KUALA LUMPUR: KAF Digital Bank expects it could take between five and 10 years to break even, in line with digital banks worldwide, according to founding CEO Rafiza Ghazali.
“Globally, if you can break even in five years, that’s already considered very good. The majority take between seven and 10 years. It depends on whether you are more prudent or more aggressive in your early years,” she told reporters on the sidelines of the RinggitPlus Malaysian Financial Literacy Survey 2025 today.
Rafiza said the lender, the newest of Malaysia’s five licensed digital banks to go live, is still too early in its journey to disclose performance metrics.
“We just launched, so it’s still a very, very early stage. I can’t really comment on how we have so far. Just give us a couple of months and we can share a little bit more. From what we see with other countries, your first six months of progress doesn’t mean much.”
She added that initial deposit figures are not necessarily representative of long-term growth. “Especially in the first month, it’s not always the true picture of how it is.”
Rafiza’s remarks came after Maybank Investment Bank on Sept 30 noted that deposits across Malaysia’s digital banks remain very small compared with traditional banks.
Analysts said this is expected, as digital banks typically need time to build customer trust, roll out products and gain market share in a crowded financial landscape dominated by established players.
Rafiza noted that digital banks, which operate without physical branches, were introduced in Malaysia to widen financial inclusion, particularly for underserved and unbanked segments.
“Bank Negara is pushing for financial inclusion. The underserved may find it difficult to get even basic banking services from a traditional bank. So I think that’s really the main objective of Bank Negara,” she said.
According to RinggitPlus’s 2025 Malaysian Financial Literacy Survey (RMFLS), this year’s findings paint a mixed picture of progress: lower-income and Gen Z Malaysians are making financial strides, while middle-income Malaysians face growing challenges, despite broader improvements in retirement planning, credit awareness, and digital money management.
Ringgitplus CEO Yuen Tuck Siew said 55% of those earning below RM2,000 a month say they have started planning for retirement, up from 48% in 2024.
“Financial literacy is also improving: fewer lower-income Malaysians say they are unfamiliar with credit scores (40%, down from 45% last year), suggesting greater awareness of how credit impacts financial wellbeing.”
However, he said 36% of lower-income respondents say they actively avoid using Buy Now, Pay Later services, the highest among all income segments. “In contrast, middle-income Malaysians, particularly those earning between RM5,000 and RM10,000 a month, are seeing their savings power erode.”
Yuen said they are the only income group to report a decline in savings, with only 23% managing to save between RM1,001 and RM1,500 a month, compared to 29% in 2024. “Meanwhile, the share of this segment saving less than RM500 monthly rose to 39% from 31% in 2024.”
In addition, he said rising insurance costs are already having a significant impact on Malaysians across the board.
“22% of policyholders have either switched to a cheaper plan or cancelled at least one policy in the past year due to affordability concerns, a trend most prevalent among lower-income Malaysians.”
Despite individual efforts to plan for the future, Yuen said, 43% of Malaysians remain without medical insurance, while 15% rely solely on company-issued medical cards.
“Meanwhile, less than half (48%) report having a life insurance or Takaful policy, suggesting that financial protection continues to be deprioritised amid other cost pressures.”