BNM TO PRIORITE BUILDING INCLUSIVE, FUTURE-READY FINANCIAL SYSTEM IN 2026

KUALA LUMPUR, March 31 (Bernama) -- Bank Negara Malaysia (BNM) has set several priorities this year, including accelerating the transition to guarantee schemes to help small and medium enterprises (SMEs) access financing more easily and promoting responsible innovation to close gaps in access and protection.

In pursuit of building an inclusive and progressive financial system, the central bank is also expanding financial literacy programmes to empower households, as well as reforms in insurance and takaful to ensure affordability and sustainability.

At the same time, BNM said digitalisation will be advanced securely through open finance, strong governance of artificial intelligence (AI), and trusted digital identity systems.

Last year, the central bank said it directed its efforts toward implementing the remaining strategies outlined in the Financial Sector Blueprint 2022–2026.

“These strategies aim to have a financial system that is accessible, resilient and ready to support the country’s digital transformation and sustainable development agenda.

“This means widening financing options for SMEs and micro entrepreneurs, better financial skills and literacy across society, and enabling responsible innovation that delivers benefits safely and at scale,” BNM said in its Annual Report 2025.

It also said that the year’s initiatives include ongoing benchmark reforms to support a smooth and orderly transition from the Kuala Lumpur Interbank Offered Rate (KLIBOR) to the Malaysia Overnight Rate (MYOR) and the Malaysia Islamic Overnight Rate (MYOR-i).

From 2026, BNM said that it will transition its SME funds from direct lending to a guarantee model.

“This shift reflects the need for scalable financing models, with the financial system playing a critical role in sharing risks more effectively.

“Targeted guarantee schemes can reduce collateral needs and support a higher number of potential SME beneficiaries. It also encourages banks and DFIs to lend to viable but underserved segments and crowd in private financing to priority sectors,” it said, adding that these schemes will support unserved and underserved segments, innovation and transformation, and climate-oriented investments.

“The transition framework is being actively shaped by reaching out to SME groups and associations and the financial community to ensure broad alignment and impact,” it said.

Regarding digital banking, BNM said that by the end of 2025, all five digital banks will have begun operations, marking a significant milestone for inclusion. These banks have collectively served 2.4 million customers and have total deposits of RM4.2 billion.

“About 65 per cent of customers are from unserved and underserved segments, including low-income households, gig workers and youth. Some digital banks also began offering small-value financing.

“Of the RM1 billion financing approved, 34 per cent is for unserved and underserved customers. While modest at this early stage, this performance reflects meaningful progress in addressing unmet financial needs,” it said.

Looking ahead, BNM said it will continue to promote responsible AI use by developing industry guidelines and best practices, facilitating knowledge-sharing, and supporting talent development.

“Public awareness efforts through education and financial literacy programmes will also be strengthened. These measures aim to ensure that AI adoption enhances financial services in ways that deliver real value, such as stronger fraud detection, better customer experience, and improved risk management,” it said.

-- BERNAMA