Key Budget 2023 takeaways for entrepreneurs and SMEs in Malaysia
During Budget 2023 today (October 7), Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz announced the latest and largest budget allocation in Malaysian history at RM372.3 billion.
Here are the key takeaways from the tabling for entrepreneurs and SMEs in Malaysia.
1. Personal income tax reduction for those earning between RM50,001 to RM100,000
The tax rate for individuals making RM50,001 to RM70,000 will be reduced by 2%, going from 13% to 11%.
Similarly, the rate for those in the RM70,001 to RM100,000 bracket will go from 21% to 19%
2. Income tax reduction for MSME operators
There will be a 2% tax reduction for micro, small, and medium enterprises (MSMEs) for the first RM100,000 in earnings. This means the rate will be reduced from 17% to 15%.
3. One-off grant to all registered MSMEs
Registered MSMEs and taxi drivers will be eligible for a one-off RM1,000 grant.
With a total allocation of RM1 billion, this is an initiative that is expected to benefit a million people.
4. Support to automate and digitise SMEs
RM10 billion in funds from Bank Negara Malaysia will be provided to SMEs. This will go towards automation and digitisation efforts.
5. Increased Semarak Niaga funds to support entrepreneurs
RM45 billion will be allocated for the Semarak Niaga Keluarga Malaysia, an RM5 billion increase from last year.
This includes an RM1.7 billion micro-loan fund. Included in that is an allocation of RM350 million for the Penjaja Kecil Keluarga Malaysia scheme and RM150 million for Bumiputera businesses.
Under TEKUN small business loan schemes, there’ll also be an allocation of RM300 million specifically for Bumiputera, women, youth, and informal sectors.
RM200 million is prepared for business loans of Chinese entrepreneurs, with interest rates as low as 4%.
RM25 million is allocated for micro-loan facilities under the Pembiayaan Ushahawan Masyarakat India (SPUMI). RM100 million is also prepared under the Malaysian Indian transformation Unit (MITRA).
Through iTEKAD, a blended social finance programme by Islamic banks, the government is allocating RM10 million that will be matched by financial institutions via zakat payments and cash endowments.
6. Further support for Bumiputera entrepreneurs
Via TERAJU, a fund of RM135 million will go towards financing facilities for Bumiputera entrepreneurs.
RM200 million will also be provided under Perbadanan Usahawan Nasional Berhad (PUNB) to provide financing and entrepreneurship development programmes for Bumiputeras in the retail and distribution trade sectors.
7. Special funding for female entrepreneurs
This support will be distributed through schemes including Semarak-Nita BSN, Terkunita TEKUN, Dananita MARA, Biz Lady Bank Rakyat.
8. Support for young entrepreneurs
The government is providing a total of RM305 million through the Penjaja Muda scheme to encourage youth entrepreneurs.
With support from SME Bank, TEKUN, MARA, BSN, and Agrobank, a fund of RM50 million will allow 10,000 youngsters to get loans of up to RM50,000.
The government will bear the taxi, bus, and e-hailing licence fees under the MyPSV programme. It will also bear the fees of driving tests for motorcycle licences (B2 Class).
The TEKUN Youth Mobileprenreur Scheme will also continue with a fund of RM10 million to support young Malaysians working as delivery riders on motorcycles.
Come April 2023, there will also be a Malaysian Family Youth Package whereby youths can get three months’ worth of pre-paid internet data plan for RM30.
Individuals aged 18 to 20 can also expect the return of e-Pemula, this time with an amount of RM200.
9. Incentives to hire jobless youths, the disabled, Orang Asli, ex-convicts, and women
SOCSO will give incentives to employers hiring youths (aged 18 to 30) who have been unemployed for more than three months.
The incentive is also extended to employers who hire graduates of Technical and Vocational Educational Training (TVET).
SOCSO will further provide from RM600 to RM750/month of incentives to employers who hire persons with disabilities, Orang Asli, ex-convicts, and women returning to work. The incentive will only be given for three months per employee.
Incentives will also be provided to veterans as well as employers and private sector agencies who replace foreign workers with local workers.
There will also be additional tax deductions for employers who hire former residents of The Henry Gurney Schools, shelter homes, juvenile detention centres, and those who’ve left JKM.
10. Mandatory security contributions for self-employed
Self-employed individuals will be required next year to make Self-Employment Social Security Scheme (SKSPS) contributions.
To support gig workers such as food delivery riders, fisherman, artists, and more, the government will bear 80% of the contributions.
11. Increased voluntary EPF contribution limits
An increase from the existing RM60,000 limit, Employees Provident Fund (EPF) contributors will be able to make voluntary contributions up to RM100,000 yearly.
12. Continuation and improvements for i-Saraan programme
i-Saraan, a retirement incentive programme for the self-employed, will be extended for the next year.
RM30 million will be allocated to improve it with the aim of benefiting 100,000 people. This was a similar budget given to last year’s initiative.
The matching contribution will be increased from RM250 to RM300.
13. Increased guarantee limit for SMEs
Through the Business Financing Guarantee Company, a guarantee limit of up to RM9 billion will make it easier for SMEs to get financing. This will be targeted at strategic industries such as agrofoods, sustainable technology, tourism, and oil and gas.
14. Increased support for Malaysian-made products
In promoting the production and purchase of goods and local services, the government will be allocating RM59 million to increase digitisation and automation efforts. This will be done through e-commerce activities via MATRADE, MARA, and MDEC.
An allocation of RM15 million will go towards empowering franchise entrepreneurs. RM15 million will go towards the Made in Malaysia campaign to encourage the purchase of locally made products.
15. Increased support for startups
To support the development of local startups, RM50 million will be going to Cradle Fund, the coordinating agency of Malaysia’s startup ecosystem. This is more than double the RM20 million allocation for Cradle Fund last year.
16. Popularising digital nomad culture
Malaysia’s recently launched DE Rantau, a programme promoting digital nomads, is expected to benefit 120 startups and contribute more than RM180 million to the economy.
As such, DE Rantau will provide six new locations including 2,000 short-term rental accommodations known as Digital Nomad Hubs next year.
17. The introduction of a innovation hub
The government is providing an initial allocation of RM18 million for the MRANTI Technology Park, which is designed to be a world-class innovation hub with clusters such as health technology and smart products.
18. A multi-tiered levy for foreign workers
Companies with a high number of foreign workers such as those in the plantation and construction sectors will be charged a higher levy rate.
The government plans to redistribute the additional levy revenue to support employers’ automation initiatives.
This policy incentivises and helps employers reduce dependency on foreign workers.
- Read more of our Budget 2023 coverage here.
- Read what Tengku Zafrul had to say about what to expect from 2023’s finance industry here.
Also Read: 4 M’sian entrepreneurs share their worst business crisis, and how they triumphed through
Featured Image Credit: Tengku Zafrul
As year-end floods draw near again, here’s how the govt is preparing to help M’sians
We all know how badly the floods impacted parts of Malaysia last year, resulting in tragedies and losses amounting to billions of Ringgit.
The public actively pitched in to help with search and rescue as well as with welfare efforts that the previous year’s budget had not prepared for.
This year, Budget 2023 is more prepared, and here are the initiatives that will be relevant when it comes to preparing Malaysia better for flash floods and other water-related natural disasters.
The government will implement a flood mitigation plan until 2030 as a long-term strategy to adapt to climate change throughout the country with a total value of RM15 billion.
For the year 2023, most of the projects will be awarded a budget expenditure of RM700 million. Among the main projects that will be carried out include:
- The implementation of the Sabo Dam project worth RM500 million in 46 locations across the country to reduce the risk of landslides and mudslides, which were the cause of the tragic floods in Baling, Kedah.
- The construction of a dual-function reservoir pool worth approximately RM2 billion involving the alignment along the river Klang and Sungai Rasau, Selangor as a two-pronged strategy to overcome the problem of flooding and as a source of raw water supply storage.
- The additional phase project of Lembangan Sungai Bersepadu in Sungai Golok, Kelantan worth RM500 million.
- Upgrading the weather forecast system to advance flood forecast and warning at the national level.
For the next year, the National Disaster Management Agency (NADMA) will be allocated a total of RM174 million.
As a preparatory step, the Ministry of Finance will continue to channel an additional RM400 million to NADMA for it to be ready to help immediately if there is a flood at the end of this year.
The government has also prepared an initial allocation amounting to RM100 million under the National Disaster Relief Fund, and the Ministry of Finance is ready to increase its allocation as needed.
As a preparatory step for the Malaysian Armed Forces in case of any disaster, two additional field hospitals involving a cost of RM47 million will be completed by the end of this year in Kluang, Johor, and Kota Kinabalu, Sabah.
In addition, as many as 50 units of ambulances will be stationed at military camps, ready for deployment to help in the event of a disaster.
The government will also be providing RM20 million under the Geran Pertubuhan Prihatin Komuniti for the benefit of 2,000 resident associations to implement volunteer activities.
Among them include participating in a firefighting course to prepare yourself in case of any disaster such as floods and fires at the community level.
- Read more about Budget 2023 here.
- Read about our lessons learnt when helping with flood cleanup here.
Also Read: Health is no laughing matter, so Harith Iskander & wife Dr Jezamine launched a wellness line
Featured Image Credit: Wikimedia Commons
Budget 2023: 13 initiatives relevant to employers, employees & the self-employed in M’sia
During the Budget 2023 tabling on October 7, 2023, Finance Minister Tengku Zafrul Aziz announced an allocation of RM372.3 billion.
This is an RM40.2 billion increase compared to the RM332.1 billion allocated for Budget 2022 last year.
Approximately RM272.3 billion has been allocated for operational expenditures, while RM95 billion will go to development.
Here’s what employers, employees, and the self-employed in Malaysia can expect from Budget 2023.
1. Personal income tax reduction
Those earning between RM50,001 to RM100,000 will have their personal income tax reduced by 2%. This is geared to benefit over one million people in the M40 income bracket.
The taxable income range of RM50,001 to RM70,000 is reduced from 13% to 11%, and the income range of RM70,001 to RM100,000 is reduced from 21% to 19%.
2. Income tax exemptions for women returning to work
There will be income tax exemptions for women returning to the workforce between 2023-2028.
3. Incentives given to employers to hire youths
Despite our many graduates from higher education institutions, Tengku Zafrul reported that about 11% of our youth is still unemployed as of Q2 2022. Thus, SOCSO will provide incentives for employers to hire jobless youths.
This will be applied to youths between the ages of 18 to 30, who’ve been unemployed for over three months, and to graduates of Pendidikan Teknikal Dan Latihan Vokasional (TVET).
4. Voluntary EPF contributions raised
Voluntary EPF contributions will be raised from RM60,000 to RM100,000 next year. The government will also expand the scope of insurance premium tax relief or Life Takaful contribution up to RM3,000.
5. Improvements to the i-Saraan programme
Extending the duration of i-Saraan for the next year, RM30 million will be allocated to improve it with the aim of benefiting 100,000 people. This was a similar budget given to last year’s initiative. The matching contribution will be increased from RM250 to RM300.
6. The self-employed must contribute to SOCSO starting 2023
In stages from next year onwards, all self-employed persons will be required to contribute to SOCSO’s Skim Keselamatan Sosial Pekerjaan Sendiri (SKSPS), especially those in higher-risk professions.
These include those in the public transport and food or package delivery sectors.
The government will subsidise 80% of the contribution value, thus, the self-employed doing food delivery, farming, fishing, creative freelancers working with Finas, and traders will only have to contribute 20%.
RM150 million will be allocated for this, and it is extended to taxi drivers and gig workers in the technology and information sector.
7. SOCSO incentives for employers to hire more
SOCSO will provide incentives for employers to hire the disabled, Orang Asli, ex-convicts, and women returning to work.
The incentive that’s worth RM600 up to RM750 per month will be given for three months per employee. In total, RM150 million will be allocated for this, and it’s expected to benefit 70,000 job-seekers.
8. Mobility assistance from PERKESO
RM500 will be granted to those who find work outside of their residential state, while RM1,000 will be given to those from Sabah and Sarawak who travel to Peninsula Malaysia for work.
9. MyStep programme to provide 50,000 jobs
The MyStep programme will provide 50,000 jobs including 15,000 in the public sector and 35,000 in GLCs.
10. Worker upskilling initiative
RM750 million will go to upskilling 800,000 workers, courtesy of HRD Corp. In 2022, this initiative got an allocation of RM1.1 billion targeting 220,000 trainees to undergo various upskilling and reskilling programmes.
11. Tax deductions for employers hiring former juveniles
There will be additional tax deductions for employers who hire former residents of The Henry Gurney Schools, shelter homes, juvenile detention centres, and those who’ve left JKM.
12. Income tax reduction for micro-SME operators
There will be a 2% reduction in the income tax of micro-SME operators, from 17% to 15%, for the first RM100,000.
13. DE Rantau programme to support professional mobility
Exclusive to digital nomads, which are defined as digital freelancers, independent contractors, or remote workers, the DE Rantau programme aims to establish Malaysia as the preferred digital nomad hub.
It’s meant to boost digital adoption, and promote digital professional mobility, along with uplifting tourism across the nation. Read more about its benefits for local digital nomads here.
- Read more of our Budget 2023 coverage here.
- Read what Tengku Zafrul had to say about what to expect from 2023’s finance industry here.
Also Read: Health is no laughing matter, so Harith Iskander & wife Dr Jezamine launched a wellness line
Featured Image Credit: Tengku Zafrul
Ponzi scheme or game-changer: Binance execs comment on the future of crypto in fireside chat
It’s tough to find a middle-ground when discussing cryptocurrency. As Binance CCO Patrick Hillmann noted at a fireside chat in September, “one of the biggest challenges we have is that a lot of the conversation around crypto [falls into two categories].”
On one hand, there’s the idea that the entire industry is a Ponzi scheme, which will disappear in a year’s time. On the other, there’s the belief that crypto will change the world and our fundamental behaviours.
“The reality is it’s not going to be either of those things,” says Hillmann. “At some point, this is going to be an underlying technology which changes the way functions interact with each other.”
It’s not as attractive a statement, but in Hillmann’s view, a more realistic take. Blockchain technology spans various business verticals, and its impact on these fields could vary significantly. Social media could forever be changed by the advent of the metaverse, in a way which is very visible to the end users.
In the finance industry, the effects could be more subtle. Companies like Ripple are integrating blockchain-based payment solutions in partnership with TradFi institutions. In this case, customers enjoy lower transaction fees thanks to blockchain technology, without even being aware of it.
Will blockchain have the same impact as the internet?
“Today, you don’t think about the internet,” says Richard Teng, Regional Head at Binance. “It’s a part of life and has transformed various business models — entertainment, financial services, e-commerce.”
To explain the current state of crypto, Teng refers to a conversation between Bill Gates and talkshow host David Letterman from 1995. In this conversation, Gates attempts to explain what the Internet is, and why it’ll be “the next big thing”.
Letterman is skeptical, questioning why someone would listen to a sports game commentary on the internet when they could use a radio instead; or why they would look for information online when they could get it from a magazine.
People tend to overestimate technology when the time horizon is very short and underestimate technology when the time horizon is very long.
– Richard Teng, Regional Head at Binance
Teng believes that in the long-term, blockchain technology is going to transform different industries, especially in the Web3 space. “People look at crypto right now, and it’s one of the most important use-cases, but it’s not the only blockchain use-case.”
“[Blockchain technology] is going to transform how value is being transmitted,” says Teng. It’s a comparison to how the internet transformed the way information was being transmitted.
“Look at the current state of financial services. There are still a lot of frictions that we see. For instance, if you make a payment today, the merchants won’t get their money until many days later. If you do an international transfer, it’s very costly. These things will be totally transformed by blockchain.”
How Binance is shaping the future of blockchain
Although it’s best known for its crypto trading platform, Binance offers a lot more than that. The company is the biggest blockchain and crypto infrastructure provider in the world. It offers services across different business verticals.
Binance Pay looks into payment solutions, Binance Labs invests and empowers blockchain startups, while Binance Charity explores the use of blockchain in philanthropy — and those are just a few examples.
We’re one of, if not the largest investors in the blockchain ecosystem, with more than 200 projects under our belts. We continue to support crypto adoption globally and we’re working closely with policymakers and government agencies in reimagining the future of the Web3 space.
– Richard Teng, Regional Head at Binance
Building on this point, Hillmann speaks about what Binance looks for when investing in other projects. “We’re not looking to buy the next big hot thing in the industry,” he says. “We’re trying to identify those trends and projects which are eventually going to create real impact on people’s daily lives.”
“The reality is we don’t have that yet,” Hillmann continues. Going back to the comparisons between blockchain and the internet, he says, “It’s not even 1999.”
Hillmann believes that blockchain could still be a long way from the stage the Internet was during the dot-com bubble. “There are still going to be a lot of bear markets, and there may even be a much worse bear market than we’re going through now. That’s part of a healthy process.”
With each of these market cycles, the crypto industry is primed to grow and evolve. Through initiatives like Binance Labs, Binance aims to support blockchain innovation and keep pushing the industry in the right direction.
The regulatory elephant in the room
Innovation and regulation often go hand-in-hand, and it’s tough to speak about one without covering the other. Over the years, Binance has had its fair share of run-ins with regulators.
In December 2021, the company withdrew its application to be licensed in Singapore. In July 2022, it was fined €3 million by the Dutch Central Bank for offering crypto services without registration.
“We are very committed to working with global regulators. We are the most regulated platform globally,” says Teng, mentioning countries including France, Spain, USA, Canada, Dubai, and Australia.
Beyond the requirements of regulators, the company goes above and beyond to ensure ethical and secure operations. “We have strict rules internally and people are let go for breaching those. Our internal practices are above those imposed by regulators.”
Although Binance is often in the spotlight for its regulatory challenges, Teng explains that this isn’t a problem unique to the company.
“As the largest player, regulators start focusing on us before making their way through the list. That doesn’t mean that it’s [only] our problem. It’s the entire crypto industry.”
Featured Image Credit: Binance
Also Read: From mass adoption to regulation: VCs and execs discuss the future of crypto to navigate ahead
Move aside third-wave coffee, these M’sians are on a mission to popularise kopi kampung
Before Starbucks, San Francisco Coffee, and all those fancy, hip cafes, there were mamaks and kopitiams. It was at these kinds of roadside stalls where Azzad and Hadi started their lifelong coffee-drinking habit.
The two met at work, with both of them having backgrounds in IT. Today, they’re still working together, with the main difference being it’s not in the field they studied anymore.
When it comes to coffee culture nowadays, people typically think of high-end cafes using espresso machines and expensive beans, serving what’s typically called third-wave coffee.
Drinks like vanilla lattes, cappuccinos, and caramel macchiatos have become mainstays and even many young Malaysians’ introductions to coffee today.
However, Azzad and Hadi had grown up on kopi kampung and wondered what it would be like to start a kopi kampung brand but dressed up in a more modern way.
Azzad already had some F&B experience since his family owns a coffee stall and used to run a kopi kampung roaster back in Kedah. So, amidst the pandemic, the partners decided to start their own brand—Kopi Dua Darjat.
Coffee for the unpretentious
To some “coffee fanatics”, kopi kampung might not seem like “real coffee”. This was something that Azzad and Hadi had observed, so they decided to name their store Kopi Dua Darjat as a reference to those “double standards”.
For those who are unaware, kopi kampung generally is made with Robusta beans, which are cheaper and more bitter compared to Arabica beans. According to Hadi, this was more accessible in Malaysia due to our climate and altitude.
“Our older generations find Robusta too bitter to drink on its own so they roasted the Robusta beans with sugar, margarine, and sometimes palm oil to make them taste better,” he described.
“All these additional ingredients blended together give the ‘kaw’ taste to kopi kampung that we won’t be able to get from pure Arabica coffee.”
This kind of coffee is also known as Hainan Kopi, which might be a familiar term to some. Kopi kampung and Hainan kopi became the foundation of coffee in kopitiams, mamak stalls, and now, Kopi Dua Darjat.
At Kopi Dua Darjat, rather than using espresso shots, popular coffee beverages such as vanilla lattes are created using kopi kampung.
However, Azzad and Hadi never meant to promote Kopi Dua Darjat as a fully kopi kampung brand. They originally used the term as a disclaimer for customers so they know the coffee isn’t produced from espresso machines, “just to manage their expectations.”
In hindsight, it seems like the reception of kopi kampung might’ve actually exceeded their expectations.
Spreading the kampung style
Beyond just offering kampung-style coffee, the duo wanted to offer a whole kampung-style experience.
Thus, they chose to go with a roadside stall concept for starters.
“Within months, a lot of our customers were noticing the brand and they became interested to open an outlet under the same brand,” Hadi shared.
This was happening during the pandemic when many were losing their jobs. So, Hadi and Azzad decided to give people the opportunity to earn while they could expand the brand—a win-win situation.
So, they started franchising, allowing more people to open a Kopi Dua Darjat outlet. The company would supply the ingredients to them and take a small percentage of their revenue. It would also provide training and conduct R&D for new menu items.
“To make it more affordable for most people to open an outlet, we maintained the concept to operate as roadside stalls,” Hadi said.
However, he said that the company is flexible when it comes to the concept because it all boils down to the owner’s own capacity and budget.
For instance, there’s a Kopi Dua Darjat outlet operating as a permanent kiosk in Central Market, and there are several Kopi Dua Darjat food trucks in Lakefield Sungai Besi, Putrajaya, and Seremban 2.
Kopi Dua Darjat is also gearing up to open its first mall outlet in Metro Point Kajang around November. Other than the signature kopi kampung drinks, it plans to venture into espresso-based drinks too.
“Our end game has always been to open physical kiosks or cafes all around Malaysia,” Hadi revealed. “However, we see ourselves as a startup that was not made of money, so we believe in taking small baby steps in growing the business.”
Down the roadside
Today, Kopi Dua Darjat has around 50 outlets in KL, Selangor, and Negeri Sembilan, though only two outlets (and the upcoming mall outlet) are directly owned by Kopi Dua Darjat HQ.
The main issue the team is facing right now is logistics. According to Hadi, there is high demand all over the country to operate Kopi Dua Darjat, but the HQ doesn’t have the proper supply chain ready to open in areas outside of KL, Selangor, and Negeri Sembilan.
With that said, the team does anticipate setting up shop in other states soon, starting with Melaka and Perak.
Hadi also revealed that the brand may be launching its own retail products soon, such as Dua Darjat flavoured syrups.
“I believe that kopi kampung has a special place in us Malaysians, since this is the coffee that most of us drink growing up,” Hadi expressed.
However, even those who started their coffee journey with Arabica coffee and fancy espresso machines may enjoy kopi kampung too, if Kopi Dua Darjat’s expansion is anything to go by.
Also Read: 4 M’sian entrepreneurs share their worst business crisis, and how they triumphed through
Featured Image Credit: Kopi Dua Darjat
GXS vs Trust: A comparison between the two digital banks, and should you sign up for one?
Competition in Singapore’s banking space is heating up with the arrival of digital banking on its shores. It joins the likes of Hong Kong and the United Kingdom in embracing digital-only financial services and positioning itself as a regional centre for fintech innovation.
For the uninitiated, digital banks are banks that exist entirely online without any physical branch operations, such as the ones you may be accustomed to with traditional banks. All banking activities, including customer service, are conducted through the digital bank’s respective apps.
The past month alone saw two rival digital banks, Trust and GXS, launch their respective apps just days apart.
Trust Bank is the product of a unique joint venture between Standard Chartered and FairPrice Group, while GXS is formed by the Grab-Singtel consortium. They join the likes of Ant Group’s ANEXT Bank and SEA’s upcoming Maribank, in what has been termed a new wave of digital bank offerings in Singapore.
GXS and Trust at a glance
On the surface, both Trust and GXS are aimed at retail customers, but a closer look reveals that both banks come with their own value propositions that cater to different segments of the population.
Here is a table for quick comparison:
Product offerings
In 2020, the Grab-Singtel consortium was awarded one of two full digital banking licences from the Monetary Authority of Singapore (MAS), allowing them to take deposits and serve both retail and corporate customers.
Nearly two years later, GXS Bank was finally unveiled with the launch of a single product — the GXS savings account.
The GXS savings account offers a decent base interest rate of 0.08 per cent per annum, which is paid out daily with every S$0.01 earned. The daily interest accrual is a nice touch because it means that account holders can take advantage of compounding interest right from the start.
Account holders can also earn higher interest rates of up to 1.58 per cent through Saving Pockets (up to eight different pockets), a personalised, goal-setting feature within the Savings Account that is designed to incentivise savings.
Additionally, the GXS savings account does not impose any lock-in periods, fall-below fees, or minimum balance requirements as typically seen in traditional banks. However, there is currently a maximum of S$5,000 that account holders can deposit, thus limiting the amount they can earn in interest.
The GXS Savings Account is also not currently available to the masses as it is being rolled out progressively, starting with selected employees and customers within the Grab and Singtel ecosystem. While the GXS app is already available for download since 5 September 2022, registration for an account is subject to approval.
Unlike GXS, Trust Bank had no need for a digital banking permit, given Standard Chartered’s full banking licence. This enables Trust to offer a wider range of products and services, which includes a savings account, a Visa card that doubles as a credit or debit card, and even a family personal accident insurance.
Similar to the GXS savings account, Trust’s savings account is a “fee-less” account that has no minimum balance requirement, lock-in period, account closure fee or foreign transaction fee.
There is no maximum cap as to how much you can deposit into the account, which gives it an advantage over GXS. Trust’s savings account currently offers a one per cent per annum that is accrued daily and credited at the end of every month for deposits up to S$50,000 and 0.05 per cent per annum for deposits above S$50,000.
Bonus interest rates of up to 1.4 per cent (1.2 per cent for non-NTUC Union Members) can be earned on deposits up to S$50,000 when account holders make five purchases with their Trust card within the month.
As mentioned, the Trust card is a single card that can easily be switched between debit and credit through the Trust app for an unlimited number of times. There is no annual fee for using the card or card replacement fee should you lose it.
To top it off, there is also the option to withdraw money from the savings account at Standard Chartered ATMs islandwide or the sole Trust ATM at VivoCity.
Who are they for?
It might seem strange at first to think of Grab or Singtel as a bank. It starts to make sense when you consider the Group’s combined user base, which numbers around three million daily users.
They include existing e-wallet users on Grab’s GrabPay and Singtel’s DASH, as well as the numerous gig economy workers who frequently take up jobs via the Grab app. As of 2021, there are nearly 51,000 private-hire car drivers and delivery workers in Singapore.
This unique user demographic puts GXS in a good position to tap into these two ecosystems. The self-styled “Gen-Z digital bank” has stated that it aims to reach unbanked individuals — typically young people who have yet to start work or have just started employment — with “hyper-personalised” support.
On the other hand, Trust Bank aims to reach existing NTUC Union Members and frequent FairPrice shoppers.
The Trust NTUC Link Card in particular, allows for savings of up to 21 per cent (15 per cent for non-NTUC Union Members) at FairPrice Group businesses when you spend on credit, and up to 11 per cent (five per cent for non-NTUC Union Members) on debit.
However, do note that the savings rates for credit expenditure are an ongoing promotion that may be revised to 14 per cent (eight per cent for non-NTUC members) after 31 December 2022.
Sign-up promotions
Unfortunately, GXS does not currently have any sign-up promotions to offer. It’s quite possible that the digital full bank licence that regulates its banking scope prevents it from engaging in any value-destructive competition to gain market share, hence the lack of such promotions.
In contrast, Trust is aggressively touting various sign-up promotions, including the aforementioned 21 per cent savings, a S$25 FairPrice e-voucher, S$10 FairPrice e-voucher for every referral made, and most impressively, three Tesla Model 3 lucky draw giveaways.
Signing up for the Trust credit card also qualifies you for a family personal accident insurance policy that covers death and permanent total disability.
The coverage goes up to S$8,000, and new sign-ups will receive complimentary coverage for the first two months, thereafter paying a premium of just S$0.50 per month. The insurance policies are underwritten and issued by Income.
So, should you get a digital bank account?
Digital banks are perhaps most appealing to segments of the population who are unbanked or are unable to qualify for a traditional savings account. With little to almost no fees, digital banks can offer the perks of traditional savings accounts in addition to credit card services like the one Trust offers.
That being said, it is still worth considering a digital bank account, even if you already have a traditional one. Both GXS and Trust offer competitive interest rates compared to a typical savings account at a traditional bank, which would realistically earn around one per cent or less.
Furthermore, the daily interest accrual that both GXS and Trust offer would mean that interest is compounded at a faster rate than the monthly interest credited at traditional banks.
By harnessing the power of technology, digital banks are naturally more efficient and flexible than their traditional counterparts. By doing away with a physical branch, digital banks incur lower operating costs, which is then reflected in the fee-less banking services that they can offer.
On the flip side, those who still prefer to do their banking at a physical branch will not be able to do so with a digital bank. Existing as an online-only platform would also mean that digital banks are exposed to risks such as cyber-security threats or software failures and bugs. As such, it may be wise not to use it as a primary savings account.
For some assurance, GXS was awarded the Data Protection Trustmark by the Infocomm Media Development Authority (IMDA), a testament to their personal data protection capabilities. As for Trust, their security measures include intrusion detection systems (IDS) that monitor information flows for patterns of abnormal activity and data encryption algorithms that use unique encryption keys and encryption key management.
For the time being, both Trust and GXS are targeted toward specific segments of the population. GXS appears to be the obvious choice for gig economy workers and the unbanked.
However, if you are a frequent shopper at FairPrice or an NTUC Union Member, opening a Trust account might not be a bad idea at all, given the potential amount of savings and points that can be earned. Ultimately, the choice depends on your own needs and goals.
Featured Image Credit: GXS Bank / Trust Bank
Also Read: Grab and Singtel to launch its “Gen Z digital bank” GXS on Sept 5 – here’s what to expect
Freelance therapists need private offices, so this PJ coworking spot pivoted to serve them
Mental health was once looked at as a taboo topic in Asian societies. Malaysians have since warmed up to talking about it though, with the turning point brought on by the distress caused during the pandemic’s lockdowns.
Stress, anxiety, and a loss of direction due to the uncertain period have stirred a demand for counsellors and coaches, realised Albert Chee, who founded Nestspace Coworking Space (Nestspace) in 2019.
At the same time, Albert found that many certified freelance coaches and counsellors were looking for a space to counsel their clients that weren’t cafes.
This was because counsellors found that the openness and noise of a cafe didn’t make for a comfortable space for clients due to privacy concerns.
Thus, he saw the opportunity to pivot Nestspace to address these needs.
Dedicated rooms for one-on-one consultations
Primarily a coworking space upon its establishment, Nestspace targets healthtech and medtech startups. It’s part of Nestspace’s aim to build an ecosystem for health professionals and entrepreneurs to kickstart their services, collaborate, and innovate.
After the pandemic subsided, Nestspace redesigned part of its coworking space into coaching rooms to fill the gaps in the market mentioned above.
Today, Nestspace brands itself as a co-practising space for professionals like mind coaches, life coaches, counsellors, psychologists, dietitians, and fitness coaches to provide their services.
Nestspace only takes in licenced psychologists, therapists, or certified coaches to ensure their legitimacy.
The co-practising space provides cosy, affordable, and private rooms for such counselling sessions and the like.
Looking at the photos of Nestspace’s private coaching rooms, they do look like standard counselling rooms with couches and soft comfy furnishing in the space (at least the ones I’ve personally been to).
There are also dedicated desk spaces for professionals to do their paperwork at Nestspace, where they simply need to bring their laptops and stationeries.
Packages for varying levels
Launched just a couple of months ago, Albert reported to Vulcan Post that his team has already seen a few members signing up for their basic package. These members are also now transitioning from being part-time to full-time therapists.
Nestspace offers three different packages for its private counselling rooms:
- 4-Day Pass (RM125 per pax) – One-off pass for aspiring mental health coaches and counsellors to kickstart their practice before going full-time;
- Unlimited Pass (RM350 per pax per month) – For full-time coaches that want to access the space 24/7;
- Private Room (RM1,200 per month) – Shared plan where four pax can access the room.
Albert deems the fees affordable for counsellors and coaches, as the one-off RM125 fee is equal to or less than one therapy or coaching session. Hence, it’s best suited for those looking to kickstart their services.
Located at Damansara Utama, Nestspace facilitates about 10 rooms for coaches and counsellors, and allows sessions that last up to 60 minutes each.
“We are able to have at least 100 slots per day as we are open 24/7, and this is actually something the coaches and counsellors look for, as many of them have sessions after working hours,” Albert added.
Addressing security concerns
In Nestspaces’ daily operations, there will be coaches, counsellors, and their clients entering and exiting Nestspace during each 60-minute session rotation.
The co-practising space needs to be on top of its game in keeping track of each visitor, for security.
Albert shared that Nestspace operates on a pin-code basis. Once a coach or counsellor makes their reservation, a code will be shared with them that they can forward to their clients.
“The coaches and counsellors will be in charge and have all their clients’ details,” he stated.
In the pipeline, Nestspace will also be providing a booking system for coaches to book their rooms and for clients to make appointments with their coaches.
One-on-one counselling sessions and family coaching aside, Nestspace intends to build playrooms for early childhood psychology assessment and counselling too.
With the co-practising space being an advocate for mental health, their short-term plan is to work with their professionals to reach out to neighbourhoods, and provide a mental fitness space to all age groups.
Also Read: 4 factors why Millennials and Zillennials still don’t have a critical illness insurance
Featured Image Credit: The team at Nestspace Coworking Space
How GovTech makes use of crowdsourcing for insights from S’poreans, rewards them with vouchers
The Government Technology Agency (GovTech) has developed a gamified crowdsourcing web portal CrowdTaskS
The web portal’s tasks are created by GovTech in collaboration with other government agencies to meet their needs. For example, if a government agency requires to gather public opinion on climate change, it may utilise CrowdTaskSG to conduct surveys.
Most of the tasks take only a couple of minutes to complete, and comprise of a maximum of 10 questions. According to GovTech, it aims to provide at least 30 tasks monthly to keep users engaged.
Additionally, as users are required to link their Singpass accounts to CrowdTaskSG, data from Myinfo will be used to create personalised tasks for them. For instance, if you have children, you may receive tasks related to parenting.
This means that tasks cannot be shared between family and friends, and every individual has to sign up for their own set of personalised tasks.
The demographic screening through Myinfo was a recently added after GovTech ran a closed beta from March to May 2022 with around 300 citizens helping to test out the web portal.
“Feedback was generally positive and many stated that the portal was easy to use, fuss-
free and straightforward. Some of them also mentioned that earning rewards while having their
views heard was fun,” said the GovTech spokesperson.
What do Singaporeans stand to gain from it?
The web portal allows participants to earn virtual coins and experience points (XP) for every task completed. Coins can be exchanged for rewards such as vouchers, while XP allows them to climb up the ranks in the CrowdTaskSG community.
Up to 50 virtual coins and 100 XP can be earned with the completion of a task. In the beta phase now, 5,000 coins can be exchanged for a S$5 NTUC voucher.
“We intend to integrate GovWallet into CrowdTaskSG in the future to allow users to redeem cash
rewards,” said the GovTech spokesperson. GovWallet, an e-wallet launched by GovTech earlier this year, allows Singaporeans to instantly access government payouts through ATMs.
Meanwhile, users can progress past five ranks with sufficient XP: Stone, Bronze, Silver, Gold and Platinum. Upon attaining a new rank, coins can be earned as an incentive. All coins earned will expire on 31 March 2023.
On the other hand, XP earned through CrowdTaskSG do not expire.
However, if you are inactive on the portal, you will drop by one rank per year. In order to maintain your current rank, at least one task needs to be completed every year.
What kind of data does CrowdTaskSG collect?
According to GovTech, data collected via Myinfo is strictly for verification purposes, and to ensure the authenticity and reliability of citizens onboard CrowdTaskSG in addition to creating personalised tasks.
“We do not peg responses to any respondent. Instead, answers to tasks will be analysed by the portal, then aggregated and viewed collectively by government agencies, who can tap on these insights to help improve policies and processes,” explained the GovTech spokesperson.
Other than selected data from Myinfo, CrowdTaskSG also collects other forms of data from users. These include contact information such as email and mailing addresses, device information such as IP addresses, device type and model, and other information submitted through its web portal including task responses.
The data may be collected through the usage of technologies such as cookies, analytics tags and server logs among others, which is also used to optimise the portal.
This may seem like a lot, but GovTech assures that it will only share these insights with trusted partner government agencies and will be stored securely.
Featured Image Credit: Smart Nation Singapore
Also Read: How GovTech built an e-wallet that lets S’poreans instantly access gov’t payouts via ATMs, apps
