Cash will continue to play an important role in Malaysia, even as regulators, consumers and retailers join the ongoing movement to become a cashless society. In an interview with The Edge Malaysia Weekly, Hari Sivan, founder and CEO of fintech start-up soCash commented: “In fact, consumers will increasingly seek convenient access to cash because banks are reducing their physical reach and digitalising their services.”
He plans to launch soCash in Malaysia by the end of this year. According to him, the start-up already has approval from Bank Negara to operate in the country. soCash is currently in talks with several big banks and retailers in Malaysia to strike up partnerships. The retailers that the company is targeting are those with low-value but frequent transactions.
“Malaysia is a good place to expand because more than 90% of the people are banked but do not have access to banking services because their network is reducing. We are not competing with other cashless players. We are only competing with ATMs and cash logistics companies,” says Sivan.
“In my view, cash is the efficient payment system for low-value transactions because these are free, universally accepted and instantly settled between parties. It would be prudent to review if the promotion of a cashless economy is actually the solution to the problems that it is supposed to solve, or if it is mostly paid propaganda financed by payment intermediaries, who are driven by the potential of recurring revenue and data collection opportunities,” says Sivan.
At the same time, he adds, it is becoming harder for consumers to get access to cash because banks are reducing the number of branches and ATMs to save costs.
These observations led Sivan to create soCash in Singapore three years ago. Prior to this, he worked at Citibank for 15 years and DBS Bank in Singapore, dealing with mobile and internet banking, wealth management, payments and remittances, among others.
soCash’s business model is simple. It will enable consumers to withdraw or deposit cash from merchants in Malaysia instead of having to look for an ATM.