{
  "title": "Malaysia: Selected Issues",
  "publication": "IMF Staff Country Reports, February 28, 2020",
  "sourceUrl": "https://www.imf.org/en/publications/cr/issues/2020/02/27/malaysia-selected-issues-49106",
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  "summary": "This Selected Issues paper investigates impact of financial technology (FinTech) on Malaysia’s financial sector. Malaysia is digitally enabled to seize the opportunities brought by FinTech.",
  "sections": [
    {
      "heading": "Executive summary",
      "content": "- Investigates impact of financial technology (FinTech) on Malaysia’s financial sector.\n- Malaysia is digitally enabled to seize the opportunities brought by FinTech.\n- Malaysian banks continue to dominate in deposits, lending and capital raising, but have been gradually reducing their emphasis on physical distribution networks.\n- The top five Malaysian banks have increased their technology-related spending over the past three years.\n- Regulators have been mindful of developments outside of the traditional regulatory perimeter that could pose financial stability risks.\n- Rapidly evolving technology is likely to bring multiple challenges to the financial sector."
    },
    {
      "heading": "Key findings",
      "content": "- Digital readiness: Malaysia is positioned to take advantage of FinTech-driven opportunities.\n- Banking sector structure:\n  - Banks remain dominant in deposits, lending and capital raising.\n  - There is a gradual shift away from physical distribution networks.\n  - The top five Malaysian banks increased technology-related spending over the past three years.\n- Regulatory landscape:\n  - Developments outside the traditional regulatory perimeter may pose financial stability risks.\n  - Regulatory requirements are an important component of operating in the FinTech space.\n  - Regulators must balance financial stability and consumer protection with promoting innovation and competition.\n- Capacity building:\n  - Bank Negara Malaysia has spearheaded various initiatives to address the lack of regulatory acumen among FinTech industry players.\n- Sectoral scope:\n  - A key regulatory challenge is to balance benefits and downside risks in both conventional and Islamic finance.\n- Supervision and regulation:\n  - Frequent refinements to regulations and supervision are required to keep pace with the highly dynamic nature of FinTech."
    },
    {
      "heading": "Policy recommendations and implications",
      "content": "- Maintain balance between:\n  - Ensuring financial stability and consumer protection.\n  - Promoting innovation and competition in FinTech.\n- Strengthen regulatory reach:\n  - Monitor and address risks arising outside the traditional regulatory perimeter.\n- Enhance regulatory capacity:\n  - Continue initiatives to raise regulatory acumen among FinTech participants.\n- Dynamic regulatory approach:\n  - Implement frequent refinements to regulation and supervision to align with rapid technological change.\n- Consider dual-framework risks:\n  - Design regulatory responses that address both conventional and Islamic finance implications of FinTech developments."
    },
    {
      "heading": "Publication and metadata",
      "content": "- Pages: 21\n- Volume: 2020\n- Issue: 058\n- Series: Country Report No. 2020/058\n- DOI: https://doi.org/10.5089/9781513531960.002\n- Stock No: 1MYSEA2020002\n- ISBN: 9781513531960\n- ISSN: 1934-7685\n- Subjects: Banking, Digital currencies, Financial services, Fintech, Islamic finance, Mobile banking, Technology\n- Keywords: Asia and Pacific, bank-Fintech partnership, Co-working space, CR, Digital currencies, Fintech, FinTech Association of Malaysia, Fintech firm, FinTech in Malaysia, firm, Global, ISCR, Islamic finance, Islamic FinTech, Malaysia, Mobile banking, Southeast Asia, start-up, tech company\n\nSource: Malaysia: Selected Issues (IMF Staff Country Report No. 2020/058).\n\n---\n\n Content in this bundle\n\n- Malaysia: Selected Issues; IMF Country Report No. 20/58; January 23, 2020\n  - Malaysia: Selected Issues; IMF Country Report No. 20/58; January 23, 2020 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Malaysia: Selected Issues; IMF Country Report No. 20/58; January 23, 2020 (PDF){rel=\"external\" type=\"application/pdf\"}"
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    "Published: February 28, 2020",
    "Series: IMF Staff Country Reports",
    "DOI: https://doi.org/10.5089/9781513531960.002",
    "Investigates impact of financial technology (FinTech) on Malaysia’s financial sector.",
    "Malaysia is digitally enabled to seize the opportunities brought by FinTech.",
    "Malaysian banks continue to dominate in deposits, lending and capital raising, but have been gradually reducing their emphasis on physical distribution networks.",
    "The top five Malaysian banks have increased their technology-related spending over the past three years.",
    "Regulators have been mindful of developments outside of the traditional regulatory perimeter that could pose financial stability risks.",
    "Rapidly evolving technology is likely to bring multiple challenges to the financial sector.",
    "Digital readiness: Malaysia is positioned to take advantage of FinTech-driven opportunities.",
    "Regulatory landscape:",
    "Capacity building:",
    "Sectoral scope:",
    "Supervision and regulation:",
    "Maintain balance between:",
    "Strengthen regulatory reach:",
    "Enhance regulatory capacity:",
    "Dynamic regulatory approach:",
    "Consider dual-framework risks:",
    "Pages: 21",
    "Volume: 2020",
    "Issue: 058",
    "Series: Country Report No. 2020/058",
    "DOI: https://doi.org/10.5089/9781513531960.002",
    "Stock No: 1MYSEA2020002",
    "ISBN: 9781513531960",
    "ISSN: 1934-7685",
    "Subjects: Banking, Digital currencies, Financial services, Fintech, Islamic finance, Mobile banking, Technology",
    "Keywords: Asia and Pacific, bank-Fintech partnership, Co-working space, CR, Digital currencies, Fintech, FinTech Association of Malaysia, Fintech firm, FinTech in Malaysia, firm, Global, ISCR, Islamic finance, Islamic FinTech, Malaysia, Mobile banking, Southeast Asia, start-up, tech company",
    "**Malaysia: Selected Issues; IMF Country Report No. 20/58; January 23, 2020**"
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