showed.

This uptick was primarily driven by a rise in outstanding corporate bonds, which grew by 7.6% compared to 6.9% the previous month.

Lending through outstanding loans maintained a steady growth rate of 5%. Within this category, business loans saw a small increase to 4% growth, up from 3.9% in December. 

This expansion was largely supported by higher demand for investment-related loans amongst larger corporations, whilst lending to small and medium-sized enterprises (SMEs) remained stable.

Household lending growth also held firm at 5.6%, matching the rate seen in December 2025. 

This stability was reflected across most loan categories as borrowing patterns remained consistent into the new year.

The digital lending solutions market in Malaysia is on track to reach a value of $4.2b by the end of 2025, according to Data Dynamics Specialist. 

This represents a compound annual growth rate (CAGR) of approximately 22% since 2023, spurred by a national push for financial inclusion and a surge in digital adoption amongst consumers.

Technology is the primary driver of this shift. The integration of artificial intelligence (AI), machine learning, and automation has streamlined credit assessments and underwriting. 

These advancements have reduced loan approval times from several days to just a few minutes. 

Additionally, the industry has seen the introduction of blockchain for secure transactions and biometric authentication to improve security.

These technological updates have significantly lowered operational costs for providers, with some reporting a 35% decrease. 

This efficiency allows market leaders to offer more competitive interest rates and flexible repayment terms.

Recent developments between 2023 and 2025 highlight a changing landscape. Major fintech companies have launched AI-powered credit scoring tools, which have increased loan approval rates by 15%. 

Furthermore, new partnerships between traditional banks and insurtech firms have created hybrid lending platforms.