The subject of digital bank has been making wave in Malaysia especially now that Bank Negara is already prepping up to issue digital bank licenses. Quite a number of Malaysian companies and banks are apparently interested to apply for the license and looks like the Johor state government will be joining them as well.
The decision to establish Johor’s own digital bank was announced by the Menteri Besar of Johor, Hasni Mohammad earlier today alongside the creation of the State Economic Reform Committee (SERC). Chaired by the Menteri Besar himself, SERC will be joined by influential individuals and industry players within the economy sector although the full committee member list was not revealed in today’s announcement.
As for the upcoming Johor’s digital bank, the genesis behind its establishment is rather straight forward which is to boost the state’s digital and future economy as well as taking advantage of the increasing growth and potential of fintech industry. At the same time, the state government also believed that the digital bank could provide a more inclusive financial service to everyone.
While the on-going COVID-19 pandemic and Movement Control Order has forced Bank Negara to extend the consultation period for the digital bank license framework to end of June, it is quite interesting to see that a state government is going to participate in the industry as well. All in all, we expect that the interest in digital bank will continue to increase as we progress closer to having the first ever licensed digital bank in Malaysia.