Kuala Lumpur: Malaysian financial institutions must be agile, speedy, and adaptable when embracing the challenges of digitising financial products for the changing consumer, say experts at a panel session sponsored by Al Rajhi Bank Malaysia during the Global Islamic Finance Forum 2022.

All four panellists, who are experts in digital banking and innovation, stressed the importance for institutions to be open to new types of partnerships in order to design more accessible products.

Bertuğ Öngiden, Revolut’s Global Strategy and Ops Lead, said it was important for financial institutions to recognise their strengths in-house, while harnessing the API capabilities of potential long-term or short-term partners.

He gave the example of Revolut.  “The architecture at Revolut is quite modular. We build the core infrastructure in-house, and build on microservices,” he said. Microservices is a style of software architecture that divides an application’s different functions into smaller components.

Ongjden said modular approaches gives financial players the chance to expand to other customer segments or different markets.

APIs or application programming interfaces are the hooks and software to build applications that connect to other firms' technology. Banks with APIs enable fintech firms to build apps that utilise their infrastructure, like checking account balances.

Panellists note that financial institutions may struggle with legacy systems, with monolithic designs and sometimes written in dated programming languages that could be inflexible or pose security concerns.

But this was changing, as Dan Jones, Partner of Oliver Wyman said that the market was experiencing API transformation from multiple vendors.  There has been much upgrading of programming, software, and more API-driven architecture.

“The question is how financial institutions can get value from APIs and monetise, and these commercial opportunities are still at an early stage,” he said.

Jones added that larger institutions are working with startups and fintechs to innovate and experiment with data and be nimble with customer demand.

He said the trend that the space was experiencing today, particularly in the younger generation, was that they were more comfortable in using financial services products through an app or website.

“And often these sites are not branded as a financial service.  What we are seeing is more financial institutions embedding financial offerings into a site, and that’s typically in e-commerce,” he added. 

Jones noted this trend was taking place in gaming, lifestyle, or health sectors.

Farhan Ahmad, CEO, Payment Network Malaysia reminded those keen on getting onto this digitalisation bandwagon that they must be aware of the investment cycles. “Transformation needs longer investments, investment has to have longer runway and different outcomes,” he said.

He also said as customers diversify their shopping and spending habits, this also applies to the way they expect to interact with their banking and payment services.

But it was emphasised that there were many advantages with more non-bank players entering the financial scene through digital banking licenses. Öngiden said one was that these players do not have legacy issues.

“They are built as a greenfield bank and have niche offerings. They have more focus and tend to offer the customer the right product at the right time,” he said. These non-banks are in a space previously untapped or developed, he also said.

Öngiden added these players often leverage on data as much as they can, in terms of targeting customer segments and risk assessments.

Digitalisation offers a new way of thinking, changing the shape of how financial services are delivered, and this means more collaborative ventures, said Ikram Khaliq, Head of Digital Bank, Al Rajhi Bank Malaysia.

He added capital requirement is fundamental for lending products and their business models would depend on the access of funds they have.

“What is key is that these new innovators do not have to be a leader in that (lending) space but can bring models or capital from different partners.  This changes the shape of what you bring to market,” said Ikram who is also the moderator for this session titled, How to build digital Financial Services in easy steps.



The Association of Islamic Banking and Financial Institutions Malaysia (AIBIM) was established in 1995. Currently, AIBIM has 28 member banks and the association:

  1. Promotes sound Islamic banking system and practices in Malaysia.
  2. Represents the interest of members locally and abroad.
  3. Provides advice and assistance to members pertinent to the development of Islamic banking and finance at a local, regional, and global level.
  4. Coordinates human capital development initiatives.
  5. Promotes public awareness on Islamic Finance.

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