Malaysia has officially entered the digital banking era. Bank Negara Malaysia (BNM) issued five digital banking licenses to accelerate financial inclusion, innovation, and digital transformation in the financial sector.
Digital banks operate primarily online without physical branches. They focus on technology-driven services, lower operational costs, and improved accessibility for underserved communities and SMEs.
Below is a detailed explanation of the licensed digital banks in Malaysia.
- GXBank Berhad
License Holder: GXBank Berhad
Major Shareholders:
Grab Holdings
Singtel
Kuok Group
Launch Status: First operational digital bank in Malaysia (launched 2023).
Target Market:
Retail consumers
Gig workers
Underserved individuals
Digital-savvy users
Key Features:
Fully digital onboarding via mobile app
Savings accounts with competitive interest rates
No physical branches
Real-time transaction notifications
Integration with Grab ecosystem
Strengths:
Strong ecosystem support from Grab
Focus on financial inclusion
User-friendly app experience
Business Model Focus:
Consumer banking
Micro-savings
Digital payments
- AEON Bank (AEON Financial Service & MoneyLion)
License Holder: AEON Bank Berhad
Major Shareholders:
AEON Financial Service (Japan)
MoneyLion
Target Market:
Retail customers
Middle-income households
Existing AEON customers
Expected Focus:
Digital savings
Personal financing
Consumer credit
Buy Now Pay Later integration
Strengths:
Strong retail ecosystem
Existing customer base through AEON stores
Experience in consumer financing
Business Model Focus:
Consumer lending
Digital credit services
Retail-based financial ecosystem
- Boost Bank (Axiata & RHB Partnership)
License Holder: Boost Bank Berhad
Major Shareholders:
Axiata Group
RHB Bank
Target Market:
Micro, small and medium enterprises (MSMEs)
Digital wallet users
Small merchants
Key Focus:
SME financing
Micro-lending
Digital wallet integration
Financial inclusion for small businesses
Strengths:
Strong fintech background (Boost e-wallet)
Banking expertise from RHB
SME-focused ecosystem
Business Model Focus:
Digital SME banking
Working capital financing
Merchant services
- KAF Digital Bank
License Holder: KAF Digital Bank Berhad
Major Shareholders: KAF Investment Bank
Target Market:
SMEs
Retail customers
Investment-oriented clients
Key Focus:
Digital Islamic banking services
Investment products
SME financing
Strengths:
Strong capital market experience
Islamic finance positioning
Investment expertise
Business Model Focus:
Islamic digital banking
SME solutions
Wealth management integration
- Ryt Bank (Sea Group / Shopee related consortium)
License Holder: Sea Capital Services
Major Shareholders: Sea Group (Shopee parent company)
Target Market:
E-commerce sellers
Online entrepreneurs
Retail consumers
Key Focus:
Digital payments
SME financing
E-commerce ecosystem integration
Strengths:
Shopee ecosystem
Strong digital user base
Regional experience in digital banking
Business Model Focus:
E-commerce integrated banking
SME working capital
Digital wallet synergy
WHAT MAKES DIGITAL BANKS DIFFERENT FROM TRADITIONAL BANKS?
-
No Physical Branches
Fully app-based services. -
Faster Account Opening
Fully online KYC verification. -
Lower Operating Costs
No branch maintenance. -
Data-Driven Credit Assessment
Use alternative data such as transaction behavior. -
Target Financial Inclusion
Serve gig workers and small businesses.
BNM DIGITAL BANKING FRAMEWORK
Bank Negara Malaysia structured digital banks into two phases:
Foundational Phase (3–5 years):
Restricted asset size
Close supervision
Focus on sustainable growth
After successful compliance: Full operational status granted.
BENEFITS OF DIGITAL BANKS
Convenience
Lower fees
Faster services
Innovation-driven
Financial access for underserved groups
RISKS AND CONSIDERATIONS
Technology risks
Cybersecurity threats
Limited physical customer support
New business model risk
Digital banks are still under close regulatory monitoring to ensure stability.
ISLAMIC DIGITAL BANKING IN MALAYSIA
Malaysia is a global leader in Islamic finance. Some digital banks are structured under Islamic principles, offering Shariah-compliant products.
This ensures:
No riba (interest-based elements)
Shariah governance
Ethical investment screening
FUTURE OUTLOOK
Digital banking in Malaysia is expected to:
Increase competition
Improve service quality
Lower banking costs
Support SME growth
Enhance financial inclusion
Traditional banks are also accelerating digital transformation in response.
CONCLUSION
Malaysia currently has five licensed digital banks operating under Bank Negara Malaysia’s supervision. Each has a specific focus, such as consumer banking, SME financing, Islamic finance, or ecosystem integration.
Digital banks represent the future of financial services in Malaysia, offering convenience, innovation, and broader financial access.
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