Mobile Payment System in Malaysia: Its Potential & Consumer Adoption Strategies

Mobile Payment System

Vast changing pace of technologies has drastically alter how business operate and how service are being provided. Adoption of technologies has made transaction convenient to consumer. Adapting to the continuous innovation of technologies has create competitive advantages to organization which adopts it.

There is various types of payment system in Malaysia, one of the current and newly introduced system is Mobile Payment system. Mobile Payment are simply defined as payment which is made over mobile devices. Malaysia first introduced mobile payment was in 2001 with the name "TeleMoney", was being managed by System@Work company.

Collaborated with Hong Leong Bank facilitating on settlement of payment and handling payment service in Malaysia. In order to use this service, the only requirement needed was GSM (Global System for Mobile Communication) and an active account with TeleMoney which consist personal identification verification. Any user which has GSM mobile phone and credit card or debit card are eligible to use this form of service.

Besides, System@Work are working with few companies such as Celcom to expand the field of mobile payment which will replace conventional method of settling payment.

In 2009, Maxis has launched NFC (Near Field Communication) in Malaysia, with this new technology enables consumer to make purchases convenient by using mobile phones. FastTap service is newly introduced using NFC embedded into mobile phones for instances Nokia.

Its Potential in Malaysian Market

BNM (Bank Negara Malaysia) foresee the potential of venturing into mobile payment as the new industry, survey shows more than 80% of Malaysian population is subscribed to phone services. Technologies embedded into mobile phones has brought it into the next level apart from the conventional way of only performing voice communications now mobile phones can take picture as well as surfing the Internet. People tend to adopt to this feature easily and it creates an opportunity of business in mobile payment.

On the other hand, another reason of potential is survey conducted by BNM has shown 97% of sample being surveyed has a bank account which bring means to the availability of encouraging bank user to adopt mobile payment as its convenient and less costly to perform.

High percentage of mobile phone subscriber and bank account user provide ideal platform of starting or introducing mobile payment to consumer as their personal payment system.

Consumer Adoption Strategies

Mobile payment has yet to achieve wide acceptance of its service which may due to several factor. BNM stated only 1.8% of the whole Malaysia population of 25 million are currently utilising this service. In order to encourage user to adopt mobile payment there is several ways which may need to prioritize.

The need to collaborate with industry player in area such as common payment messaging format, authentification and securities. Through ensuring having common payment format it enables consumer and merchant to perform transaction easily and less hassle. This involves more cost effective and convenient which draws larger target group to use this service. Consumer will want service and login in which requires less rigidity but at the same time they are ensured their personal information are well protected.

On the contrary, organization must look into the needs of consumer payment preference. Where consumer expectation of service being received plays huge impact on how consumer preceived the system to be efficiency in providing what it has claimed to give or merely an alternative of types of payment.

Therefore its important to educate consumer of mobile payment and features in in it which consumer can fully utilise to the full extend. It involves creating awareness of the existance in market. On the other hand, its also crucial to ensure that consumer felt save when using mobile payment system by increasing their confident level towards performing transaction through mobile phones.