PETALING JAYA: Axiata Group Bhd, the parent company of Boost, remains optimistic about the upcoming Boost-RHB digital bank launch and highlights that significant groundwork has already been accomplished.
Axiata CEO and managing director Vivek Sood said the necessary board members have been appointed, the management team is largely in place, and the implementation of the IT platform is currently under way.
“We’ve also carried out the operational review, which is what needs to be vetted out by the central bank phase one, to be submitted to the (central) bank. We have a pipeline of when we start the first product launch ... and that is expected by the end of this year.
“We do not see any hurdles as of now. But since this whole process of launching, the bank requires a thorough review done by the central bank and approval from them, we have to work closely with BNM (Bank Negara Malaysia) to get those approvals in place,” he told a virtual media briefing after the group’s AGM last Friday.
In addition, he emphasised the robust security measures implemented in the digital bank platform, encompassing privacy protection, defence against data breaches, and cybersecurity.
“Not only that, the operational review, which is done by the third party as well as further review done by the central bank would take into consideration whether the platform is adequately secure, and the central bank will give approval only once they’re satisfied that it is in place,” he added.
Confirming that the Boost-RHB digital bank remains on track for a year-end launch, Vivek stated that Boost’s exceptional performance in customer acquisition and robust loan book preparation positions it favourably in the digital banking space. He also expressed the group’s confidence in effectively managing the launch and operation of the digital bank.
“We are very optimistic and the reason why we are optimistic of the outcomes on digital bank is coming from the fact that there are a lot of things which we have already done, which is to be translated into the (digital) bank. For example, we’ve already done around one and a half billion loans to MSME and SME within our existing business, within Boost Credit.
“We’ve also acquired a large number of customers, 10 million, with around half a million of active customers on a monthly basis, which could potentially be the customers of (the) digital bank from day one. So we are very optimistic about this. But we are currently in the process of preparing our plans and will require the necessary approvals from the Central Bank before we can proceed with the launch,” he said.
Vivek revealed that the initial capital commitments for the digital bank amount to RM100 million, with its capital commitment at RM60 million.
“The target is to make it profitable over the next three to four years. And large part of the product offering would include deposits for the Casa account holders, as well as credits of different forms, insurance products, and other financial products, which we will launch one by one,” he said.
As announced by BNM in April 2022, Axiata’s fintech arm, the consortium of Boost, and RHB Bank Bhd appeared as one of the successful applicants for the digital bank licence.
During the briefing, Axiata also expressed interest in participating in Malaysia’s second 5G network through its associate CelcomDigi Bhd. The group said it welcomes further discussions with the government to refine the details and contribute to the implementation of the network.
