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Advances in technology, government programs, and shifting consumer preferences have all contributed to Malaysia’s notable shift towards cashless transactions in recent years. Malaysians’ daily transactions have changed as a result of the widespread use of cashless payment systems such contactless cards, e-wallets, online bank transfers, and debit cards in both urban and rural areas. This evolution is a fundamental shift and it benefits buyers, sellers, and society as a whole in many ways.a

For consumers, the convenience of cashless payments is unparalleled. They can now conduct smooth transactions at physical shops including retail stores, eateries, and even street vendors with just a smartphone, wristband, or card. Because digital payments lower the danger of theft and loss associated with real cash, they also offer improved security in addition to convenience of use. Additionally, many banks and e-wallet providers encourage customers to use cashless ways by providing attractive cashback benefits, discounts, promotions, and loyalty points.

Businesses and sellers alike are benefiting from this digital revolution. Since customers no longer need to worry about carrying enough cash, they are encouraged to spend more. According to a data report by Bank Negara Malaysia, the Transaction Value Per Capita for nearly all e-payment platforms increased significantly from RM668 million in 2018 to RM928 million in 2022. Cashless payments also simplify operations by reducing the time spent handling cash, calculating change, and balancing accounts. Additionally, they lower the risk of theft and loss, especially when dealing with large sums of money.

Adopting cashless solutions gives small enterprises and micro-entrepreneurs access to a larger consumer base, which includes tech-savvy Gen Z and millennial consumers who prefer online shopping to cash transactions. Additionally, digital payment platforms offer useful data insights that let companies examine customer behaviour and modify their products accordingly. Increased sales and better customer satisfaction are possible outcomes of this data-driven strategy. At the same time, cashless payments provide greater flexibility in term of data transaction when transactions are recorded and can be easily traced.

Among the most enthusiastic consumers of cashless payments are students, who are frequently early adopters of technology. E-wallets and mobile banking apps provide a practical way for college students with limited funds to keep track of spending, divide bills, and make purchases online. By eliminating the need for lengthy lines at bank counters, cashless solutions also make it easier to pay for tuition and other educational costs. Additionally, incorporating cashless purchases into campus life, for example, for public transit, fines, or cafeteria meals could simplifies daily routines and promotes a more productive learning environment.

The widespread use of cashless payments has societal implications in addition to personal advantages. The reduction in cash circulation lowers the costs associated with printing, transporting, and securing physical currency, contributing to economic efficiency. On a broader scale, the move to a cashless society is consistent with Malaysia’s ambitions to develop into a high-income, technologically advanced country.