The Inside Story of Finance Technology in Malaysia

The Inside Story of Finance Technology in Malaysia

As digitalisation permeates the lives of most in Malaysia, the endeavours of banks in the country to reach digital maturity by 2020 are spurred by the growing demands of Malaysian consumers.

With more than 50 per cent of the population convinced that “Malaysia’s digital economy is a work in progress” and 98 per cent calling for “organizations to provide safe and secure online transactions”, as reported by EY, the banking and financial industry is facing pressure to improve its Fintech capabilities to better serve consumers. 

This is driving rapid growth in e-payment transaction in the past few years. According to The Edge Markets, the transaction value per capita increased from RM550,703 in 2016 to RM668,785 in 2018. The volume of e-payment transactions per capita rose, from 97.5 in 2016 to 124.6 last year. At the same time, reliance on cheques had reduced; the transaction value and volume per capita for cheques fell from RM52,646 in 2016 to RM44,215 in 2018 while volume reduced from 4.2 to 3.1.

 

MORE TALENT NEEDED TO KEEP PACE WITH GROWING CONSUMER DEMANDS

To keep pace with growing demands, financial institutions have been ramping up their efforts to partner with local Fintech companies and enhance the former’s capabilities in know-your-customer (KYC) processes, anti-money laundering and digital identity management, which encompasses facial and voice recognition. The collaborations would ultimately result in enhanced blockchain-enabled remittance services, online loan processes, digital wallets and wealth management.

As a result, both banks and Fintech firms have been on the lookout, in the talent-starved market, for talent such as software developers, cloud engineers, network engineers, cyber security engineers, project managers and data scientists. Qualifications-wise, while the working experience of candidates is of utmost importance, professional certifications are also useful for candidates to highlight their knowledge on subject matters. 

In addition, due to the growing relevance of cyber security in banking and insurance, as well as the digitalisation of transactions, employers are also looking for candidates with both experience and recognised qualifications in data analysis.

The majority of those currently making their way into FinTech in Malaysia are in the first ten years of their career or straight out of education. However, a large amount of this demographic, the techies of the future, do not see the industry as one that is beneficial to their careers. In light of this shortage of highly skilled candidates, employers are seeing both self-promotion and training as essential to the enticement of the younger generation of tech whiz-kids.

INDUSTRY CROSS-OVERS ADDRESS THE FINTECH TALENT SHORTAGE

As well as homegrown, youthful talent, employers are looking outside of regular circles. While financial services have historically been quite conservative, Malaysia’s FinTech arena is seeing a change in the past year where companies are attempting to attract candidates from other fields. We are seeing even those without IT backgrounds attracted to the opportunities entailed in these offers.

These newcomers to the industry are trained by the financial stakeholders, allowing them to fulfil their potential in spite of their lack of history in the industry. And it is not just those at home, but Malaysians who have been educated or working abroad are being encouraged to return with government subsidies. This increasingly open-door policy that has been seen in the past twelve months is expected to continue into the next year.

As with the findings in the 2019 Hays Asia Salary Guide, across the board employers in Malaysia are more focused on hard skills over soft skills when meeting their hiring demands in the near future. 60 per cent of hiring managers are more inclined to employ staff based on their technical aptitude, with statistical analysis and data mining (voted by 55 per cent), project management (voted by 52 per cent), and computer skills (voted by 44 per cent) being the top technical skills in demand. Such statistics are in line with the Fintech arena, where even the senior management leading high-tech intensive projects are required to know the inner workings of the technology driving the firms’ Fintech endeavours.

MORE FIRMS WILL FOCUS ON EMPLOYER BRANDING TO REEL ADEPT TALENT, DEFYING TRADITIONAL HR PRACTICES

The jobs market is becoming increasingly active, leading financial organisations to find less traditional, more unorthodox ways of attracting candidates. Rebranding is one, with many companies painting themselves as media-savvy and digital-centric, setting up separate FinTech branches to increase their brand market share. As banks, in particular, continue to do this over the next 12 months, they can see their brand identity grow and with that, bring themselves to the attention of desired candidates.

As another means to address the talent shortage, firms have been attempting to attract overseas returnees while reducing their reliance on foreign talent. Adept Fintech talent are usually able to negotiate for competitive salary packages on top of relocation incentives and assistance. Both financial institutions and Fintech firms have also been reviewing their talent attraction strategies that go beyond financial incentives to lure candidates. Although it has been noted that local banks remain relatively traditional when it comes to non-monetary benefits, they are urged to design their HR practices and stay competitive against Fintech firms. They could benefit from implementing practices such as flexible working and work-from-home arrangements, alongside transparent bonus and promotion schemes.