PUC Bhd, together with its consortium of strategic partners, are the latest contenders for a digital bank licence. The deadline to apply for a handful of digital banking licenses passed on Wednesday (June 30).
The ACE Market-listed company said its consortium was formed under the digital banking framework issued by Bank Negara Malaysia (BNM) with its members recognising the gap presented by the under-served segments which include micro, small and medium enterprises (MSMEs) and B40 segment consumers in Malaysia.
“PUC’s advanced digital ecosystem, Presto, encompasses e-commerce, logistics, e-wallet, loyalty, financing and payment solutions which will form a natural complement to the digital bank and enable it to drive innovation and boost digital transformation through its service offerings,” the company pointed out.
Yesterday, an iFAST Corp Ltd-led consortium has joined the race for Malaysia’s digital bank licence after Paramount Corp Bhd also led a consortium comprising Star Media Group Bhd, RCE Capital Bhd, Prosper Palm Oil Mill Sdn Bhd and a technology partner to submit a similar application to the central bank recently.
To re-cap, BNM is pushing digital bank operators to encourage Malaysians to make more digital transactions. Going cashless has gained a certain imperative amid the pandemic.
Its focus is on the unserved and underserved customers such as those facing challenges accessing conventional banks due to a lack of information or because they have higher risk profiles, low levels of financial literacy or limited understanding of how to access financial services.
Also included in this group are customers who live in areas not served by physical banks.
Nomura Securities Malaysia Sdn Bhd Malaysia equity research head Tushar Mohata opined that digital banks could pose a price threat to conventional lenders.
“While by definition having digital banks focus on the underserved and unserved markets should mean limited competition for the incumbents,” he told Nikki Asia.
“We are cognisant that competition will intensify in select segments such as deposit pricing, fees, and later, loan pricing where there might be some overlap with conventional banks.” – July 2, 2021
