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Free Malaysia Today
4 days ago
- Business
- Free Malaysia Today
MP moots special data centre to monitor ‘buy now, pay later' transactions
A recent survey by Shopee's BNPL service SPayLater found that 81% of 40,000 Malaysian users relied on BNPL for basic needs. (Rawpixel pic) KUALA LUMPUR : A Sarawak MP has urged the government to set up a dedicated data centre to monitor transactions under the 'buy now, pay later' (BNPL) scheme, separate from traditional credit reporting systems. Rodiyah Sapiee (GPS–Batang Sadong) said BNPL data should be excluded from the Central Credit Reference Information System (CCRIS), which is used to assess major loan applications such as for housing and vehicle financing. 'CCRIS is directly related to major loan eligibility such as for housing or vehicle financing, and if BNPL data is included, it could negatively impact the ability of lower-income users to obtain future financing,' she told the Dewan Rakyat when debating the Consumer Credit Bill 2025. Instead, Rodiyah proposed the creation of a dedicated BNPL data centre under the Consumer Credit Commission (SKP) which would allow targeted monitoring of BNPL credit risks without affecting users' primary credit histories. 'This will preserve BNPL's effectiveness as a microcredit instrument and a symbol of hope,' she added. Rodiyah cited a recent survey by Shopee's BNPL service SPayLater, which found that 81% of 40,000 Malaysian users relied on BNPL for basic needs, including baby formula and to pay medical expenses. 'This proves that BNPL is not just a financial convenience, but also functions as a micro social safety net during emergencies,' she said. She also suggested that the bill consider financial commitments at the household rather than the individual level. 'While BNPL limits are typically capped at RM2,000 or RM3,000 per person, in reality, a household may have several BNPL accounts that together exceed the family's actual financial capacity. In the end, the burden falls on the head of the household,' she said. Rodiyah also proposed giving BNPL exemptions to micro-businesses, which typically use the service as working capital to acquire short-term inventories. Deputy finance minister Lim Hui Ying earlier tabled the Consumer Credit Bill 2025 for second reading at the lower house. Lim said the bill had been drafted to regulate emerging credit providers such as BNPL companies, with the number of transactions increasing from 83.8 million in the second half of 2024 to 102.6 million in the first half of this year. The total transaction value of BNPL rose from RM7.1 billion in the second half of last year to RM9.3 billion in the first half of this year, an increase of 31%, she said. 'This rapid growth in BNPL may pose risks of harm, especially to vulnerable credit users,' she said. Under the bill, a statutory body known as the SKP will be created to regulate currently unregulated business sectors through a licensing and registration framework to protect those with loans not exceeding RM300,000.
Daily Express
4 days ago
- Business
- Daily Express
MP moots special data centre to monitor ‘buy now, pay later' transactions
Published on: Monday, July 21, 2025 Published on: Mon, Jul 21, 2025 By: Shermaine Choe, Minderjeet Kaur, FMT Text Size: A recent survey by Shopee's BNPL service SPayLater found that 81% of 40,000 Malaysian users relied on BNPL for basic needs. (Rawpixel pic) Kuala Lumpur: A Sarawak MP has urged the government to set up a dedicated data centre to monitor transactions under the 'buy now, pay later' (BNPL) scheme, separate from traditional credit reporting systems. Rodiyah Sapiee (GPS–Batang Sadong) said BNPL data should be excluded from the Central Credit Reference Information System (CCRIS), which is used to assess major loan applications such as for housing and vehicle financing. Advertisement 'CCRIS is directly related to major loan eligibility such as for housing or vehicle financing, and if BNPL data is included, it could negatively impact the ability of lower-income users to obtain future financing,' she told the Dewan Rakyat when debating the Consumer Credit Bill 2025. Instead, Rodiyah proposed the creation of a dedicated BNPL data centre under the Consumer Credit Commission (SKP) which would allow targeted monitoring of BNPL credit risks without affecting users' primary credit histories. 'This will preserve BNPL's effectiveness as a microcredit instrument and a symbol of hope,' she added. Rodiyah cited a recent survey by Shopee's BNPL service SPayLater, which found that 81% of 40,000 Malaysian users relied on BNPL for basic needs, including baby formula and to pay medical expenses. 'This proves that BNPL is not just a financial convenience, but also functions as a micro social safety net during emergencies,' she said. She also suggested that the bill consider financial commitments at the household rather than the individual level. 'While BNPL limits are typically capped at RM2,000 or RM3,000 per person, in reality, a household may have several BNPL accounts that together exceed the family's actual financial capacity. In the end, the burden falls on the head of the household,' she said. Rodiyah also proposed giving BNPL exemptions to micro-businesses, which typically use the service as working capital to acquire short-term inventories. Deputy finance minister Lim Hui Ying earlier tabled the Consumer Credit Bill 2025 for second reading at the lower house. Lim said the bill had been drafted to regulate emerging credit providers such as BNPL companies, with the number of transactions increasing from 83.8 million in the second half of 2024 to 102.6 million in the first half of this year. The total transaction value of BNPL rose from RM7.1 billion in the second half of last year to RM9.3 billion in the first half of this year, an increase of 31%, she said. 'This rapid growth in BNPL may pose risks of harm, especially to vulnerable credit users,' she said. Under the bill, a statutory body known as the SKP will be created to regulate currently unregulated business sectors through a licensing and registration framework to protect those with loans not exceeding RM300,000. * Follow us on our official WhatsApp channel and Telegram for breaking news alerts and key updates! * Do you have access to the Daily Express e-paper and online exclusive news? Check out subscription plans available. Stay up-to-date by following Daily Express's Telegram channel. Daily Express Malaysia
Malaysian Reserve
09-06-2025
- Business
- Malaysian Reserve
Smart spending or slippery slope
OVER the past few years, Buy Now, Pay Later (BNPL) services have gained remarkable traction in Malaysia. Platforms such as Atome, Grab PayLater, SPayLater and hoolah have become household names, offering consumers the chance to split their payments into manageable installments without the need for traditional credit checks or interest rates — at least at first glance. While these services have democratised access to consumer credit, especially for younger Malaysians and those underserved by traditional banks, they also come with considerable risks. As we look at the benefits and drawbacks of BNPL in Malaysia, it's clear that although this payment option can be helpful, it should be used carefully and with proper monitoring. Increased Financial Accessibility One of the most significant benefits of BNPL is its ability to provide credit access to individuals who might otherwise be excluded from traditional financing options. Many Malaysians, particularly younger consumers and gig economy workers, lack sufficient credit history or stable income to qualify for bank loans or credit cards. BNPL platforms sidestep these barriers, allowing more people to participate in the consumer economy. BNPL offers a convenient way to manage cashflow. Especially for salaried individuals who face short-term liquidity constraints, being able to spread out payments without paying interest (if payments are made on time) can be highly beneficial. This can be particularly useful for big-ticket purchases such as electronics or household appliances. Many BNPL services advertise them- selves as 'interest-free' if payments are made on time, which can be more affordable than traditional credit card debt that typically comes with high interest rates. For disciplined users, this can be a more cost-effective financing method. BNPL also provides a boost to local e-commerce and retail industries. By lowering the barrier to purchase, it encourages higher consumer spending. This is especially evident during major sales events like 11.11 or Aidilfitri promotions, where BNPL plays a key role in enabling consumers to buy more while spreading their expenses. Technological Convenience The user experience with BNPL apps is generally smooth, quick and integrated directly into the checkout process. Many Malaysians, who are increasingly digital-savvy, appreciate this seamless, app-based access to credit compared to the paperwork-heavy bank loan process. Despite the convenience and flexibility that BNPL services offer, it is important not to overlook the potential risks they pose. Consumers should approach these services with caution, evaluating their financial situation and the necessity of their purchases. Without careful consideration, what seems like a helpful short-term solution could turn into long-term financial strain. The most significant concern with BNPL is the ease with which consumers can accumulate debt. Because the barrier to entry is low and the approval process is quick, many users take on multiple BNPL plans simultaneously. Without a consolidated credit check across different platforms, it's easy for consumers to lose track of how much they owe — leading to over-indebtedness. Malaysia's regulatory framework for BNPL is still in its early stages. While Bank Negara Malaysia (BNM) and the Ministry of Finance (MOF) have signalled intent to regulate this space, the current environment allows BNPL providers significant leeway in their operations. This regulatory grey area poses risks to consumer protection, especially in terms of transparency, data privacy and dispute resolution. Although BNPL is often marketed as 'interest-free', many platforms charge significant late fees if payments are missed. These penalties can quickly add up, making what seemed like a good deal an expensive one. For financially vulnerable consumers, this can lead to a cycle of missed payments and escalating fees. BNPL inherently encourages spending beyond one's means. Because consumers are not required to pay the full price upfront, they may be tempted to make unnecessary or luxury purchases they would otherwise avoid. This can distort financial priorities, especially among younger users with less financial literacy. Unlike credit cards or traditional loans, most BNPL platforms in Malaysia do not report repayment behaviour to credit bureaus. This means that even responsible BNPL users gain little to no benefit in building their credit scores, which could affect their ability to access more substantial credit in the future. Impact on Malaysian Consumers The impact of BNPL on Malaysian consumers is deeply nuanced. On one hand, BNPL has become a crucial financial tool, especially amid rising living costs and economic uncertainty. For many Malaysians, particularly the bottom 40% (B40) and middle 40% (M40) income groups, BNPL offers a financial lifeline to purchase essential goods without overburdening their monthly budgets. However, the same flexibility that makes BNPL attractive can also be dangerous. According to reports by the Credit Counselling and Debt Management Agency (AKPK), there has been a noticeable uptick in the number of young Malaysians seeking debt management assistance — many of whom cite BNPL as one of their liabilities. This trend indicates a growing reliance on short-term credit solutions without corresponding financial education or planning. Another area of concern is the lack of transparency and standardised terms across platforms. Some BNPL providers impose different fees or require access to personal data that might be used for targetted marketing or even resold to third parties. This lack of uniformity can confuse consumers and lead to poor financial decisions. To address these challenges, Malaysian authorities must accelerate the implementation of regulatory frameworks that protect consumers without stifling innovation. The Financial Services Act and forthcoming updates to the Consumer Credit Act could provide the legal infrastructure needed to govern BNPL practices, enforce fair lending standards and ensure that providers operate with transparency. Moreover, financial literacy campaigns are crucial. Malaysians, particularly those in younger demographics, need to understand that BNPL is a form of debt — not a free pass to consume. Education efforts should emphasise budgeting, understanding interest and fees, and the importance of timely repayment. BNPL in Malaysia is a double-edged sword. While it provides a flexible, accessible credit alternative that can help consumers better manage their cashflow and make necessary purchases, it also poses significant risks when used irresponsibly. The growing adoption of BNPL reflects changing consumer behaviour and a broader shift toward digital financial services — a trend that is unlikely to slow down. For BNPL to be a force for good, it must be matched with responsible lending practices, clear regulations and informed consumer behaviour. Only then can it truly support Malaysia's financial inclusion agenda without creating a new generation of debt-strapped consumers. Intan Baha is the chief sub-editor/ production editor of The Malaysian Reserve. This article first appeared in The Malaysian Reserve weekly print edition
Malay Mail
22-05-2025
- Business
- Malay Mail
Four in five Malaysian SPaylater users rely on BNPL for emergencies, survey shows
KUALA LUMPUR, May 21 — A staggering 81 per cent of Malaysian Buy Now Pay Later (BNPL) users used SPayLater to help them through difficult times or financial shocks, according to a survey of over 40,000 users nationwide. ShopeePay's Fikir Sekarang, Bayar Kemudian survey revealed that users commonly turn to BNPL services for essential emergency purchases including baby milk formula, medical expenses, vehicle and home appliance repairs, and insurance or Takaful renewals. Additionally, 59 per cent of respondents see access to such credit services as essential for spending on necessities in the modern Malaysian economy, highlighting the critical role these services play in daily life. The study found that 63 per cent of users who previously resorted to informal lending methods, including pawn shops and unlicensed lenders, no longer need these risky alternatives after using SPayLater. Traditional banking appears to be failing many Malaysians, with 12 per cent feeling their credit needs are underserved by banks, while 18 per cent either lack access to or do not utilize banking services at all. More than half (55 per cent) of respondents admitted they lack access to credit beyond SPayLater and other BNPL products, revealing a significant gap between credit accessibility and rising living costs. Cash flow management drives primary usage patterns, with 57 per cent using SPayLater to better manage their finances, while 46 per cent use it to bridge budget gaps until their next salary payment. Emergency spending accounts for 32 per cent of BNPL usage, while 10 per cent of users rely on the service to fund their small business operations. From the results, responsible usage patterns emerge clearly, with 93 per cent of users pre-planning their monthly budgets to include SPayLater repayments, treating them 'similarly to monthly utility bills.' The service appears to improve financial management skills, as 89 per cent feel it has helped them manage their budget more effectively, while 95 per cent believe it has enhanced their debt management abilities. The trends were consistent with declining national BNPL delinquency rates, which dropped from 5.3 per cent in 2023 to 2.6 per cent in 2024 according to Consumer Credit Oversight Board data. ShopeePay did not disclose the methodology used for the survey or when polling was conducted. Recommended reading:
BusinessToday
21-05-2025
- Business
- BusinessToday
More Than Half of Malaysians Turn To Informal Lending To Survive
A recent survey of over 40,000 Malaysians has laid bare a financial reality long hidden beneath the economic statistics: For many, access to formal credit remains out of reach, pushing them toward informal and often risky borrowing practices to make ends meet. The findings, released by a prominent Buy Now, Pay Later (BNPL) service, paint a stark picture. At one point, more than half of Malaysians lacked access to formal credit, forcing them to rely on pawnshops, unlicensed moneylenders or borrowing from family and friends. However, the rise of digital BNPL solutions like SPayLater appears to be shifting the landscape, offering a lifeline to those previously locked out of the formal financial system. According to the data, 63% of users who previously depended on informal borrowing no longer feel the need to do so since using SPayLater. The service has helped to unlock access to short-term credit, especially for those excluded from the traditional banking system. Yet, the data reveals a persistent divide: 55% of respondents still lack access to traditional credit services beyond BNPL, exposing a growing reliance on alternative financing tools amid limited options from conventional banks. This is further exacerbated by the 18% of users who either do not use or cannot access banking services at all, and another 12% who say their credit needs are unmet by the banking system. For many Malaysians, short-term credit has become not just a convenience but a necessity. 59% consider access to credit essential for purchasing everyday necessities, a sentiment amplified during times of financial stress. A striking 81% of users have relied on SPayLater to weather financial shocks, such as emergency medical expenses, vehicle repairs, baby formula and insurance renewals. Further exploring why users use BNPL, the survey found that: 57% use SPayLater to better manage their monthly cash flow 46% use it to bridge the gap between paychecks 32% use it to handle unexpected expenses 10% use it to fund small business operations Importantly, most users approach BNPL with discipline. 93% of respondents budget for their repayments, treating them like monthly utility bills. As a result, 89% say it has helped them manage their spending and 95% credit the service with improving their debt management skills, a promising sign for Malaysia's broader push toward financial literacy. This financial discipline is having measurable effects. National BNPL delinquency rates dropped from 5.3% in 2023 to 2.6% in 2024, according to the Consumer Credit Oversight Board, a trend that mirrors the decline in late payments reported by SPayLater users. Still, the data reflects a complex relationship with short-term credit. While 42% of users say BNPL gives them more control over their finances, a smaller segment, around 2%, expressed anxiety about needing credit just to afford basic necessities. The solution, many say, lies in greater integration of BNPL services into essential sectors, pointing to an urgent need for credit access in areas tied directly to daily living. As Malaysia continues its journey toward a more inclusive digital economy, these findings spotlight a critical question: Can the financial system evolve fast enough to serve those left behind? If BNPL's growth is any indication, the demand is not just real, it's urgent. Related
