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17 MAY 2019


Yang Berbahagia Datuk Syed Zaid Albar,
Chairman Securities Commission Malaysia,

Members of the Media,

Ladies and Gentleman.

Good morning and Salam Harapan!


1. Thank you Securities Commission Malaysia (SC) for inviting me this morning to the 2019 Fintech Roundtable.

2. It is encouraging to witness the strength-to-strength growth of the fintech industry and I am looking forward to hearing from the industry players on the latest developments.

Ladies and gentlemen,

3. The digital economy plays a crucial role in Malaysia’s journey towards becoming a high-income nation. On average, our digital economy had grown 9% annually in value-added terms between 2010 to 2016, making its growth faster than Malaysia’s overall GDP growth. Furthermore, the International Data Corporation (IDC) predicts that by 2022, over 21% of Malaysia's GDP will be digitalised against the current level of 18%.

4. Given its prominent role as a source of expansion, the Government is committed to drive Malaysia’s digital economy agenda in an inclusive and sustainable manner that benefits the rakyat. This means crafting policies and supporting market initiatives which plug the gaps of the traditional banking system by leveraging on technological developments.

5. In line with this, the SC has been leading the development of facilitative frameworks, since 2014, to introduce innovative market-based financing avenues such as equity crowdfunding (ECF) and Peer-to-peer (P2P) financing to cater for the growing financial needs of our Micro, Small & Medium Enterprises (Micro-SMEs).

6. Thus, we are seeing more digital innovations making inroads into the capital market domain recently, giving rise to the emergence of new digital players such as digital investment manager, digital-only broker and digital distribution platform – offering simplicity, convenience and accessibility for investors to use their services at any time, at an affordable cost. All this is part of SC’s ongoing efforts to enhance financial inclusion, through technology.


7. The significance of Micro-SMEs in the Malaysian economy goes beyond just being the engine of growth. They contribute 37% of the Malaysian GDP in 2018 and is projected to rise to 41% by 2020. They comprise about 98.5% of total business establishments in the country and employ two-thirds of all workers in Malaysia. As such, spurring the development of Micro-SMEs to ensure their competitiveness and scalability is imperative.

8. The potential of fintech to boost Micro-SME development is widely recognised, especially where it provides access to more diverse funding options. From the SC Chairman’s opening remarks, we have seen how ECF and P2P financing platforms in Malaysia have helped about 900 Micro-SMEs to successfully raise a total funding of RM344 million via more than 3,400 successful deals since 2015. For ECF financing, the range of funding obtained is between RM130,000 to RM 3 million, with the median being RM750,000. Where for P2P financing, the range of funding obtained is wider that is between RM1,000 to RM1 million and with the median being RM14,000. With the potential of sourcing such a wide range of funding amounts, ECF and P2P financing has the potential to be a fundraising platform for all types of businesses.

9. Of the total 11,261 investors, 53% or 5,969 investors are less than 35 years old. The appeal of these alternative and innovative forms of investments to the younger audience is potentially due to the opportunity to engage with businesses from an early stage and the ease of access due to digitisation.

Ladies and gentlemen,

10. Through the power of the “crowd”, market-based financing platforms such as ECF also allow entrepreneurs to interact with their customers who are themselves investors – to shape and refine product ideas. As such, crowdfunding is a great asset to businesses and entrepreneurs, generating much needed revenue and increasing the customer base, while at the same time aiding our country’s economy.

Innovative mechanisms to meet funding needs

11. To boost the development of market-based financing which has shown great success in funding Micro-SMEs, the Government has also committed RM50 million towards a co-investment fund (CIF) for ECF and P2P investments.

12. The CIF will match investments from private investors on a one-to-four basis, i.e. RM1 from government and RM4 from private investors. The objective of this scheme is to amplify government effort in providing access to financing to the deserving Micro-SMEs, as well as providing greater transparency on how public funding are being utilised. I hope the ECF and P2P financing operators would take this opportunity to embark on this mutually beneficial initiative.

Raising Financial literacy

Ladies and gentlemen,

13. The fintech wave is shaping the financial landscape in a variety of ways, leading to the introduction of new business models and solutions. Consumers are now exposed to a wider range of financial services and products. Businesses have a multiple financing avenues besides the traditional banks.

14. The low financial literacy among young Malaysians and retirees is of significant concern. A study by S&P Global Literacy Financial Survey in 2014 reported that financial literacy rate in Malaysia is only at 36%, compared with 59% in developed countries. We need to educate them on the benefits and risks, and ensure that the decisions taken by these stakeholders are informed and well thought out.

15. Given that fintech players are now an integral part of our broader ecosystem with their power to bring in innovation, agility and new sources of financing, the onus is on the stakeholders from the financial services ecosystem to take steps towards driving financial awareness and literacy among consumers, investors, lenders, and businesses.


16. As reported by the World Bank1 in 2018, Malaysians have shown impressive entrepreneurial talent, producing some of Southeast Asia’s most recognizable digital startups. Deep digital adoption and access to financing for all provides the foundation for an inclusive and sustainable digital economy. This will require a coordinated approach from the public and private sectors, guided by a common vision of an economy that matches technological developments with skilled workers - in a context of predictable regulations, transparent public institutions and competitive markets. Malaysia has what it takes to establish a creative or innovative digital cluster - namely the 3Ts of Talent, Technology and Tolerance of new ideas. Only under this new Government that respects the freedom of expression, do we have the critical third ‘T’ of tolerance, essential towards nurturing new and creative ideas.

17.  With that, I look forward to hearing the views of the participating capital market Fintech players at the roundtable later on your unique digital business propositions, its potential benefits and new capabilities to the economy, and how we can work together in creating an inclusive environment for all as we head into the digital era.

Thank You.