Over the past five years, significant efforts have been undertaken to modernise Malaysia’s retail payment infrastructure and migrate away from inefficient paper based payment instruments such as cash and cheques. Good progress has since been made, especially in the displacement of cheques. The annual decline rate had accelerated from an average of –1.6% in 2011 to 2013 to –10.1% in 2014 and –16.5% in 2015. Concurrently, there is also an increase in the uptake of electronic fund transfer services. The annual growth rate for the Interbank GIRO (IBG) had increased from an average of 18.8% prior to 2013 to 34.1% in 2014 and 2015. The Instant Interbank Funds Transfer (IBFT) service had also recorded encouraging growth where its annual growth rate of over 60% since 2011 had further increased from 67.8% in 2014 to 76.7% in 2015, signifying greater confidence in the use of e-payments. However, we must not be complacent. As we move forward, there are two technology trends that hold immense promise to revolutionize the payments market. The first is the proliferation of mobile technology and ubiquitous communications. Increasingly, mobile devices are the preferred channel for consumers to make payments conveniently from anywhere and at any time. The second is the ability to process payments and move funds instantaneously around the clock. Towards this end, Bank Negara Malaysia’s wholly-owned subsidiary MyClear has initiated a multi-year program to modernise Malaysia’s payment infrastructure.
The key thrust of this plan is to develop a new real-time Retail Payments Platform that will serve as both a catalyst and enabler for innovative payments in Malaysia. This should meet the needs of consumers and businesses who increasingly expect payments on-demand where funds are available to the recipient immediately. In this regard, I would like to call upon the financial industry to jointly work with MyClear in the development of such new real-time Retail Payments Platform. Conclusion Payment and Settlement Systems are the foundation that underpin the financial market infrastructure and serve as a catalyst for economic growth. Hence, efforts to promote the  BIS central bankers’ speeches  3  resilience, interoperability and competition of such systems are of utmost importance. This has been and will continue to form the key thrust in Bank Negara Malaysia’s policy work in delivering our mandate of fostering safe, efficient and reliable payment systems. There are immense opportunities and new sources of growth including expanding financial accessibility to the underserved that is made possible from greater standardization and interoperability of the payment systems, as well as, innovation. Hence, in today’s rapidly evolving and highly competitive environment, the financial community should capitalise on such enabling environment, and collaborate through standardisation and interoperability, to lower costs, foster innovation and deliver better value proposition and choices to their customers. 4  BIS central bankers’ speeches