AEON Bank Berhad, formerly known as ACS Digital Berhad, announced on January 8, 2024 that Bank Negara Malaysia (BNM) and the Ministry of Finance has approved for it to commence its digital banking operations in Malaysia.
This positions AEON Bank as the first Islamic digital bank in the country. According to a press release, BNM’s approval was granted in accordance with its validation of AEON Bank’s operational readiness.
On the same day, the Boost-RHB Bank consortium has also received the official approval to commence operations of its digital bank, Boost Bank. Its Alpha testing is opened by invitation to a select group of customers.
AEON Bank is an associate company of AEON Credit Service (M) Berhad (ACS) and a subsidiary of AEON Financial Service Co., Ltd. (AFS).
In April 2022, it was announced that ACS, AFS, and MoneyLion were one of two consortiums approved for a digital banking licence under the Islamic Financial Services Act 2013 (IFSA).
MoneyLion, a US-based neobank company, has since pulled out of the consortium.
The other consortium that was given an Islamic digital banking licence was KAF Investment Bank.
ACS is a non-bank financial institution that has been operational in Malaysia since 1996, providing services such as the issuance of credit cards, easy payment schemes, personal financing, and insurance.
In short, it promotes financial inclusion by providing access to financing to individuals who have traditionally not been able to access funding.
Similarly, AEON Bank’s core mission is to advance the promotion of financial inclusion as well as Islamic banking, said Raja Teh Maimunah, the CEO of AEON Bank.
“As part of one of Malaysia’s most recognised retail household brands, we aim to provide accessible, inclusive and Shariah-compliant digital banking solutions to our AEON Group of customers as well as to all Malaysians,” he said.
Offering new, innovative products
Having been present in Malaysia since 1984, AEON is a highly recognised household name that has served Malaysians nationwide.
With AEON Bank now in its group of companies, AEON Group aims to further expand and enhance its services to retail and wholesale customers as well as ecosystem partners such as auto dealers, merchants, suppliers, tenants, and more, the release said.
To this end, the digital bank will introduce “new and innovative products” for the AEON Group.
One of AEON Bank’s priorities is financial literacy and education initiatives to empower individuals and small businesses, providing knowledge and tools for them to make informed financial decisions.
Beyond educational efforts, the digital bank shared it will extend financial services to individuals and small businesses who otherwise would not have access to funding and other financial services.
According to the release, the AEON Bank app will be rolled out in phases, starting with an exclusive beta testing phase which is open to AEON Group’s employees. Feedback from these users will be gathered to refine the app.
AEON Bank targets to unveil its phased rollout in the first half of this year.
Ushering in a new era of digital banking
In November 2023, Malaysia welcomed our very first digital bank through the Grab-powered GXBank.
Having tested out the app, we were able to understand how digital banks can better serve underbanked Malaysians in a way that traditional banks may not be able to.
With AEON Bank joining the scene, which will also strive to serve the Islamic market, we hope to see even more innovative solutions to promote a more financially inclusive Malaysia.
- Learn more about AEON Credit Service here.
- Read other articles we’ve written about digital banking here.
Featured Image Credit: (From left) Raja Teh Maimunah, CEO of AEON Bank; Daisuke Maeda, Managing Director of AEON Credit
