Welcome to Malaysians on Malaysia: Our quarterly report on Malaysian Consumer Confidence Index (MYCI). Malaysia has the highest MYCI since pandemic and causes an uplift in overall MYCI components too! Oppotus also covered essential insights into consumer confidence, behaviour, e-wallet, tech, crypto and E-sports trends.
Now that mask-wearing is no longer mandatory, and movement control restrictions long gone, Malaysians are beginning to look forwards to a Covid-free nation. We see a different lifestyle that we have adapted into this “New Normal”. Our MYCI study gives us a glimpse of the trends and sentiments. This time focusing on how consumer confidence helped to improve the overall MYCI components. Our previous coverage on Malaysian consumer confidence for 2Q’2022 can be found here.
Our MYCI Is At A High Since COVID-19
The announcement on non-mandatory guidelines for mask-wearing in selected indoor areas, coupled with further relaxations for international traveling; has helped to achieve the highest MYCI at 120-points since pandemic 2 years ago. All components of our MYCI are showing signs of improvement suggesting that many have expectations of better things to come. As businesses from all sectors are back to work in offices, it brings a sense of confidence and stability towards the economy growth once again.
Malaysian Have Positive Financial Sentiments
As Malaysians are returning to the working world, people are feeling confident with their future financial well-being. With the unemployment rate continuing to decline, the index hit almost 140-points in 3Q’2022. Inline with this optimism, people tended to shop more. Hence, the spend on major purchases’ index is striking an all-time high of 130-points. Another reason is that the recent Home Expos held have also affected consumers to make major purchases further.
Malaysian Remain Subdued Towards The Economy
In the light of mask-free in some indoor areas along with lifted travel restrictions, it has boosted Malaysians’ confidence towards the current state of economy. Hence, the indices see a gradual improvement since the beginning of 2022. However, considering the weakening of Malaysian Ringgit, the increase in inflation rates, and talks of Budget 2023 looming around during the data collection period; Malaysians remain cautious about the future of our economy.
Usage of E-Wallet Dipped
After reaching a mass adoption level in the last 4 quarters, usage of e-wallets recorded a dip. Malaysians are now less cautious with using “touch-less” these days. Hence, the average spends on e-wallets recorded 6% drop in 3Q’2022. Even though the top 3 channels of e-wallets being used remained to be Groceries, F&B, and Convenience Stores; their usage levels see decline as well. With more and more convenient payment methods available in the market, the average number of e-wallet that consumer uses, dropped to 3 e-wallet brands per user. This could also be resulting of the reason that cash is still by far the most used payment method in Malaysia.
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With the recent announcement from the Malaysia government that wearing of mask is no longer compulsory in most indoor places, and further relaxation with regards to international travelling; our MYCI soars to a 120-point mark in 3Q’2022 – highest MYCI since Covid-19 pandemic two years ago. At the same time, job opportunities continue to soar as Malaysia sees an all-time low unemployment rate at 3.7% since the pandemic. All these events have indeed uplift Malaysians optimism – not only at an overall level but also across all MYCI components.
Malaysians’ positive perceptions towards their Current State of Financial Well-Being remained unchanged in 3Q’2022. With businesses from all industry are back to its workplace, Malaysia’s employment rate continues to improve this quarter. As a result of that, a decline in the unemployment rate help to increase employee earnings. Subsequently, this creates a Ripple Effect as it leads to a higher rate of consumer spending and helps to stimulate economic growth.
With Malaysians seize to be back in the working world, Malaysians are hopeful that their state of financial well-being will be much better off in the next 12 months (more so among consumers in Klang Valley). After a year of hovering around 120+-points mark, Malaysians confidence level towards their Future Financial Well-Being rose to almost 140-points mark in 3Q’2022 – as Malaysians returned to their working life (as unemployment rate continues to decline).
Looks like Malaysians are having a good time shopping this quarter! The optimism Malaysians have about their future financial well-being is reflected in their willingness to Spend on Major Purchases. The index is making its mark with an all-time high score of 130-points mark since 2018. The recent Home Expos around town could be the reason why it is so. This drives the intention to make these major purchases further – especially among the T20s.
Throughout 2 years of the COVID-19 period, Malaysians’ confidence in the State of The Economy sees a gradual improvement since 1Q’2022. Inline with the hopefulness of Malaysians on their well-being, the index now rose to be above the 100-point mark in 3Q’2022 (108-points). The recent announcement on the non-mandatory of mask-wearing in some indoor areas coupled with the further lifting of international travel restrictions has somehow boosted Malaysians’ confidence that we are finally moving ahead of the pandemic.
Despite the positive-ness towards the current state of the country’s economy; however, Malaysians remain skeptical about the Future of The Economy In The Next 12-Months. During the data collection period, news about the Malaysia’s 2023 Budget, weakening of Malaysian Ringgit (MYR), and increased inflation rate are looming around. This may have left Malaysians feeling uncertain of what to expect when it comes to the economic side of things.
Although shopping online is less time-consuming and convenient; people still prefer to see, experience, and test products in person before making any purchases. With the government lifted movement control restrictions, Malaysians are now able to shop physically in stores; which causes a drop in making online purchases. Therefore, it contributes to one of the reasons why e-wallet usage has a noticeable decline.
Ordering food online has been the best option when people crave for food during the pandemic. Consumers are allowed to enjoy a variety of food from different restaurants without stepping out of their homes. However, people are now allowed to dine out as movement control restrictions are lifted. Malaysians are ready to be out for food hunting again. Consequently, food delivery rate recorded a dip. The frequency of people purchasing takeaway or having meals at convenience stores / petrol marts increases too.
As Malaysia’s public holidays are lesser this quarter, local and international travel rates reduced. However, we assume that the travel rates will be back to normal as holiday season is coming in December. Several good news related to Malaysia’s tourism industry were announced during this quarter. For instance, Thai Government will continue its cooperation with Tourism Malaysia to boost the industry, etc.
E-wallet Usage in Malaysia recorded a dip to 55% (a 17% drop vs 2Q’2022). Inline with the decline in usage, the overall spend using e-wallets also recorded a drop to RM244.59 per month (-6%). The current trend is similar to the times when Malaysians are up and about after major Covid-19 lockdowns. Consumers are adopting different form of payment where cash is still by far the most used payment method; followed by e-wallet.
The frequency of people using e-wallets to make transactions reduced. This could be due to the various payment methods offered in the market, such as PayWave, individual payment systems, etc. With the convenience of such, it could have taken a toll on e-wallet usage. There’s no escape for the average amount of e-wallets used among Malaysians too, the number drops from 3-4 e-wallets last quarter to 3 e-wallet brands per user in 3Q’2022.
On a whole, Touch ‘n Go e-wallet continues to outrank other providers. However, it’s noticeable that its usage is heading towards a downward trend since 4Q’2021. It could be due to the overall dip in e-wallet usage. Unexpectedly, GrabPay recorded a massive drop and is at its all-time low; out of the Top 5 E-Wallet Used in Q3’2022. Maybank QRPay sees a spike in usage and is now at #2 from #3 last quarter.
It is also worth mentioning that Boost repositioned with a refreshed brand in September; hence, the e-wallet usage for Boost recorded a spike. With the constant promotional activities and rewards provided by Shopee, ShopeePay usage improved concurrently. While the usage of major players such as FavePay, CIMB QR Pay, and AliPay recorded a decline.
With the convenience provided by e-wallets, channel that accept e-wallet as one of the payment methods grow. Groceries, F&B, Convenience Stores, Mobile Reloads, and Bill Payments continue to be where e-wallets are mainly used for/at. However, the majority of the Usage of E-Wallet in Each Channel recorded a decline. This could be due to Malaysians still use cash as the most common payment method.
The main Tech Trends that Malaysians are attentive to in 3Q’2022 are Cryptocurrency (78%), E-sports (76%), and Artificial Intelligence (70%). However, Malaysians’ awareness towards majority of the tech trends recorded a drop once and again. The only trending technology that Malaysia has increased interest in is Fintech (+4%). “Digital achievement is crucial in Malaysia’s economy recovery,” says Prime Minister Datuk Seri Ismail Sabri Yaakob. Technology plays an important role in all aspects of our life, such as healthcare, communication, education, transportation, etc. It helps to improve and create a convenient and efficient lifestyle.
Malaysia’s Cryptocurrency Ownership sees an uptick in 3Q’2022 (37%), and it’s getting closer to its previous peak in 2Q’2021 (41%). Despite the news of recession in the US which caused a drop in users last quarter, there is some positive news for Malaysians this round. According to a recent press release, Kenanga Investment Bank Berhad (Malaysia’s largest independent investment bank) has partnered with Ant Group (an affiliate company of the Chinese conglomerate Alibaba Group). They plan to develop a wealth management app named “SuperApp”. It is expected to involve features like e-wallet, stock & crypto trading, FX, and digital investment management.
Other than that, Chainlink (LINK) and Uniswap (UNI) are the two cryptocurrency coins that were added to the list of approved digital assets in the country. Ever since the launch of these cryptocurrency coins in Malaysia, the nation has traded more than RM50 million worth of these digital assets on Luno. With all these positive information, the cryptocurrency adoption rate in Malaysia might continue to expand in the coming months.
Inline with the above, the Ownership of Each Type of Cryptocurrency increase simultaneously. PMEBs and the M40s have a strong interest towards Cryptocurrency. In addition, Malaysians who are from KL/PJ, Chinese, Business Owners, and T20 resonate more with Cryptocurrency as well. There are plenty of platforms and exchanges used to do trading. The top 3 platforms that are commonly used among Malaysians are Luno, and Huobi followed by eToro. To keep up with Cryptocurrency information, most of the owners constantly read up on news related to Cryptocurrency. The main channels that users usually go for are Word of Mouth (WoM) from friends, Telegram groups, and social media sites.
Note: Malaysians on Malaysia cover opinions of Malaysians aged 18 and above, M40 and T20 segments, in key cities of Peninsula Malaysia representatively.
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