Aeon eyes Q2 launch of Islamic digibank for Malaysian Gen Z, MSMEs

The Kuala Lumpur cityscape / Photo credit: Wikicommons

Aeon Bank, which holds a Malaysian digital banking license, looks to roll out the country’s first Islamic digital banking services by the end of the second quarter, Fintech News Malaysia reported, quoting The Star.

The bank’s app will target Gen Z and underserved small businesses, according to CEO Raja Teh Maimunah.

The bank was formed by a consortium consisting of Aeon Credit and Aeon Financial Services – all under the Japanese conglomerate Aeon – as well as MoneyLion, though the US-based neobank left the group in May last year.

Aeon Bank plans to begin operations with simple offerings, which include savings accounts, and aims to introduce more complex products and financing solutions as it progresses.

Fitting into the global shift toward cashless transactions, the bank strives to close a 90 billion ringgit (US$18.8 billion) funding gap faced by small businesses that are ignored by big banks.

By 2025, the bank plans to launch services for businesses, especially those using social media platforms like TikTok and Instagram. Such businesses are, according Aeon Bank, often overlooked by typical banks. This holds significance as TikTok Shop alone hosts more than 1 million sellers on its platform in the country alone.

The Aeon-led consortium is among the five groups granted approval to launch digital banks in Malaysia in 2022. Three of these consortia will operate conventional digital banks: Boost and RHB; Grab-Singtel and Kuok Brothers; and YTL Digital Capital and Sea Group.

The remaining two will operate Islamic digital banks. Alongside Aeon’s group, a consortium consisting of KAF Investment Bank, Carsome, Jirnexu, and MoneyMatch also holds this license.

See also: Malaysia’s digibank race heats up: 3 things to watch

Currency converted from Malaysian ringgit to US dollar: US$1 = 4.78 ringgit.