Open Banking and Financial Inclusion: Reaching Malaysia’s Unbanked and Underbanked

Unlocking Opportunity for Malaysia’s 13% Unbanked

Malaysia stands at a pivotal moment in its financial evolution. While the nation boasts a digital economy contributing over 22% to GDP and internet penetration at 97%, approximately 13% of Malaysians remain unbanked—excluded from the formal financial system and the opportunities it brings. Open banking, powered by digital platforms, mobile-first solutions, and API-driven partnerships, offers a transformative path to bridge this gap and drive true financial inclusion.

The Promise of Open Banking for Financial Inclusion

Open banking is fundamentally about democratizing access to financial services. By enabling secure, consent-driven data sharing between banks, fintechs, telcos, and other ecosystem players, open banking can:

Lower barriers to entry for underserved populations by leveraging digital and mobile channels.
Enable innovative, tailored products that address the unique needs of the unbanked and underbanked.
Foster partnerships that extend the reach of financial services into rural and remote communities.
Reduce costs and friction in onboarding, payments, and credit assessment, making banking more accessible and affordable.

Malaysia’s rapid adoption of digital payments—80% of retail transactions are now digital, and over 75% of transactions occur via internet and mobile banking—demonstrates the readiness of its population for new, inclusive financial models.

Digital Platforms and Mobile-First Solutions: The New Front Door to Banking

The surge in smartphone usage and e-wallet adoption (with over 56% of Malaysians using Touch’n Go e-wallet) has created a fertile environment for mobile-first banking solutions. These platforms are not just digitizing traditional services—they are reimagining the banking experience for those previously excluded:

Lightweight, intuitive apps that work on low-cost devices and limited data connections.
Seamless onboarding using digital identity verification and alternative data sources, reducing the need for physical documentation.
Personalized financial products—from micro-savings to micro-loans—designed for the realities of low-income and informal workers.

API-Driven Partnerships: Extending Reach Through Collaboration

Open banking’s true power lies in its ability to foster collaboration across the financial ecosystem. In Malaysia and across Southeast Asia, banks are increasingly partnering with fintechs and telcos to:

Leverage telco data for alternative credit scoring, enabling access to credit for those without traditional financial histories.
Embed financial services into everyday digital journeys—such as e-commerce, ride-hailing, or food delivery apps—meeting customers where they are.
Scale rapidly by integrating with third-party platforms through secure, standardized APIs.

Case Study: Southeast Asia’s Digital Banking Successes

Across the region, digital-first banks and super-apps have demonstrated the impact of this approach. For example, a leading Thai bank, in partnership with technology providers, launched a new digital platform in just 12 weeks, unifying account types and empowering customers with seamless, mobile-first control. In the Philippines, super-apps like GCash and Maya have brought millions of previously unbanked users into the financial system by embedding payments, lending, and savings into daily digital experiences.

Regulatory and Technology Enablers in Malaysia

Malaysia’s regulatory environment has been a catalyst for open banking innovation:

Fintech Regulatory Sandbox and Open API Implementation Group have established clear pathways for innovation and industry standards.
Digital bank licensing frameworks require robust API standards, data security, and governance, ensuring that new entrants can safely and efficiently serve underserved segments.
Continuous feedback mechanisms and sandbox environments allow for rapid testing and iteration of new products, reducing time-to-market and risk.

Best Practices for Designing Accessible, Customer-Centric Digital Products

To truly reach the unbanked and underbanked, financial institutions and their partners must:

Prioritize Customer Journeys: Start with a deep understanding of the needs, behaviors, and pain points of underserved segments. Co-create solutions with real users, iterating based on feedback.
Build Developer-Friendly API Platforms: Enable secure, easy integration for third-party partners, accelerating innovation and expanding reach.
Maintain Regulatory Compliance and Data Security: Embed robust security and privacy controls, ensuring trust and compliance with local regulations.
Empower Customers with Data Transparency: Give users control over their data and clear visibility into how it is used and shared.
Leverage Alternative Data for Credit and Identity: Use telco, e-commerce, and utility data to build more inclusive credit models and streamline onboarding.
Design for Accessibility: Ensure digital products are usable for people with varying literacy levels, languages, and abilities.

The Business and Social Impact

Expanding financial inclusion is not just a social imperative—it is a catalyst for sustainable business growth. Banks and fintechs that embrace open banking and inclusive design unlock vast new markets, drive customer loyalty, and create opportunities for cross-selling both financial and non-financial services. For society, it means greater economic participation, resilience, and upward mobility.

Publicis Sapient: Your Partner in Inclusive Digital Banking

Publicis Sapient is at the forefront of digital business transformation in Malaysia and across Southeast Asia. We help clients modernize legacy systems, design and launch customer-centric digital products, and build agile, cross-functional teams that can iterate and scale solutions rapidly. Our expertise in strategy, technology, and experience design—combined with deep regional insight—enables us to deliver meaningful impact for clients and communities alike.

Ready to accelerate your journey toward inclusive digital banking? Connect with Publicis Sapient’s experts to start building the future of financial services in Malaysia.