Malaysia’s telecom firm Axiata Group to bid for digital bank licence

Country’s central bank plans to offer up to five licences by end of 2020 to establish digital banks

Malaysia’s largest telecommunications company plans to bid for a digital banking license. Alamy

Malaysia’s largest telecommunications company plans to bid for a digital banking licence as the country prepares to open up its finance industry to non-bank firms.

Axiata Group is in talks with 11 potential partners about readying a proposal, the firm’s deputy chief executive Mohd Izzaddin Idris said in Kuala Lumpur Friday. They include banks and e-wallet operators, he said, while declining to identify the firms.

Axiata would join non-banks such as Grab Holdings, Ant Financial and Singapore Telecommunications in seeking entry to digital finance in Asia.

Hong Kong is set to see eight virtual lenders start operations this year, while Singapore plans to award up to five licences to non-banks by June. Thailand is also laying the foundations for a similar initiative.

Malaysia’s central bank issued a draft policy in December for establishing digital banks. It plans to offer up to five licences by the end of 2020, after finalising the policy in the first half of the year.

Axiata is in discussions with the central bank and expects its digital banking operation to start in the second half of next year, providing it gets approval, Mr Izzadin said. Axiata is the largest Malaysian telecoms firm by revenue.