Muhammad bin Ibrahim: The dawn of a new era in Malaysia's payment systems Keynote address by Mr Muhammad bin Ibrahim, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Malaysian E-Payments Excellence Awards, Kuala Lumpur, 22 May 2017. * * * I am glad to be with you at this 2nd Malaysian E-Payments Excellence Awards organised by MyClear. This evening, we are recognising the contributions of the financial industry, businesses and government agencies to the country’s e-payment agenda. The achievements showcased by the award winners today reflect the broader innovations and involvement that we continue to witness in the payment space to make e-payments more convenient, cost-efficient and safe for users. I am encouraged that contactless payments, for example, are gaining greater appeal for smaller value payments. Equally important have been the collective efforts made to educate and inform users. This helps to drive changes in payment habits away from cash and cheques to epayments. Malaysians are increasingly embracing e-payments Malaysia has long recognised the importance of e-payments as a key enabler to drive national efficiency and competitiveness, and as a catalyst to facilitate the creation of new sources of growth. Promising progress has been made in achieving the country’s e-payment targets. In a period of 6 years between 2011 and 2016, the number of e-payments per capita has almost doubled from 49 to 97 transactions per capita. This largely reflects the accelerated adoption of electronic fund transfers to displace cheques.
Significant efforts will be devoted towards increasing the acceptance of MyDebit, particularly among lower-tier merchants to lessen the use of cash to lower the operational costs for businesses. Some of the initiatives that will be undertaken by PayNet include enabling MyDebit to be used on mobile phones and operating a ‘shared token service’ for the local payment industry. In addition, PayNet will also expand the use of MyDebit to pay for transit services, including buses and trains, within the coming year. Supporting more inclusive governance arrangements through the transformation of NPAC While we can look forward to developments that will further transform our payment systems, the process also matters. Since the establishment of the National Payments Advisory Council (NPAC) in 2001 to advise on 3/5  BIS central bankers' speeches  and steer payment system development in Malaysia, we have worked to put in place a more inclusive process for setting the payment agenda. This aims to reflect the changing make-up of the payment industry and better anticipate the changing demands of users. We cannot hope to future proof the system without a good pulse on the expectations, constraints and incentives that drive payment behaviours and decisions to invest in innovation. It also often determines how quickly or slowly we can roll out planned initiatives, or even stay the course on these plans. This led to changes that were introduced last year to broaden the representation of the NPAC to include stakeholders on both the demand and supply sides of the payment market.