Financial Industry

Financial Industry 

The financial services, accounting for nearly 12% of Malaysia GDP, continues to play an important role in driving Malaysia’s economic growth, both as strategic sector as well as a mobiliser of funds for investment. Over the next 10 years, the finance and insurance sector is expected to continue its strong growth of 8.3% and to continue an estimated 13% of GDP.

Leveraging on Malaysia’s strength in the Financial Services and its strategic location that straddles between two international financial hub of Singapore and Kuala Lumpur, The Federal and state government Johor and private sector are in collaboration to accelerate and transform Iskandar Malaysia into a Financial Shared Services Outsourcing (FSSO) in the region.

With the world finance restructuring and reshaping and continuous challenges in the global financial services industry, there will be more consolidation of financial institutions, stringent credit policies and greater market trading supervision around the globe. There are trend of growing usage of online banking and investment online in Asia Pacific. Higher education, higher income and appetite for higher risk and diversified range of financial products also create a need for financial advisor assistant in wealth and financial products in the region. Foreign financial institutions are also tapping into opportunities and growing wealth individuals in the emerging countries.

Globally, Islamic finance has been making strong inroads into the mainstream financial markets, growing at around 20% on average annually over the last 10 years. Rising financial markets awareness of Islamic financial products, national government initiatives and oil wealth have transformed Islamic finance into an industry of USD1 trillion in assets globally. In the next 10 years, the global Islamic financial services is expected to quadruple to USD4 trillion.

The Iskandar Malaysia financial services is identified and segmented into two major categories, namely the core financial products and the ancillary services related to financial institutions as following:

1. Financial Shared Services and Outsourcing

• Business process operations
• Back-office operations
• Call centre
• ICT support or data center
• Wealth management
• Human resource management
• Processing and administrative support activities

2. Islamic banking and finance

• Retail banking and wholesale banking
• Asset management
• Takaful and retakaful
• Capital market

3. Financial and other professional services

• Accounting and auditing
• Tax consultancy
• Legal consultancy
• Market research
• Management services
• Advisory services
• Corporate secretarial services

4. Offshore financial services

• Offshore companies
• Operational headquarters
• Incubators

5. Knowledge development and research hub

• Higher learning institution
• Collaboration between financial institutions and regulators

There are many catalysts project, policies and infrastructure being built and done to provide the ideal environment for investors to invest in financial services Iskandar Malaysia as following:

1. Comprehensive: Integrated financial infrastructure

The development of Islamic finance in Malaysia has been supported by comprehensive regulatory framework and human capital development programme.

2. Capabilities: World-class workforce at affordable cost

Availability of multi-lingual and quality workforce at affordable cost with several local and foreign higher learning institutions including Islamic finance studies catering to financial services industry needs.

3. Cost competitiveness: Affordable price

Affordable price from experienced talent pool, available real estate (ample land and building like Medini Business District, MSC Malaysia Cybercity and MSC Malaysia Cybercentre) and cost-effective facilities and amenities.

4. Catchment: Gateway to Asia and Middle East markets

Being in the center of large Muslim nations (Indonesia, west Asia), Malaysia enjoy market proximity to major Islamic financial institutions and Shariah investors.

5. Connectivity: World class and integrated network

World-class infrastructure with excellent multi-modal connectivity linking two international airports, four international seaports, integrated rail and road networks, and ICT-high speed broadband highways supporting fast connectivity to global markets.

6. Conducive environment: Dynamic and stable

Aside from stable government, resilient economy, easy and competitive place for doing business, the Financial Services sector has strong government support, with various fiscal and non-fiscal incentives.

Financial Industry Malaysia