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Malaysia e-commerce payments to top US$15 billion by 2028
Enhanced payment infrastructure, rise of digital payment solutions driving further growth
Tom King 9 Oct 2024

Malaysia’s e-commerce market is expected to reach 67.1 billion ringgit (US$15.65 billion) by 2028, driven by a sustained shift towards online shopping, according to a new report from data and analytics company GlobalData.

The forecast figures represent a compound annual growth rate (CAGR) of 8.5% over the 2024-2028 period, reflecting the country’s rapid embrace of digital payments.

The analysis reveals that Malaysia’s e-commerce sector grew by 12.2% to reach 43.5 billion ringgit (US$10.1 billion) last year. Ravi Sharma, lead banking and payments analyst at GlobalData, attributes this growth to increased internet and smartphone penetration, secure payment systems, and rising consumer confidence in online transactions.

"Malaysia is among Southeast Asia’s fastest-growing e-commerce markets, with online shopping festivals like Black Friday and Single’s Day adding to the momentum," says Sharma.

Alternative payments

The National E-Commerce Strategic Roadmap (NESR), introduced by the government in 2016, has also played a significant role in boosting the industry.

The initiative's first phase (2016-2020) laid the groundwork for an integrated digital marketplace, and the second phase (2021-2025) is focused on further adoption, regulatory enhancement, and ecosystem development.

By 2023, 1.51 million small and medium-scale enterprises had embraced e-commerce, according to the Malaysia Digital Economy Corporation (MDEC).

Alternative payment methods have emerged as the most popular choice for e-commerce transactions, accounting for 35.7% of the market last year.

Platforms such as Grab Pay and ShopeePay have gained prominence mainly because of the ease of use and convenience, alongside global brands like PayPal and Google Pay. Credit cards follow as the second most-used payment method, favoured for their rewards and cashback programmes, representing 24.9% of transaction value.

Looking ahead, Malaysia’s e-commerce payments are projected to grow by 11.3% to reach 48.5 billion ringgit (US$11.3 billion) in 2024. "The future of e-commerce in Malaysia looks promising, with enhanced payment infrastructure and the rise of digital payment solutions driving further growth," Sharma adds.