Malaysia Fintech Digital Remittances Market Size and Forecast by Transfer Channel, End Users, Industry, Remittance Type, and Transaction Purpose: 2019-2033

Malaysia Fintech Digital Remittances Market Growth and Performance

• The Malaysia fintech digital remittances market size in 2023, stood at US$ XX1.0 Million.
• Furthermore, projections indicate that the fintech digital remittances market in Malaysia is poised for sustained growth, with an anticipated annual growth rate of 20.0%.

Malaysia Fintech Digital Remittances Market Outlook

Malaysia fintech digital remittances market is undergoing a transformative shift, driven by rapid technological advancements, regulatory initiatives, and changing consumer preferences. The nation has positioned itself as a leader in digital financial services, with its QR code payment adoption ranking second globally at 61.5%, only behind China. This significant adoption rate is largely attributed to the widespread implementation of DuitNow QR, which has unified payment providers and enabled seamless transactions across banks and e-wallets. Since its introduction in 2019, DuitNow QR registrations have surged to over 2 million merchants, surpassing traditional point-of-sale terminals, and facilitating over 360 million transactions valued at RM 14.6 billion. Small businesses, which constitute 80% of DuitNow QR merchants, have particularly benefited from this transition, as the cost-effective digital infrastructure enhances financial inclusion and transaction efficiency.

Malaysia digital remittance sector is also witnessing steady growth, with inbound remittances increasing by 2.9% in 2022 and projected to reach USD 1.84 billion by 2028. Outbound remittances are following a similar trajectory, with a 2.1% annual growth rate, expected to reach USD 9.72 billion by 2028. This growth is fueled by the widespread adoption of mobile and digital remittance solutions, which offer faster, more secure, and cost-effective cross-border money transfers. Consumers are increasingly shifting away from traditional remittance services to fintech-driven platforms that leverage blockchain technology and artificial intelligence to reduce transaction costs and enhance security. Companies like Merchantrade Asia, which recently expanded its market presence through strategic acquisitions, are at the forefront of this transformation, ensuring seamless digital remittance services tailored to Malaysia’s diverse population.

The rise of digital banking in Malaysia is another key driver of the fintech ecosystem. The introduction of digital banks such as GXBank, AEON Bank, and Boost Bank has revolutionized financial accessibility by offering seamless onboarding, instant credit approval, and personalized banking solutions. These digital-first banking institutions are integrating advanced technologies like machine learning and big data analytics to optimize remittance transactions, reduce processing times, and enhance customer experiences. Additionally, fintech startups are increasingly collaborating with traditional financial institutions to bridge gaps in the remittance landscape and extend financial services to underserved communities.

Cross-border payment integration is another major milestone in Malaysia fintech evolution. The strategic collaboration between Bank Negara Malaysia (BNM) and Bank Indonesia (BI) has enabled the launch of a cross-border QR payment linkage, allowing seamless retail transactions between Malaysia’s DuitNow and Indonesia’s QRIS systems. Future plans include enabling peer-to-peer (P2P) transfers using mobile or national identification numbers, further simplifying cross-border transactions for individuals and businesses. Moreover, the renewal of the Local Currency Bilateral Swap Agreement (LCBSA) between Malaysia and Indonesia, valued at RM 24 billion/IDR 82 trillion, underscores the commitment to promoting local currency use in international trade and investment, reducing reliance on traditional remittance corridors.

The growing role of artificial intelligence and blockchain technology is also reshaping Malaysia remittance market. The recent announcement of a 500MW hyperscale Artificial Intelligence Data Center (AIDC) in Johor highlights the nation’s commitment to digital transformation. This infrastructure will lower barriers for financial institutions to adopt AI-driven remittance solutions, enhancing fraud detection, automating compliance processes, and improving transaction speed. Additionally, blockchain-based remittance platforms are being increasingly explored to offer transparency, security, and efficiency in cross-border payments.

Regulatory advancements are playing a crucial role in fostering innovation while ensuring consumer protection in the digital remittance sector. Malaysia has introduced frameworks such as Digital Insurance and Takaful Operators (DITO) and the National Fraud Portal to enhance financial security and mitigate digital transaction risks. Furthermore, the government’s push towards open banking and tokenized bonds reflects a progressive approach to digital financial services, allowing fintech companies to leverage APIs for seamless financial data exchange and remittance processing.

Financial inclusion remains at the core of Malaysia’s fintech initiatives. Companies like Merchantrade Asia are leading efforts to serve unbanked and migrant populations by offering e-wallet-based salary disbursements, remittances, and microinsurance services. Their collaboration with AmBank Islamic enables users to access higher wallet limits, making digital transactions more accessible. This shift towards digital financial services aligns with Malaysia’s broader vision to achieve 95% financial inclusion and 100% digital payment acceptance among registered businesses by 2025.

Despite the promising growth, challenges remain in the digital remittance sector. High transaction fees, hidden charges, and varying exchange rates across different providers continue to be pain points for consumers. Additionally, bridging the digital divide in rural areas and enhancing cybersecurity measures to combat fraud are key priorities for stakeholders in the fintech ecosystem. Addressing these challenges requires a collaborative effort between fintech firms, regulatory bodies, and technology providers to create an inclusive and secure remittance environment.

Overall, Malaysia fintech digital remittances market is poised for continued expansion, driven by technological innovation, strategic partnerships, and regulatory support. As the nation strengthens its position as a fintech hub in Southeast Asia, the digital remittance landscape will continue to evolve, offering consumers more efficient, secure, and cost-effective cross-border payment solutions.

Malaysia Fintech Digital Remittances Market Scope