The race for an Islamic digital banking license in Malaysia has indeed attracted an interesting pool of contenders including a public listed agrochemicals company which is going at it with two other partners.
Hextar Global confirmed this week that it has applied for a digital banking license as part of a consortium comprising investment holding company Arcadia Acres and Ihsan Equity, an SPV set up by Fass Payment Solution, an e-money license holder.
“We have been keenly looking at the digital economy as an area for us to expand into and to complement our current businesses. With a platform of eight listed entities within the larger Hextar group of companies which are involved in a wide range of industries such as agriculture (agrochemicals and fertilizers), healthcare (rubber gloves), telecommunications (fiber optic cables), renewable energy (solar), logistics and consumer products, we are able to provide access to layers of thriving ecosystems which could be tapped by the bank. Hence, our excitement at being part of this collaboration,” shared Eddie Ong Choo Meng, the executive director of Hextar Global. “Arcadia has prepared a very comprehensive proposal which sets out clearly a blueprint to promote financial inclusion and literacy especially among the underserved through digital banking services which are also Shariah compliant.”
Arcadia is a familiar tech name having been involved in several government endeavors.
“Our involvement and extensive experience in government projects involving digital technology and familiarity with operating in highly regulated environments are through our investee companies, namely Dagang NeXchange (DNeX) and Theta Edge, which provide us with the expertise to understand the requirements and to build an optimal infrastructure for the bank based on leading-edge technology,” explained Zainal ‘Abidin Abd Jalil, themanaging director of Arcadia.
DNeX is currently the Malaysian government’s caretaker and exclusive service operator for the business-to-government national single window for trade facilitation system for the Royal Malaysian Customs Department and Malaysia Quarantine Services. Close to 100 million electronic transactions and approximately RM8 billion (US$1.9 billion)-worth of customs duty payments are transacted annually through DNeX’s infrastructure.
Theta on the other hand designed, developed and maintains a suite of applications, known as Haj Mobility, to digitalize the operations and management of Hajj. The application focuses on crowd and logistics management for the mass movement of pilgrims.
The other pillar of the trio is Ihsan whose chairman, Abu Huraira Abu Yazid said: “With FassPay’s experience in marketing, distribution and merchant onboarding for mobile payment systems, specifically mobile point-of-sales or mPOS, the bank will immediately have access to the requisite technology and expertise to commercialize its business and come to market in a short period of time.”
FassPay is understood to be the only company in Asia and the second in the world with EMV (Europay, Mastercard and Visa) certification for its cloud mobile card acceptance solution. More than 30 banks in Malaysia, Singapore, Thailand, Vietnam, Taiwan, Indonesia, Australia and New Zealand are licensing the Soft Space — the holding company of FassPay — payments technology. Here is a breakdown of all known entities bidding for an Islamic digital banking license in Malaysia.