KUALA LUMPUR, May 4 — Malaysia's six largest banking groups by assets are well positioned to face competition from innovative digital banks following the announcement of five new digital entrants announced by Bank Negara Malaysia recently.
According to Moody’s Investors Service, the new entrants would increase deposit competition in the consumer and small business segments, however the six largest banks will be able to fend off the competition due to their entrenched franchises and ongoing digital enhancements that will increase customer stickiness.
It said they also benefit from the government efforts to promote payment efficiency and interoperability, which include the implementation of DuitNow and DuitNow Quick Response code, the country’s real-time retail payment system and standardised QR code respectively. “In addition, the entry of digital banks will not materially affect the market shares of the largest incumbents over the next four to seven years because these digital banks will remain small,” Moody’s Investors Service opined.
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Malaysia's large banks able to face competition from innovative digital banksKUALA LUMPUR: Malaysia's six largest banking groups by assets are well positioned to face competition from innovative digital banks following the announcement of five new digital entrants announced by Bank Negara Malaysia (BNM) recently.
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