Speech by Governor Muhammad bin Ibrahim, FCB at the Karnival Kewangan SarawakSpeaker: Governor Muhammad bin Ibrahim, FCB Venue: CityOne Megamall, Kuching Language: Bahasa Malaysia Speech Date: 24 Nov 2017
Welcome to the Launch of Karnival Kewangan Sarawak. This Karnival is the result of the initiative and close collaboration between various ministries, agencies and financial institutions. I would like to express my deep appreciation to the Honourable Chief Minister of Sarawak for attending and officially launching Karnival Kewangan Sarawak.
My remarks today will focus on three key areas, namely the importance of innovation in economic and financial sector development; access to inclusive finance to ensure that the public is able to obtain high quality financial services; and the importance of inculcating a knowledge based culture to improve financial literacy among the rakyat.
Importance of Innovation to Drive the Development of the Economy and Financial Sector in Sarawak
Sarawak is the third largest state in Malaysia, contributing to 10% of the national Gross Domestic Product (GDP) with the economic growth of the state expected to be sustained. The ‘Digital Sarawak’ initiative by the State Government will encourage innovation in line with the incoming digital age developments. The mobile application Sarawak Pay, that was launched recently, will also transform the e-payment system landscape in the state. This application will allow the delivery of financial services to all districts to be more efficient and effective.
A new initiative, “Perlindungan Tenang”, will be launched today. Insurance products that bear this logo will offer insurance plans that are affordable, easily understood and with a simple claims process. These products are designed to meet the needs of low-income households that are still not able to afford any insurance and Takaful protection. It is also targeted at the eight million working Malaysians and 700,000 micro-enterprises, potentially raising the coverage of insurance and Takaful in the country. In addition to that, these products will be marketed innovatively and widely through various channels, including mobile phones and the internet.
An inclusive financial sector to ensure that the rakyat benefits from high quality financial services
One of Bank Negara Malaysia’s focus is to ensure financial inclusion for all. Towards this, we are pleased that the delivery of financial services in Sarawak has widened to rural areas such as Telang Usan and Belaga. Our initiatives to ensure agent banks serve throughout the state will continue so that no segment of society will be left out of the financial services framework. The network of agent banks in Sarawak has increased to 632 agents from only 14 agents in 2012. Currently, basic banking services are available in almost 97% of districts and to 99.7% of people in the state.
The late Chief Minister of Sarawak, Pehin Sri Datuk Patinggi Tan Sri (Dr) Haji Adenan Haji Satem once said, “We’ve tried our best to bring development to the rural areas but it’s not enough. We will do more.” To support this aspiration, strategic cooperation between relevant parties has been established to launch Mini Karnival Kewangan programmes in areas that do not have adequate access to financial services. The effectiveness of these Mini Karnival Kewangan programmes in rural areas have paved the way for improvements in the provision of quality financial services to meet the needs of the local community, such as additional ATM machines and mobile counters via customer service coaches.
To widen the access to insurance services in Sarawak in a more integrated manner, I am pleased to announce that Persatuan Insurans Am Malaysia (PIAM) and the Life Insurance Association of Malaysia (LIAM) will formally establish their respective chapters in Sarawak.
I would also like to touch on the issue of affordable housing. The approval rate for housing loans in Sarawak is among the highest in Malaysia, that is about 75%, and mainly for first home purchases. Indeed, financial institutions have been carrying out their social responsibility effectively to help the rakyat own affordable homes.
It is critical for all parties to work together to solve the issue of affordable housing. Housing developers can assist by providing facilities for affordable home buyers such as home deposit payment services, financial guarantees and disseminating information on the location of available affordable houses across the country.
In addition to that, Bank Negara Malaysia supports the Government’s initiatives to enact the Residential Rental Act, announced at the recent 2018 Budget speech, to safeguard the rights of tenants and landlords. We are also working with Cagamas to increase the supply of houses for rent through innovative financing models for both tenants and developers.
Knowledge based culture and financial literacy among the rakyat
Inculcating a knowledge based culture to build financial literacy is the shared responsibility of consumers and the financial industry. With the necessary knowledge on financial management, we will be able to understand the risks and returns associated with financial products; practise long term sound financial planning and avoid falling victims to financial scams.
To support financial literacy, Bank Negara Malaysia is collaborating with various parties to establish the Financial Education Network. A national level strategy will be formulated to improve financial literacy and the financial well-being of the rakyat. This national strategy will be targeted at all levels of society, from children to adults. A website will also be developed for people to obtain high quality information on financial education.
Initiatives to raise the level of financial literacy among the rakyat will continue to be conducted in an integrated manner. For example, the “Train the Trainer” programme in collaboration with and under the supervision of the Chief Minister of Sarawak’s Office, has trained counselors from 156 agencies. The benefits of this programme are manifold and will contribute to raising the level of financial literacy in the state.
Bank Negara Malaysia places great emphasis on the development of human capital in the country. Every year, we award scholarships to students to pursue their studies at top universities. This year we have focused on awarding scholarships to those from lower income households.
High quality human capital will help to elevate the performance of any organisation and contribute to the country’s development. In line with this, I am pleased to announce that we will be awarding two scholarships to staff of the State Government planning agencies to further their postgraduate studies abroad.
On a concluding note, on behalf of Bank Negara Malaysia and all involved in this Karnival, I would like to convey my appreciation to all involved for their hard work in making this carnival a success. I would also like all present here to benefit by visiting the participating booths and taking part in the activities which have been designed specifically for the people of Sarawak. I hope that this Karnival will have a positive impact on the people of Sarawak by enhancing their knowledge and skills on financial management. This will be the starting point in building a financially literate society, and if implemented wisely, will change our lives by leading us to greater prosperity.
© Bank Negara Malaysia, 2017. All rights reserved.