Axiata To Launch Digital Bank By Year-end

KUALA LUMPUR, May 26 (Bernama) -- Axiata Group Bhd plans to launch its digital bank by end-2023 and targets to make it profitable over the next three to four years, said its chief executive officer and managing director, Vivek Sood.

Vivek said the initial capital commitment for the digital bank would be around RM100  million, and it would offer large product offerings, including deposits for current account and saving account (CASA) account holders as well as insurance products and other financial products that would be gradually launched starting end-2023.

“Why we are optimistic about the outcome of the digital bank comes from the fact that there are many things we have already done which need to be translated to the bank. For example, we have done around one and a half billion in loans to micro, small, and medium enterprises (MSMEs) within our existing business within Boost Credit.

“We also have a large number of a half million active customers on a monthly basis which could potentially be the customers of the digital bank from day one. We are preparing our plans and would require the central bank’s necessary approvals before we can launch it,” he told a virtual media conference after the group’s annual general meeting today.

Axiata’s unit Boost Holdings Sdn Bhd, in a consortium with RHB Bank Bhd, has secured one of the five digital bank licences issued by Bank Negara Malaysia.

The other recipients are a consortium led by YTL Digital Capital Sdn Bhd and Sea Ltd; a consortium led by GXS Bank Pte Ltd and Kuok Brothers Sdn Bhd; a consortium led by KAF Investment Bank Sdn Bhd; and a consortium of MoneyLion Inc, Aeon Financial Service Co Ltd and Aeon Credit Service (M) Bhd.

Vivek said the group did not foresee any hurdles for the digital bank as of now, but the whole process of launching the bank requires a thorough review and approval needed from Bank Negara Malaysia (BNM).

He said Axiata is working closely with BNM to clear the approval hurdles and have placed robust cybersecurity measures to ensure privacy and prevent data breaches.

“Not only that, the operational review done by the third party, as well as further review done by the central bank, will take into consideration whether the platforms are adequately secured,” he added.

Asked whether Axiata would be reviewing its entire portfolio, including asset sales, chairman Tan Sri Shahril Ridza Ridzuan clarified that the group is constantly looking at reviewing its portfolio to ensure the group can take advantage of the future. 

“Not just sales and purchase but also consolidation. We are looking at consolidation in Sri Lanka and Indonesia, where we have acquired PT Link Net Tbk,” he added.

-- BERNAMA