2023 is projected to be volatile for the economy – both global and Malaysian. Both the World Bank and the International Monetary Fund (IMF) predict an economic storm cloud to hit. Their chorus is joined by the World Trade Organisation (WTO) and the World Economic Forum (WEF). Geopolitical conflicts, the cost-of-living crisis stemming from persistent and broadening inflation pressures, China’s economic slowdown, and fluctuating commodities contribute to this storm. However, in the words of Sun Tzu, “In the midst of chaos, there is also opportunity.” Financial Technology (FinTech) companies play a crucial role as they provide creative solutions to the financial services sector. Technological and solutions innovations driven by FinTech would help fill some gaps. Here are five trends and innovations to look out for in 2023.


Virtual cards

Virtual cards are digitally designed for one-day use while masking the numbers of an actual card. When consumers use a virtual card, the retailer can only access and store the information of the temporary card, which protects their actual card information in the event of a data breach. The simplest way to envision a virtual card is by imagining your credit or debit card without its physical form. Depending on the provider, what distinguishes virtual cards from their physical counterparts is they can generate a unique card number for each transaction. There are some virtual cards available to consumers. Businesses too, have access to this facility to manage their cash flow and line of credit.


Buy Now Pay Later 2.0

Buy Now Pay Later (BNPL) is a form of short-term financing which enables consumers to make purchases and pay for them at a later date with little or no interest. BNPL is also known as “point of sale instalment loans”. Evolving since it was first introduced in 2012. According to Deloitte, BNPL experienced exponential growth between 2018 – 2021. Today, BNPL has evolved into “Live Now, Pay Later”.


Contactless Wearables

It started with the rise of mobile payment options such as Apple Pay, Samsung Pay, and Google Pay as well as the development of magnetic secure transmission (MST) and near-field communication (NFC) technologies. Banks and card providers are slowly enabling their cards to connect with these mobile payment options. At the same time, gadget makers are integrating the same technology into their wearables. Apple Pay is integrated into the Apple Watch. Samsung Pay with their Galaxy Watch and Galaxy Watch Active. Android Wear watches are connected with Google pay. As these wearables become affordable, their accessibility and adoption are expected to increase.



RegTech, or regulatory technology, is a key sector in fintech that ensures regulatory compliance. This tech encompasses comprehensive monitoring, reporting and data analysis, and compliance features. RegTech enables businesses, especially those in the financial and fintech industries, to better manage their regulatory processes using technology. This technology results in the better curtailing of money laundering activities, real-time monitoring of irregularities in digital payments, and management.


Alternative Financing

Alternative financing refers to business funding offered by nonbank institutions. This includes financing offered by SME digital financing platforms like Funding Societies. One form of financing offered by fintech companies is trade financing where businesses can use outstanding invoices as collateral to obtain financing. Another option is “invoice factoring” where businesses sell their outstanding invoices at a discount in exchange for immediate cash. Another form of alternative financing is revenue-based financing (RBF). It is a non-loan funding option where businesses repay the funding with a percentage of their monthly revenue (instead of using fixed instalments with fixed schedules). These concepts and practices aren’t new; they just found popularity in the recent e-commerce and startup boom. 

These five trends are not exhaustive. As new challenges arise, the FinTech industry will need to come up and address them. We will see technology applied differently. What we can anticipate is that fintech will enter unknown territories.