Study: 63% of Malaysians utilise mobile wallets for transactions, but threats persist

Malaysian consumers are leading the charge in embracing alternative payment methods and cutting-edge technologies, according to a report by global financial technology platform for business Adyen.  The report is based on a survey of over 38,000 shoppers and 13,000 merchants across 26 markets. 

According to the report, 63% of Malaysians utilise mobile wallets for transactions, boasting the highest adoption rate globally. In addition, 41% of Malaysians now rely on mobile-enabled solutions like tap-to-pay, with 36% of consumers admitted that they no longer carry a physical wallet. 

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As such, technology such as kiosks, and one-click checkouts are becoming increasingly popular among consumers, driving demand for more efficient in-store experiences, said the report. 

As a result, businesses have pursued to diversify their platforms, with 73% of retailers embracing social commerce and personalisation to foster stronger customer loyalty.

This is especially since 45% of consumers have expressed loyalty to retailers who allow purchasing directly from social media platforms. This emphasises the importance of seamless shopping experiences across channels, added the report. 

“As the retail landscape rapidly evolves, the integration of technology and personalisation is becoming increasingly apparent. Our recent findings reveal a significant shift towards digital payments and social commerce with Malaysian consumers leading the global trend in mobile wallet usage," said Soon Yean Lee, country manager, Malaysia, Adyen.

"To retain customer loyalty and maintain competitiveness, businesses must be nimble in catering to these changing consumption preferences.”

The report further revealed that Adyen’s research further showed that millennials were most likely to shop on social media platforms than any other age group, with 80% saying they’d done so in the last 12 months.

Meanwhile, gen Z consumers clocked the greatest growth. Of all of the Gen Z consumers that have shopped on social media, 17% of them are first-time buyers, added the report. 

In addition, businesses have enriched shopping experiences to amplify consumer engagement and broaden their reach. This includes investing in financial technology (21%) and rewarding customer loyalty as 51% of consumers are willing to share data in exchange for retailer discounts. 

64% of consumers are also inclined to download a retailer's app to access superior loyalty incentives. This exceeds the global average of 58%. 

Pitfalls to watch out for

The advent of mobile wallets and social commerce also presents a natural rise in fraud, according to the report.  In 2023, 95% of businesses in Malaysia experienced attempts of cyber-attacks or data breaches, placing the country second globally after Canada. 65% of businesses acknowledge that fraudulent transactions and chargebacks have significantly impacted their operations and profitability, surpassing the global average stat of 51%.  

To combat fraud and reduce chargebacks, 69% of Malaysian businesses are considering collaborating with their payment providers to chargeback liability guarantees.  

“Online shopping is all about trust and consistency. When creating a safe space strengthened by robust customer authentication and chargeback management capabilities, retailers allow consumers to shop with peace of mind. Businesses themselves can also rest assured that the risk of chargebacks is also minimised, leading to a boost in revenue and more efficient operations,” said Lee. 

In April this year, it was found that 71% of companies fall into low categories of cybersecurity readiness. This is according to IT and security giant Cisco's 2024 Cybersecurity Index which surveyed 8,136 business leaders across 30 global markets. 

The report found that 54% of organisations have experienced a cybersecurity incident in the past year and 73% believe they are likely to face one in the next year or two. While malware (76%) and phishing (54%) continue to remain the top types of attacks experienced, 37% of companies were impacted by credential stuffing in the past year.

Despite the lack of readiness, 80% of companies feel moderately to very confident in their ability to stay resilient against cyber threats. 

Join us on 12 June 2024 for an exciting experience as Content360 makes its debut in Malaysia! Brace yourself to join the crème de la crème of the content marketing industry hailing from across the region. Immerse yourself in a dynamic atmosphere, and uncover the latest trends with thought leaders and solution providers from the realm of content.

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