Google Malaysia forecasts that Malaysia’s internet economy to grow to RM109 billion (USD 26 billion) by 2025 from RM 46 billion (USD11 billion) this year. E-commerce and online travel are expected to spearhead the digital grow, followed by digital media and ride-hailing sectors.
Mr. Marc Woo, Country Head of Google Malaysia, gave his keynote address today at the Malaysia Ecommerce Day 2019, Kuala Lumpur, an event produced by the Malaysia Digital Economy Corporation Sdn Bhd (MDEC), a Malaysian government agency responsible for promoting the technology and digital industry in Malaysia.
Malaysia Mobile Internet High Engagement Rate
Malaysia is ranked the fourth most engaged mobile internet users in the world, behind only Thailand, the Philippines, and Indonesia. Malaysians spend at least 4.02 hours per day on their mobile phones.
This contrasts greatly to Singapore and the US, which ranked 9th and 10th most engaged mobile internet users. Users in these two countries spend only 2.58 minutes and 2.24 minutes per day on their mobile phones.
Malaysia’s Non-Urban Internet Economy Is Growing
Outside of Malaysia’s Klang Valley, the most urbanized area in Malaysia, the internet economy is expected to grow further. The Malaysia urban internet economy is estimated at USD 681 million versus only USD 227 million in non-metro areas, this year.
This represents the smallest urban-rural gap in South-East Asia, where neighboring countries rural internet economy are much smaller by comparison.
Higher User Engagement Leads To Higher Revenues
Essentially, the more time spent on mobile apps, whether ecommerce apps, or ride-hailing apps, the more money are spent. This is true across all countries in South East Asia.
Insufficient Access To Financial Services
Even though Malaysia has one of the highest rates of banked population (individuals with bank accounts), when compared to its neighbors, a large number of its population still lacks access to other financial services. These other financial services include credit facilities, insurance, and investment platforms.
Opportunities Abound For SMEs
According to the presentation by Google, 98.5 percent of business establishments are SMEs (small and medium-size enterprises) which employ 66 percent of the population and contribute to 37% of the GDP.
What this means is that SMEs are in the right position to make use of this growing digital economy, especially in the areas of e-commerce and online travel, where its expected to grow to RM110 billion and 98 billion respectively, by the year 2025.