THE Association of Banks in Malaysia (ABM) has played a crucial role in shaping the nation’s banking industry.
Since its establishment in 1973, ABM has consistently worked to support business growth especially small and midsize enterprises (SMEs), promoting social inclusion, and amplifying community impact.
Over the years, it has evolved from performing primarily administrative roles to becoming a strategic partner focused on addressing the dynamic needs of the financial industry.
Bringing the theme of ‘Powering Success: 50 Years of Commitment and Beyond’ in its 50th anniversary, ABM said that the theme reflects its ongoing commitment to championing beyond the banking industry, touching lives by empowering them towards progress.
Sarawak Tribune (ST) had the opportunity to meet with ABM executive director Dr Amina Josetta Kayani to share the association’s ongoing efforts in promoting financial inclusivity and ABM’s participation in the Karnival Celik Kewangan (KCK) happening from Nov 15 to 17 at Vivacity Megamall.
Sarawak Tribune: What was the primary purpose behind ABM’s establishment in 1973, and how has it evolved over the years?
Amina: ABM is an association who work very closely with the member banks. Currently, we have 27 member banks and 13 of them are in our council. We do not have any regulatory powers or any regulatory mandate but what we do have is the power to bring the banks together to grow the industry, to propel the industry in times of change. Our core business is strategic communications.
When we first started, the roles of ABM were more administrative in nature. Now, we have a lot more assistance in terms of collaborative tools and technology that enables us to do things faster. Besides working with technology to streamline communications to make it better and more efficient, we are also working very strongly towards zooming out to what the industry really needs.
In that sense, ABM has stepped up, especially this year, in terms of our strategic presence and strategic value that we bring to the member banks and the whole ecosystem of the financial industry. Because that is what Malaysia really needs. When we have that bigger mindset to see what the industry is lacking, certain areas need different kinds of tools and solutions because every solution doesn’t fit every single market.
This realisation is definitely our first step. Awareness to build the spirit of figuring out how to customise solutions to better suit the market. It is mainly one of our core pillars of priorities, which is financial inclusivity to make sure that, as far as possible, we enable access to financial services to all Malaysians. Regardless of geography, background, where you are, age group, gender, and a lot more.
ST: In your opinion, how far is Sarawak specifically, in this path towards financial inclusivity?
A: We are getting better at the intensity of focus in Sarawak and Sabah. As these two states are so geographically dispersed, the tools and the approach to address the needs of the market are all different. For example, what we see and do here in terms of financial services in Kuching, or Miri, or even Sibu for that matter, is very different compared to if you go a little bit deep into Mukah or Limbang or anywhere else because they would not have access to any banks.
So, how do we make sure that they do that? One good thing, I have been saying this for many years now, the Sarawak government is definitely on the right track. Your infrastructure is just superb. You are set to actually build the infrastructure ready to address the issues of accessibility. Having said that, what is required right now is literacy.
Wherever you go, if literacy is not there and even if we have services, products, and perfect infrastructure, we still have a very big gap. The risk is there. So, what we really need to focus on and what ABM is really doing is prioritising collaboration with different partners like, for example, Financial Industry Collective Outreach (FinCo). What we do together with FinC is we build financial literacy and also literacy in general.
Whatever we do, we have to be able to understand the language. Then we can actually take it up into a technical skill, whether it’s financial or digital. All these literacy skills build a very solid, savvy state. That is why our focus is to build on Sarawak. The tools will be similar to Sabah. Perhaps, Sabah infrastructure-wise, they need to do a little bit more. Additionally, we need to focus on influencing policy to draw the attention of key stakeholders who can collaborate in building this ecosystem together. With infrastructure in place, along with banks, products, and services, the next step is empowering the people. They must develop resilience and learn how to effectively use these resources. It’s crucial that they are not left vulnerable; they need the knowledge to protect themselves.
ST: Is the lack of literacy awareness the cause of many people becoming victims of scam cases?
Yes, and just last year alone, the scam cases reported are over a million cases. Scammers are smart. Even though we are always trying to figure out what they’re doing, they will always come up with different tactics and methods of scamming. For example, they use this method to scam and then when we figure it out, we teach the people to protect themselves against A, B, and C. However, the scammers figure out how to do D, E, and F, and then it continues.
So how do we actually beat them at their game? It is if we are able to zoom out and empower people to be smarter, so that they can actually assess what are the key factors or key indicators that this might be a scam. Together with that, ABM is pushing very hard to work with the other stakeholders in the ecosystem. There are a lot of different committees in place, which ABM is actively a participant of.
For example, we have the Industry Task Force (ITF) for Fighting Scams. In that task force, there is also participating with the National Task Force (NTF), Royal Malaysian Police (RMP), telcos, Malaysian Communications And Multimedia Commission (MCMC), and the different stakeholders. This is because it is a whole-of-nation approach, meaning that it takes everybody to have all hands on deck to address it.
We can’t just simply say this is the responsibility of the financial industry only, or this is only the responsibility of the Telcos. It is a collective and combined effort. Only when we work together can we synergise to manage this crisis.
ST: How does ABM’s collaboration with the Central Bank of Malaysia (BNM) help ensure the stability and soundness of Malaysia’s banking sector?
A: I believe in the spirit of recognising everybody has a role to play. Therefore, our way of collaborating with the regulators is quite much like we play tag team. They are the ones with the regulatory powers but they are also very strategic in approach right now. It is no longer playing that very strong regulatory mandate to say, I say, you do.
Times have changed and the whole world is seeing change happening so fast. It is unprecedented. There are so many external environmental factors that are impacting people. So, how does a regulator work with this? What they do is that they see in certain instances they need to actually mandate, they will come up with a certain policy. They come up with exposure drafts, they go for public consultation and all that. After that, they firm it up. All that process, we are very actively participating in.
We realise that it is the power of minds together to figure out what the country needs. It is a continuous process and iterative. Moreover, BNM is very good in terms of approaching the matter by way of getting industry to lead certain initiatives which require that. This is because the industry has a clear view of the problem sets on the ground.
For example, open finance. This is something that a lot of countries have already introduced so how are we doing it? We are collaborating very closely with BNM and Paynet. We collaborate together, collectively try and figure out how to fit the puzzle together to see what will work for our ecosystem. We can’t exactly take other countries’ solutions and plug them into Malaysia. There will be a lot of parts which will stick out like a sore thumb. So how do we do it? We have to actually put our heads together and come up with use cases, try it out, get proof of concept, scale it up. BNM, Paynet, and the industry are very strong. And we are there, leading the whole industry together.
ST: Regarding the Karnival Celik Kewangan (KCK) happening now, is the event specifically for Sarawak or is it a national level event?
A: KCK has been to Terengganu. This year is the first time we organise it in Sarawak and in terms of its scale, the event this time around is definitely huge. I feel that it’s a very positive spirit and indicator of the people in the positions of making a change, recognising that that is required. You see, there are certain areas of the country which require additional priority, and that is a definite way to look at the whole problem. We believe that if we go to other areas, the ripple effect might not be as much. Therefore, we go to the states which require the most help.
There is also another very strong movement called the Financial Education Network (FEM) that is also represented by the banks and a few other different stakeholders who collectively move to empower the society better with financial literacy, ability, resilience and all that. Besides that, there is a very big priority of the whole financial and ABM for the SMEs and MSMEs. Now, our member banks have been very active at figuring out innovative solutions, products, to penetrate markets where they need this kind of new solutions. For example, taking a loan. You see, generally, a lot of businesses are expected to have a credit rating. You need to have a Central Credit Reference Information System (CCRIS), Credit Tip-Off Service (CTOS), and some kind of track record in order to get a loan.
How do the banks manage around it? So, there are different digital tools and offerings offered by the current traditional banks and on top of our two new digital bank members namely GX Bank and Boost Bank. Their reason for being is they were given the licence to really specifically address this issue of financial inclusivity and that includes addressing having tools and products available to the people who do not have this credit rating. The larger banks also have that but they have different digital offerings.
Other than that, there is also micro-financing. It is more of catering solutions to the customers, especially from these micro-SMEs.
ST: How do you feel that digitisation has impacted ABM’s processes towards serving not just consumers but also SMEs?
A: It has affected us in a very nice way in terms of getting more efficient and working with a lot more collaborative tools. However, we haven’t explored 100 percent of it. There are still a lot of tools which are already employed by the younger organisation with younger people as they are faster.
That is why, we have to give credit to my team. We have 20 internally in ABM and we have five young interns. The world has changed a lot and it is continuously changing, hence, we see the need to bring in new, fresh ideas, fresh perspectives. Since change is always constant. We realise that we need to actually lower the average age and to have more of an open mindset. So we brought in interns to work together in parallel with the current team. The interns are the ones who are helping us push for this digitalisation because these people are digital natives. So that is one of the quick wins that we got from the interns in the office.
ST: What are your expectations on the outcome from ABM’s participation in the KCK here in Sarawak? Do you have any targets that you hope to achieve?
A: ABM has always been small and has only recently stepped up this engagement and outreach team internally. Otherwise, we have not really been there as we are short-handed. So humbly speaking, the first realisation and expectations that we have from this participation is to open our eyes further in the awareness and the validation of a need to do more.
Sarawak and Sabah are two different markets. I know that because I have worked and taught in these two states before. I would say that realisation is required because when people work with a heart and they know what is required, they will do it better. Next, is also looking at what other people are doing. At the carnival, there are going to be a lot of other people with similar targets and goals and perhaps some may be different. However, the mechanisms of how people are addressing the problem might be a little bit diversified from one to another. So it is very important for us to know what others are doing and to let people know what we are there for.
Even the very simple information about who we are, what ABM actually does, what kind of value we bring to the people, nobody really knows exactly what ABM is. Simply because we have been so busy keeping up with all this administrative work. So it is not easy. So those are the simple key takeaways along with the ultimate goal of getting better, to firm up better targets and goals to work with the regulators, and also to work with the banks. Other than that, we also aim to have more encouragement to the banks to step up even further with better products and services, and to cater to the needs of unique markets around the country.
