Credit card crunch? Study shows Malaysians turning away

KUALA LUMPUR - A survey conducted by a digital payment platform has revealed a 9.0 per cent decline in credit card usage among platform users, signifying a shift from conventional credit options.

The survey was conducted by SeaMoney, part of the Sea Group, with 25,000 active users to gain insights into the role of Buy Now Pay Later solution SPayLater as an alternative financial solution.

SPayLater gives users payment flexibility by making immediate purchases with flexible payment plans, a statement said today.

The SPayLater 2023 1Q survey also revealed a 47 per cent drop in borrowing from friends and family, which suggests a potential adoption of buy now pay later (BNPL) services like SPayLater.

Additionally, the survey also revealed a 43 per cent fall at pawn shops and a 20 per cent drop in seeking authorised money lenders.

ShopeePay and SeaMoney, Malaysia head Alain Yee said different income group benefits from BNPL service.

Shopee is part of the Sea group.

"Low to mid-range earners, for instance, use BNPL for indulgences or planned purchases, while the middle class values its flexibility in managing unforeseen expenses.

"Higher-income users explore alternative financial avenues without compromising their credit. This diverse usage leads us to understand the prevalent financial habits among Malaysians,” Yee said in the statement.

Citing survey findings, the statement said the decline in personal borrowing reflects a shift from less regulated financial assistance.

Meanwhile, up to 88.2 per cent are satisfied with the BNPL solution SPayLater and 81.9 per cent are willing to recommend the service to others.

Additionally, 24.5 per cent said the primary reason for using the service is due to the ease of SPayLater's application process. - BERNAMA