What is the Job Demand, Career Prospects & Salary in Malaysia for Financial Technology (Fintech) Course
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Financial Technology or Fintech is an all-encompassing term used to refer to technology in the financial services sector. Fintech used to refer to the back-end technology used to run traditional financial services organizations, but has morphed into a term primarily used to describe disruptive financial technologies.
Fintech investment ballooned from $1.89 billion in 2010, to $27 billion in 2017. The increase in fintech spending is expected to continue, with the Asia/Pacific and African markets driving a significant share of market growth. According to the Hays 2018 Salary Report on Fintech Jobs in Malaysia, the Malaysian finance technology (Fintech) market grew steadily over 2017 driven by new technology innovations and regulatory change. The central bank, Bank Negara Malaysia, is working to raise the profile of FinTech amongst financial firms and insurers to improve the quality and efficiency of the country’s financial services sector. This push has created more job opportunities for candidates in the emerging technologies space including mobile and the web.
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Financial Technology (Fintech) – The Job Demand, Career Prospects & Salary in Malaysia
The fintech umbrella includes insurance technology (insurtech), regulatory technology (regtech), financial data APIs, payments, banking, and mobile banking, among other types of technology. Each category represents a distinct category of finance-specific technology.
The explosion of the internet and the mobile internet has catalyzed the rapid development of financial technology. Even lumbering, highly regulated and highly cautious industries (such as insurance) have begun to embrace the innovative opportunities for enhanced effectiveness offered by fintech solutions.
Financial services institutions have warily kept fintech companies at arm’s length, seeing them as industry disruptors and potential competitors. Wisdom and self interest have triumphed over caution, it seems, as financial giants have started to invest in and partner with fintech companies.
This newfound acceptance and promotion of fintech innovation, proven by the large amount of investment in the fintech industry, will accelerate the development and implementation of fintech throughout the financial services sector.
Data from Bank Negara Malaysia shows that mobile banking transaction value has grown seven times in the past five years whereas e-money’s transaction value has grown more than double in the same period. This indicates that Malaysian are increasingly becoming more comfortable with using mobile financial services.
Fintech aims to make institutions more efficient and effective, provide consumers and businesses with more choices, increase transparency and cut down on the amount of time wasted during financial transactions.
Where to Study the Fintech Degree Course in Malaysia?
If you are looking for private Universities where you can study fintech courses at undergraduate level, Asia Pacific University (APU) was the first University to offer fintech courses to undergraduate students in Malaysia. For more details on the course, please WhatsApp 01111408838.
Fintech Growth in Malaysia
Excerpts below are taken from Fintech Malaysia Report 2018 – The State of Play for Fintech Malaysia
by Vincent Fong July 18, 2018
A combination of healthy economic fundamentals alongside with high penetration for both internet smartphones, and a swelling number in fintech startups is the perfect recipe for Malaysia’s fintech sector to grow.
Malaysia Fintech Statistics
- Malaysia’s Population – 31 Million
- Urban Population – 76%
- Internet Penetration – 85.7%
- Banked Population – 81%
- Has Savings in Bank Accounts – 41%
- Credit Card Ownership – 21%
- Debit Card Ownership – 74%
- Smart Phone Penetration – 75.9%
- Mobile Banking Population – 40%
- Online Banking Population – 85.1%
- Made Purchase via App – 14%
- Made Online Purchase Using Smartphone – 28.4%
Online Banking Dominates Payments, But Mobile is the Micropayments is Still Top in Malaysia
Based on the statistics from Bank Negara Malaysia, it is clear that online banking is still the dominant channel for Malaysians to perform transaction, with a 85.1% online banking penetration the reasons as to why is clear as day.
How despite the significantly smaller value in transaction, both mobile banking and e-money shows a considerably larger volume in transaction.
The data tells a narrative that mobile payments whether through digital wallets or mobile banking is the preferred channel to perform micropayments.
Breakdown of Fintech Players in Malaysia
Both payments and wallets, much like last year’s report, remains the largest representation of the Fintech Malaysia scene. Payments represents 19% of the market whereas wallet represents 17% of the market, compared to last year’s 18% and 12% respectively.
It is likely that the digital wallet growth is caused by a combination of players being cognizant of the growing demand for mobile payments and others jumping into the bandwagon. Nonetheless the space is becoming increasingly crowded, it’s difficult for a month to pass in Malaysia without an announcement of a new wallet player in town.
A Surge in Cryptocurrency Exchanges
While the cryptocurrency hype has simmered down considerably since it’s November – December 2017 highs, the interest in setting up cryptocurrency exchanges has not.
A year ago there were only a handful of exchanges in Malaysia but in 2018 we’ve observed many players gearing up to enter this space.
However it is worth noting that, although much of the list of players are extracted from Bank Negara’s list of reporting exchanges, there were a few questionable companies within that list and some with known affiliation to scammers (some of which we have removed from the list to avoid giving them more publicity).
Which is why consumers would be wise to take heed of Bank Negara Malaysia’s statement that while these cryptocurrency exchanges have reporting obligations, as non-regulated entities consumers will not be afforded should there be any disputes.
What are the Areas in Fintech and the Job Demand Globally?
Insurance technology (insurtech) saw over $2 billion worth of investment in 2017, a solid endorsement of the value provided by solutions in this fintech subcategory. Insurtech has been slowly embraced by the insurance industry, a notoriously un-innovative industry.
The strict regulations that govern the insurance industry have held back the development and implementation of insurance-specific applications. Now, however, insurance agencies have embraced the potential represented by insurance-specific solutions.
The global insurance industry gross written premium (GWP), which is essentially the size of the industry, was $4.8 trillion in 2017. There is massive potential in the industry, and the influx of insurtech investment will continue as fintech companies look to capture some of that huge market.
Regulatory technology (regtech) is technology that helps financial institutions meet financial compliance regulations. Regtech has seen an immense upsurge in popularity within the past few years, which is due in part to the rise of disruptive fintech products.
Regulators have scrambled to shackle these new technologies to protective regulation, taking it upon themselves to codify strict data regulations in order to curtail data misuse by banks.
Regtech spending is expected to reach $76 billion by 2022. The catalyst for this explosion in spending has been the increase in financial regulations, which has prompted banks and other financial institutions to ensure regulatory compliance to avoid massive fines.
Since the global financial crisis in 2008, banks have been hit with $243 billion in fines. Banks are preemptively attempting to stave off these pernicious fines by investing in regtech, which eliminates the need for massive compliance teams and drives compliance.
Financial data APIs are changing the way the financial services industry looks at banking and have bolstered the concept of open banking as a viable concept. Open banking refers to banks opening up their vast amounts of client data to help financial technology startups develop applications designed to help banking clients.
Data anonymization is the key to the viability of open banking as a concept, as it means that data is cleansed of any personal information prior to being handed over. This ensures the protection of user privacy and allows companies to use these massive datasets to develop innovative solutions within the financial services space to the benefit of the entire industry. Regulators lead the drive for open banking, creating legislation designed to promote competition and consumer choice by catalyzing innovation in the sector.
Financial data APIs are multifaceted tools that can be leveraged to provide value in a variety of ways, including connecting businesses to stock information.
Payments is such a massive subcategory within the fintech space it deserves its own article (which it will get, coming soon). The largest subcategory within the fintech space, payments has improved the ease with which people can do business.
Payments solutions aim to cut down on transaction times between financial institutions, specifically within the international money transfer market, which has been the bane of many entrepreneurs’ existence. Small businesses, by using a payment gateway solutions such as Square, can now accept credit and debit cards, opening up a whole new range of potential customers who deign to use cash.
Mobile payments in particular has become an increasingly important fintech category that is opening the door to financial inclusion for billions of people.
Banking software has been around for quite some time but has seen rapid development in the past few years, specifically in the mobile banking sector.
Mobile banking has driven financial inclusion for the 2 billion unbanked or underbanked, enabling these users to skip the step of banking with a brick-and-mortar institution. Mobile banking allows consumers to bank directly on their mobile devices.
Lending technology has also developed rapidly within the fintech framework, offering businesses and consumers opportunities to borrow like never before.
Lending and loan software improvements have also impacted traditional lending institutions by giving them tools to automate processes, cutting down on the time spent on unnecessarily redundant tasks. From loan origination to loan servicing, solutions in the lending category run the gamut and provide a breadth of functionality specifically for the lending industry.
A prime example is peer-to-peer lending platforms. While these platforms often offer personal loans, they also offer business loans. The goal of peer-to-peer lending platforms is to lower the qualification barrier to getting loans. Businesses that would otherwise not qualify for a loan from a traditional financial institution have the opportunity to qualify for these.
While blockchain is not unique to the financial services industry, it was in the industry in which it was first utilized.
The premise of blockchain (here is a more in-depth blockchain explained resource) is that all data is housed in a distributed ledger, which ensures the veracity of the data housed there by cross-referencing it against all the other ledgers in existence.
There are a variety of use cases for blockchain technology within the financial services industry. One estimate puts the potential time savings in just the banking industry at 5.4 million hours per year by 2022.
While the regulatory powers that be are still working on instituting solid regulations, it looks as though blockchain technology in some form, be it public or private, is here to stay in the financial services industry. Our blockchain platforms category has dozens of products upon which fintech projects can be built.
One blockchain application within the financial services sector is that of smart contracts. A smart contract utilizing blockchain technology validates, monitors, and enforces the terms of the contract automatically. This eliminates the need for legacy technologies in the financial contracts world and streamlines the entire contract process.
The Future of Fintech in Malaysia and Globally
The next few years look to be bright for the fintech industry. Advances in artificial intelligence and data handling and analytics will drive even more innovation in the sector.
Open banking practices and an increase in the number of financial data APIs will drive even more fintech application development. Blockchain projects have the potential to catalyze rapid evolution in the banking industry and beyond.
What are the Career Options for Fintech?
- FinTech Specialist
- Banking Specialist
- Payment System Specialist
- Data Analyst
- Financial Analyst
- Product Developer
- Compliance Expert
- FinTech Quantitative Developer
- Strategy Analyst
- Business Development Associate