KUALA LUMPUR: Today, the United Nations Capital Development Fund (UNCDF), Bank Negara Malaysia (BNM), and Malaysia Digital Economy Corporation (MDEC) launched the Digital Finance Innovation Hub to further support the financial inclusion of Malaysia’s middle and low-income people.
The objective of the Digital Finance Innovation Hub is to enable service providers, including financial institutions and fintech start-ups, to use technology in promoting inclusive finance, including through the introduction of products and services that meet the needs of the underserved in Malaysia. The hub also seeks to build a community of innovative and resourceful developers and collectively work towards Malaysia’s financial inclusion goals.
Whilst it has attained one of the highest levels of financial inclusion among countries in the region, Malaysia is keen to further raise the bar in developing an inclusive and progressive financial system. To this end, Malaysia views digital innovation as an important enabler to not only reach out to the remaining underserved population, but also to achieve overall greater impact and higher economic efficiency in financial intermediation, in terms of cost reductions, greater choice, faster provision and effective utilisation of financial services.
The Innovation Hub will draw upon Malaysia’s experience in advancing financial inclusion, infused with UNCDF’s innovative approaches from its programmes in other countries. Participating service providers will be able to build upon the cross-fertilisation of ideas and market research generated via the Hub to expand their services to meet the needs of the underserved in Malaysia and beyond.
Commenting on the launch, Datuk Yasmin Mahmood, Chief Executive Officer of Malaysia Digital Economy Corporation (MDEC) said: “This initiative implemented with the United Nations Capital Development Fund (UNCDF) and Bank Negara Malaysia is a significant stride forward in further boosting our national digital inclusivity goals. The Digital Financial Innovation Hub symbolises the importance of collaboration among all stakeholders in building a solid base between key agencies and industry to offer opportunities for Malaysians to both benefit from as well as participate in the building of financial inclusion, which is a vital aspect in the new economy.”
Stefan Priesner, UN Resident Coordinator for Malaysia, said, “This enriching partnership leverages Malaysia’s financial inclusion position and experience to spark further innovations in digital finance towards meeting the UN’s Sustainable Development Goals (SDGs).
The Digital Finance Innovation Hub and Inclusive Fintech Accelerator Program are supported by Metlife Foundation, and are part of the i3 Program to promote digital financial inclusion in Malaysia, China, Bangladesh and Vietnam.
“At MetLife Foundation, we believe that financial health should be within every person’s reach. The goal of the i3 program is to improve financial health of low to moderate income individuals by using the power of innovation, technology and behavioural insights. This program was collaboratively designed by MetLife Foundation and its grantees which include UNCDF and LumenLab, MetLife’s Innovation Center in Asia. We are delighted to have the support and cross-sectoral collaboration from both government as well as non-government and private sectors for this. In 2018, we plan to cover Malaysia, Bangladesh, China and Vietnam under the i3 Program to achieve the ultimate goal of improving financial health for everyone,” said Ramzi Toubassy, Chief Executive Officer, AmMetLife Insurance Berhad.
By fostering collaboration across the public and private sector and between established institutions and new entrants, the UNCDF Digital Finance Innovation Hub is expected to contribute to positioning Malaysia as a testbed for fintech solutions, whilst strengthening its position as a leader in financial inclusion.
The UNCDF has also partnered with BNM and MDEC to launch the Inclusive Fintech Accelerator Program, a program aimed at solving specific financial inclusion pain points in Malaysia, surrounding four key areas: spending, saving, borrowing and financial planning. The Inclusive Fintech Accelerator Program will be the first of a series of accelerator programs to be organised jointly by UNCDF, BNM and MDEC. Fintech start-ups will be invited to share their interest to participate in the upcoming accelerator programs and other activities to be organised via the Hub.
The UN Capital Development Fund (UNCDF) makes public and private finance work for the poor in the world’s 47 least developed countries. With its capital mandate and instruments, UNCDF offers “last mile” finance models that unlock public and private resources, especially at the domestic level, to reduce poverty and support local economic development. By identifying market segments where innovative financing models can have transformational impact in helping to reach the last mile and address exclusion and inequalities of access, UNCDF contributes to a number of different SDGs. To know more, visit www.uncdf.org
About Bank Negara
Bank Negara Malaysia (the Central Bank of Malaysia), is a statutory body mandated to promote monetary and financial stability aimed at providing a conducive environment for the sustainable growth of the Malaysian economy. The Central Bank’s functions include supervising the financial institutions and overseeing the nation’s payment systems infrastructure. Visit www.bnm.gov.my for more information.
About Malaysia Digital Economy Corporation (MDEC)
Malaysia Digital Economy Corporation or MDEC (formerly known as Multimedia Development Corporation Sdn. Bhd.) is the lead agency in driving the digital economy in Malaysia under the Ministry of Communications and Multimedia Malaysia. Since its inception 22 years ago, MDEC’s mission is to develop the nation’s digital economy. MDEC’s implementation efforts are centred on driving investments, building local tech champions, catalysing digital innovation ecosystems and propagating digital inclusivity.
MDEC is also responsible in ensuring that Malaysia plays an integral part in developing and nurturing talent to drive digital innovation around the world, while attracting participation from global ICT companies to invest and develop cutting edge digital and creative solutions in the country. To know more about MDEC’s efforts and initiatives, please visit https://www.mdec.my/
About i3 Program
The i3 program catalyzes digital technology for the financial inclusion of low-to-moderate income people in Bangladesh, China, Malaysia and Vietnam. People with low-to-moderate income lack access to appropriate formal financial services and therefore struggle to manage their limited resources and cash flows. i3 focuses on researching their needs, aspirations and behaviour to build and deliver digital financial services for the mass market. The programme is funded by the MetLife Foundation and implemented by UNCDF and MicroSave.
The i3 program leverages digital technology and uncovers deep insights into low – and moderate-income (LMI) people’s needs, aspirations and behaviours in order to build and deliver financial services for the mass market. LMI people have limited options that could drive usage of formal financial services and so struggle to manage their limited resources and cash flows. The program is funded by the MetLife Foundation and implemented by MicroSave and UNCDF.
About MetLife Foundation
MetLife Foundation was created in 1976 to continue MetLife’s long tradition of corporate contributions and community involvement. Since its founding through the end of 2017, MetLife Foundation has provided more than USD 783 million in grants and USD 70 million in program-related investments to organizations addressing issues that have a positive impact in their communities. In 2013, the Foundation committed USD 200 million to financial inclusion, and our work to date has reached more than 6 million low-income individuals in 42 countries. To learn more about MetLife Foundation, visit metlife.org.