Malaysia’s Digital Banking Sector Paves Way For 2025 Growth, Positive Crypto Outlook

By Fatin Umairah Abdul Hamid

KUALA LUMPUR, Dec 11 (Bernama) -- The full rollout of all five licensed digital banks in 2025 has reshaped Malaysia’s digital finance landscape, signalling a decisive shift toward a more inclusive and technology-enabled financial ecosystem.

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The digital banks are GX Bank Bhd, Aeon Bank Bhd, Boost Bank Bhd, KAF Digital Bank Bhd, and Ryt Bank.

At the same time, the global cryptocurrency market is projected to maintain its upward trajectory next year. In Malaysia, this outlook is reflected in rising public interest, growing institutional involvement and renewed policy discussions, all of which highlight the nation’s deepening transition into a digital-forward financial era.

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Digital banks lead the change

The arrival of these new five players promises faster adoption of digital banking, heightened competition, greater innovation and a more vibrant digital economy, all while placing fresh responsibilities on regulators and traditional banks alike.

Following GXBank’s debut in 2023 and the entry of Aeon Bank and Boost Bank in 2024, KAF Digital Bank commenced operations on Aug 8, 2025, after receiving approval from Bank Negara Malaysia (BNM).

Ryt Bank, the nation’s first fully artificial intelligence (AI)-powered digital bank, backed by YTL Group and Singapore’s Sea Ltd, started operations on Aug 25, 2025.

Digital banks are capturing the public imagination, setting the stage for a more competitive and inclusive financial ecosystem. From high-interest “safe pockets” for savings, rewards points and other perks, many are offering some of the best rates in the market, ranging from 3.0 per cent to around 4.0 per cent per annum.

AEON Bank and GXBank have also inked partnerships with insurance providers to serve the underserved by the traditional market.

According to industry players, digital banks are now shifting their focus to business accounts, ushering in a new wave of services tailored for micro, small and medium enterprises (MSMEs) as well as larger firms.

These fully digital and branchless banks are also dismantling barriers for rural communities and gig workers alike. At the same time, AI-driven analytics enable financial solutions to be delivered with speed and precision beyond the reach of conventional banks.

Supporting govt initiatives

Beyond personal banking, digital banks are increasingly aligning their services with government initiatives. Most industry players believe this could enable more effective and equitable distribution of subsidies and cash aid, offering an alternative to traditional channels, similar to current e-wallets or MyKad-based systems.

Earlier this year, Prime Minister Datuk Seri Anwar Ibrahim stated that the government is considering drafting a policy that, if implemented, would formally recognise both cryptocurrency and blockchain technology in Malaysia.

“Digital finance is evolving fast,” Anwar said, adding that Malaysia has to move fast in order not to be trapped in an old financial system.

To support this direction, Malaysia has introduced the Digital Asset Innovation Hub to encourage financial innovation within a regulated framework. 

Cryptocurrencies and Stablecoins

In a show of resilience, Malaysia’s banks and financial system were largely unaffected by the recent downturn in the cryptocurrency market. The global cryptocurrency market, meanwhile, is expected to maintain its momentum into next year, with institutional adoption likely to deepen following the strong influx of major players over the past two years.

-- BERNAMA