BY JACINTHA JOLENE & ALEXANDRA LORNA
This is the concluding installment of a three-part series, featuring perspectives from an academic and BNPL provider as well as the significance of the passing of the Credit Consumer Bill 2025, which will change the consumer landscape.
THE usage of Buy Now, Pay Later (BNPL) is expected to continue increasing over the next few years, particularly among younger, digitally connected users.
Irving Ting, a lecturer from the Faculty of Business, Design and Arts, Swinburne University of Technology Sarawak, said convenience and instant approval make BNPL attractive, especially among young consumers and those without credit cards.
On top of that, the rise of online shopping, social media influence and peer pressure create a sense of urgency to buy now, even when funds are limited.
Adoption of BNPL among youths
He noted that BNPL, especially among Sarawak youths is steadily growing, especially among Gen Y and Gen Z, who are drawn to its ease and instant gratification.
While concerns about transparency and managing debt still linger, Ting said factors such as simplicity, habit formation and good internet access play a big role in driving its adoption.
In Sarawak, he said adoption of BNPL is rising but still trails urban regions like Klang Valley, where digital infrastructure and exposure are more advanced.
“Youth in Klang Valley lean heavier on social influence and convenience, while Sarawakians are more cautious. It’s less normalised here despite growing interest.
“I expect BNPL use in Sarawak to continue increasing over the next few years, particularly among younger, digitally connected users,” he told Sarawak Tribune.
Given the interest is growing yet understanding remains mixed, Ting said introducing tailored financial literacy initiatives and clearer regulation under frameworks like the Consumer Credit Act would be important to protect users and foster responsible use.
He added educational institutions should play a proactive role by integrating practical financial literacy modules into their programs, helping young people understand budgeting, interest and repayment responsibilities.
“These hubs could also partner with financial experts to hold workshops stressing responsible BNPL usage and avoiding debt pitfalls.”
The concerns surrounding BNPL adoption, particularly among inexperienced young borrowers, underscore the importance of stronger safeguards in the credit market.
Ting stressed that while education is key, structural protections are equally vital—an area that the recently passed Consumer Credit Bill 2025 seeks to address.
Passage of Consumer Credit Bill 2025
The Consumer Credit Bill 2025 was passed in the Dewan Rakyat in July, aiming to standardise the regulatory framework in the consumer credit landscape in the country.
Under the Consumer Credit Act 2025, the Consumer Credit Commission (CCC) will be established to regulate credit businesses that currently operate without a license or specific monitoring.
According to Ting, the passing of the Bill marks a watershed moment for consumer protection in Malaysia by finally regulating the previously unregulated shadow credit sector such as BNPL, micro-lending, debt collection and factoring.
“It signals the government’s commitment to fairer, safer credit practices and restores public confidence in financial services offered outside traditional banks,” he said.
With the establishment of CCC, Ting said it unifies multiple credit-related services under one modern consistent legal framework, filling major gaps in oversight, unlike past laws like the Hire-Purchase Act or Moneylenders Act which only covered narrow areas.
He said consumers will now will benefit from fair contract terms, clear disclosure of fees and interest rates, the ability to make early repayments without penalties and mandatory assessments to ensure they can afford the credit.
“Debt collection is also regulated. Harassment, threats or public shaming are outlawed and borrowers have formal channels for dispute resolution via CCC’s complaint platform,” he said.
Ting said the bill represents a milestone in promoting financial literacy and transparency, as it requires lenders to use clear, plain-language disclosures on charges and repayment terms before credit is granted.
“This empowers consumers to make informed choices. On top of that, the CCC is expected to collaborate with agencies like Credit Counselling and Debt Management Agency (AKPK) to provide financial education, while centralized credit reporting and better dispute mechanisms make the system more transparent,” he explained.
He noted that the bill would particularly benefit youths and low-income groups who are increasingly reliant on BNPL and other forms of easy credit.
“They will enjoy stronger safeguards such as affordability checks and fairer repayment terms, which reduces the risk of falling into spiraling debt. However, there is concern that higher regulatory costs could push up prices or limit access, potentially squeezing vulnerable users,” he cautioned.
Still, Ting stressed that while the bill advances responsible lending, it does not resolve the deeper causes of household debt in Malaysia.
“Stagnant wages, rising living costs, and income insecurity are the real pressures driving borrowing. Without broader reforms, legislation can only provide protection, not eliminate the financial stress many Malaysians endure,” he said.
Looking ahead, he suggested that future amendments could strengthen consumer protection further.
“Capping fees or interest in BNPL products, expanding public access to credit scores, and publishing blacklisted lender information would enhance transparency. It is also vital to ensure the CCC operates with independence, accountability, and clear governance to build trust and effective enforcement,” he added.
From a BNPL provider’s perspective
As regulators tighten oversight, industry players such as ShopeePay and Monee Capital Malaysia, providers of SPayLater (SPL), they are already prepared to comply with the Consumer Credit Bill
Chief executive officer of ShopeePay, Alain Yee, said for SPL, it has been consistently cooperating alongside the Consumer Credit Oversight Board Task Force (CCOBTF) since 2021 to ensure its operations meet best practices and prioritise consumer safety.
“CCOB also takes a proactive approach and routinely consults industry players in the lead up towards the Bill.
“Internally, we practice frequent self-assessments and regulatory readiness assessments, benchmarking our current standards to upcoming regulations,” Yee said.
He said the company has long implemented internal affordability assessments to prevent over-indebtedness, a practice now also mandated under the bill.
“From the start, we have used alternative data within the Shopee ecosystem, such as purchase history, spending frequency and repayment behaviour, to determine accurate credit limits for users,” he explained.
These limits are then adjusted over time based on usage patterns, a method Yee described as “safer and more intuitive than static or umbrella limits offered by other credit providers.”
He added that this approach not only safeguards consumers but also benefits underserved groups such as gig workers, small business owners and rural communities who often lack conventional financial documentation.
In cases of late repayment, Yee said accounts are frozen to prevent further debt accumulation, while a flat RM10 non-compounding fee is imposed to avoid overburdening users.
Merchants Shielded From Risk
For merchants, Yee stressed that all credit risk is absorbed by Monee Capital, meaning sellers receive their full revenue upfront. Refunds or disputes follow standard merchant procedures, while SPayLater manages repayment collection and late fees.
“We cannot speak for other providers, but for SPayLater, all credit risk is borne by ourselves (Monee Capital) as the BNPL provider.
“This means that SPayLater merchants will not suffer any risk to their income when consumers utilize SPayLater, as they will receive the full revenue of their sales upon completion of the transaction.
“In the case of a refund or failure to deliver goods, merchants will complete the process via their usual refund/replacement procedures,” Yee said.
No Impact on Merchant Fees or Payouts
Yee clarified that the bill will not affect merchant payouts, fees or service terms, as the regulations are directed solely at BNPL providers and not the merchants who offer BNPL as a payment option.
“Merchants have no ability to alter or adjust SPayLater’s terms. All fees, conditions and repayments are managed entirely by us as the BNPL provider. This means compliance obligations fall on SPayLater, not the merchants,” he said.
On accessibility, Yee highlighted that SPayLater transactions can be made through the national DuitNow QR code system, which can be adopted by any registered business across Malaysia.
“Our survey found that more than 55 per cent of Malaysians still lack access to legitimate credit options, and many risk turning to unregulated sources in times of need. By enabling SPayLater through a nationally accessible channel like DuitNow, we open doors for merchants and consumers everywhere — from city centres to rural towns,” Yee said.
He added that the initiative aligns with SPayLater’s long-term goal of serving credit-underserved communities and gradually moving them out of grey or informal lending economies.
“Access to safe credit isn’t just important in urban areas. Non-urban Malaysians face the same urgent needs, if not more, and they deserve the same protection. That’s why we believe safer credit options must be available to all Malaysians, not just city folk,” Yee stressed.
Merchants Shielded from Credit Risks
Yee assured that merchants using SPayLater need not worry of any adverse effects to their earnings, as all credit risk and user repayments are managed by SPayLater and Monee Capital.
“However we still take communication and clarity of repayments seriously. We believe as financial providers, we hold a responsibility to be transparent and ensure users understand the commitment they are taking on.
“Nearing repayment dates, SPayLater will begin sending reminders and notifications to users from as early as 10 days before their upcoming billing cycle.
“To ensure the message reaches our users, we utilise multi-platform communication, including SMS, Whatsapp and Shopee/ShopeePay app notifications.
“Even before checking out, users are made aware of the payment plans made available to them along with the corresponding fees (currently we offer 0 per cent fees for 1-month and 3-month plans, and 1.5 per cent processing fees for 6-12 month plans).
“Over time, we’ve noticed this strategy paying off, as we see a consistent and steep decline in late payments since 2021, mirroring CCOBs recorded downtrend of late BNPL payments industry wide,” he said.
Expanding Access Nationwide
ShopeePay is also expanding accessibility by integrating with the DuitNow QR system, enabling even small rural businesses to accept BNPL payments.
A company survey found that 55% of Malaysians lack access to safe credit, underscoring the importance of legitimate credit options to reduce reliance on informal lenders.
“By embedding SPayLater into a nationally accessible payment system, we’re helping underserved communities transition towards secure, regulated solutions. We believe safer credit options must exist for all Malaysians, not just urban consumers,” Yee said.
