For a region where socioeconomic disparities are wide, where the rural-urban divide is pervasive and considerable segments of society are still excluded from the economic and social mainstream, these developments have enormous potential to transform the current state to one where the financial needs of all segments of society are catered to. Several pre-conditions however must exist to realise this potential, and they all have to do with securing the trust and confidence of consumers in the digital financial system. This includes a regulatory framework that is appropriate and proportionate, a secure digital financial infrastructure and incentive systems that are aligned with providers that are both responsive and responsible. In Malaysia, efforts that are underway to enact a new Consumer Credit Act will further strengthen the foundations for the development of consumer finance in the digital age. The proposed legislation is important on several levels. First, it will reinforce fundamental protections provided to consumers in the provision of credit, including that provided by a growing number of nontraditional entities through digital solutions. Second, it will institutionalise inter-agency arrangements between authorities responsible for regulating consumer credit activities to promote consistent minimum protections and fair treatment of borrowers. And third, it will provide stronger assurance of more responsive and coordinated consumer protection arrangements to take into account the fast-evolving financial services landscape going forward. Equally important is a strong focus on financial education to promote financially and digitally literate consumers.
In all cases, an indispensable ingredient of success has been an honest acknowledgement of the problem accompanied by the genuine desire of all the social partners to work out an effective solution in the national interest. In the current circumstances, sitting on the fence is not a responsible option. Not only does it become an uncomfortable position to maintain, but it also becomes less credible with time. There is indeed the danger that anybody who is not willing to be part of the solution will be perceived to be part of the problem. I, therefore, feel obliged to call on all the social partners to adopt a long-term perspective and sign up to a substantial reform package which would lay the foundations for renewed growth and sustainable development. A thriving economy is the best social policy. BIS Review 67/2004  5