22 May, Kuala Lumpur – INCEIF students and staff today had an interactive session on the latest developments in Fintech with members of the Fintech Association of Malaysia (FAOM) and the Bank Negara Malaysia (BNM) team in charge of Fintech.
The Financial Technology Enabler Group (FTEG), an inter-department working group within BNM, recently launched “Fintech Hacks”, a call for participation to enable the public to submit ideas and problems to improve financial services sector by leveraging on new and emerging technologies. The aim of this initiative is to identify the pain points in financial services and understand different viewpoints for stakeholders on the challenges in adapting to digital transformation as well as potential solutions that could address the problem.
Today’s engagement with the INCEIF community is part of the “Fintech Hacks” initiative. Apart from soliciting ideas on ways to improve financial services, the session also created awareness on Fintech and highlighted career opportunities in that specialisation.
Fintech, the application of technology in the financial services sector, is not entirely new. However, the high adoption and reliance on mobile and higher inter-connectivity through the internet have led to rapid innovation for financial technology. Moreover, emerging technology has led to the creation of various business models that improves and simplifies financial transaction which 10 or 20 years ago seemed impossible.
Fintech is already being adopted by several Islamic banks in its operations. One good example is the Investment Account Platform (IAP) which provides an online investment platform to secure funding for projects, linking individuals, companies and rating agencies.
In his presentation, FAOM member Mohammad Ridzuan Abdul Aziz said all businesses involved in the buying and selling of products and services now need to face up to the reality of Fintech: what it is, how it works, and how to take advantage of it.
“As an industry player, FAOM welcomes BNM’s FinTech Regulatory Sandbox Framework which was introduced in response to the rapid development in financial technology innovations. This has sparked interest among stakeholders particularly standalone Fintech companies, existing licensed financial institutions, consumers as well as technology providers to be involved in this key and exciting development.
“This gives an opportunity for stand-alone Fintech companies to be authorised to offer their services, especially to the under-banked and un-banked. This is in-line with BNM’s aspiration to enhance financial inclusion by empowering consumers via democratisation of financial services.
“As a regulatory compliance consultant, our involvement includes providing input, comments and ideas for consideration of various regulatory agencies within the ASEAN region and sharing knowledge with as many aspiring interested parties,” said Ridzuan who is Director & Co-Founder of RHT Compliance Solutions.
The Sandbox is a structured approach by BNM in considering various types of new financial technology innovation and its implications on various stakeholders, whether it is to be introduced by an existing financial institution or a standalone Fintech company or collaboration of both.
The Sandbox allows BNM to introduce new Fintech in a controlled live market environment with specific parameters, addressing specific consumer needs, and with specific deliverable and timelines. BNM is clear that the Sandbox cannot be used to circumvent any of the existing laws and regulations under its administration.
Ridzuan said FAOM also welcomed INCEIF students to apply for internships or consider a career in Fintech companies.