Citi says all corporate transactions in M’sia to be fully digitised by 2019

Citi says all corporate transactions in M’sia to be fully digitised by 2019

19 April, 2018

KUALA LUMPUR: Citibank Bhd expects all transactions by its corporate clients to be done entirely via the digital space next year, making it the first bank in the country to achieve a full digital service, as Malaysian corporates continue embracing digitisation.

Citi managing director of Asean cash product management and Malaysia country head Noel Saminathan said corporates in Malaysia have been rapidly shifting towards digitised channels, with 98% of its corporate transactions now digital, compared with about 60% a decade earlier.

“We have set ourselves a goal that by 2019, we will be a completely digital service provider for corporate payments,” Noel said at a press conference yesterday at the Citi Digital Forum.

As a result of the high percentage of digital transactions, he said the corporate segment is entirely managed via just three branches in Kuala Lumpur, Penang and Johor Baru, as clients no longer need to visit the physical branch for most transactions.

He thinks Citi will likely be the first bank locally to provide a fully digital service. “There is no bank in Malaysia that I know of which has achieved fully-digital service,” he said. He added that Citi invests about US$100 million (RM389 million) per year globally in its corporate payments space to continuously build on and improve their services. This digital push is important, he said, noting the government has forecast at least 20% of the country’s gross domestic product (GDP) will be contributed by the digital economy by 2020.

He also highlights Bank Negara Malaysia’s (BNM) initiatives to drive the adoption of e-payments. Currently, only about 50% of payments take place on e-payment channels, he said, as the country has largely been relying on cash and cheques. Malaysia, he said, should be able to achieve a wider adoption of e-payments, similar to how cash-based China transformed its payment systems.

“Now, the focus is on reducing cash usage, especially for small value transactions such as for items at hawker stalls or grocery shops. This is where the next phase comes in, the e-wallets. We have been hearing a lot of news related to e-wallets, from AliPay and WeChat Pay in China, to Maxis’ MaxisPay and AirAsia’s BigPay,” he said. On that note, Noel said Citi is excited about the Retail Payment Platform (RRP) to be launched by BNM in September this year, which includes plans for a national standardised QR code system.

“When that is launched, there is almost no reason for any of us with a smartphone to not use e-payments, as everyone will be able to scan a QR code and make payments directly from our bank accounts. This will make a significant impact in reducing cash usage.”

Source: The Edge Markets

Photo Source: Citi