A buy-now-pay-later (BNPL) platform in Malaysia has secured a Shariah compliance accreditation in a bid to capture the Muslim market.
Founded in 2020, Riipay is the latest BNPL company to tap the Malaysian market with a Fatwa, following the likes of IOUpay.
“By offering Shariah compliant options, we hope to provide a more inclusive and diverse range of financial products and services that meet our customers’ beliefs and values,” the company said. “This certification is a significant milestone in our journey toward providing ethical and sustainable financial solutions that benefit our customers.”
The certificate was issued by Masryef Advisory.
With a Shariah stamp of approval, Riipay has opened the doors to Muslim merchants and consumers as well as enhanced its chances for partnerships with Islamic financial institutions in a country widely considered as one of the most sophisticated Shariah financial markets in the world.
Despite its controversies, BNPL is gaining popularity in Malaysia, with the likes of Atome and Split also offering Halal options. Research and Markets forecast BNPL activities to grow at a compound annual growth rate of 35.4% between 2022–28. BNPL gross merchandise value is expected to rise to US$6.88 billion by 2028, up from US$625.3 million in 2021.
“The digital payment method is projected to go mainstream over the next three to four years on the back of growing adoption among merchants and consumers,” noted the research firm.
The mainstreaming of this model has grabbed the attention of the regulators: Bank Negara Malaysia is working on regulating BNPL activities under the Consumer Credit Act which may subject BNPL firms to a RM2 million (US$452,556) minimum requirement.