Cloud, no code / low code, and more – Exciting trends await financial services in Malaysia in 2023

• Business teams will be able to quickly develop and roll out new digital banking products and services using a low code/no code methodology
• ESG will become more prevalent in APAC, encouraging traditional banks to provide financial services and solutions that are more inclusive and customizable

Malaysia’s financial services industry has seen many significant trends in recent years. One key trend is the growing adoption of digital technologies, which are changing how financial services are provided and used in the country. This transformation includes the adoption of blockchain and other distributed ledger technology for various financial services, as well as the use of mobile banking and payment apps.

Expect to see many of these trends accelerate in 2023. The growth of embedded finance is accelerating, and legacy players are under growing pressure from big tech’s interest in banking. Financial players must adapt to consumers’ rising expectations for digital experiences, even if the digital revolution will provide compliance and regulatory issues.

The financial industry is experiencing exciting times despite the unsettling macroeconomic prediction. Let’s examine the state of finance in 2023.

Leading SaaS cloud banking platform Mambu has released its annual Partner Predictions report, which identifies the most significant financial trends anticipated to impact the market in 2023 as companies fight to survive and prosper in a tumultuous macroeconomic environment.

The report features insightful commentary from industry leaders from the fintech and financial services sectors, including executives from AWS, Backbase, Deloitte, Google Cloud, and many more. Participants shared their insights on the major issues likely to impact the financial services sector in the coming year.

According to Conor McNamara, Managing Director for AWS in ASEAN, more businesses will likely use cloud-based data and analytics in 2023 to gain market insights and create seamless, customized consumer experiences.

Malaysia has seen the growth of Islamic finance, which is based on principles of fairness and social responsibility and has become an increasingly popular alternative to traditional financial products and services in the country.

“In Malaysia, we’re helping Bank Islam build and deploy new services for customers that comply with Shariah/Islamic financial requirements. In Vietnam, we’re working with TNEX to build application functions that promote healthy living, improve personal finance management, and drive financial inclusion,” McNamara continued.

Trends to have an impact on APAC’s financial services industry

Many of the forecasts stated in the report from last year have continued into 2023, but Mambu anticipates more of the same, only faster, bigger, and more significant. Banks and fintechs are beginning to integrate their services into merchant and super-app platforms in the Malaysian digital banking sector, resulting in the development an ecosystem of services that coexist harmoniously.

Other trends and concerns that are anticipated to have a significant impact on the financial services sector in Asia-Pacific are:

• Low code/no code: This approach will enable business teams to swiftly prototype and deploy new digital banking products and services without requiring complex development procedures and specialized coding skill sets. This move will result in a shorter time to market for those products and services.
• Big tech in banking: Many big tech businesses have already transitioned to banking in Asia. Organizations like Grab, AEON and the SEA Group are now part of conglomerates that possess licences for digital banking. This move by big tech will encourage traditional banks to accelerate their digital transformation and provide more competitive banking services since customers now have higher expectations for their digital experiences.
• ESG and ethical impact finance: In APAC, there will be a shift toward ESG, which will encourage traditional banks to offer financial products and services that are more inclusive and customizable while also keeping sustainability in mind for the benefit of their customers. In Asia, potential customers from religions other than Islam who are passionate about ethical finance will show increasing interest in Islamic banks.
• Future of payments: Since the start of the pandemic, APAC has seen a significant increase in online, mobile, or digital payments. Asia has also seen one of the largest uptakes of e-wallets globally. In the coming year, banks will shift their attention from the payments theme to other areas, emphasizing the developing of their interfaces and improving them to foster brand loyalty.

Customers will ultimately decide whether players succeed and stay in the market, and they will favor those who innovate and move quickly. One of the most critical strategies financial services will need to adopt to survive and prosper is technological adoption.

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