Malaysia's e-commerce market to grow by 12.8% in 2024

Alternative payment methods accounted for 35.7% of e-commerce transactions in 2023.

The Malaysia e-commerce market is expected to grow by 12.8% in 2024, driven by increasing consumer preference for online shopping, according to GlobalData.

In 2023, the market grew by 15%, reaching $9.8b (MYR44.6b). It is projected to reach $11b (MYR50.3b) in 2024.

Poornima Chinta, senior banking and payments analyst at GlobalData, said that Malaysia's e-commerce growth is supported by rising internet and smartphone usage, secure online payment systems, and events like Black Friday and Single's Day.

Alternative payment methods accounted for 35.7% of e-commerce transactions in 2023, as per GlobalData's 2023 Financial Services Consumer Survey. Grab Pay and ShopeePay are the top choices, along with global brands like PayPal and Apple Pay.

The surge in alternative payments can also be attributed to the growing popularity of buy now, pay later (BNPL) solutions. 

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Moreover, payment cards and bank transfers also continue to be widely used in e-commerce transactions. Cards accounted for 24.9% of the e-commerce transaction value in 2023, with credit cards being more preferred over debit cards due to the added benefits they offer such as interest-free installment payment options, reward programs, cashback, and discounts.

Despite the digital payment revolution, over 14% of e-commerce purchases in Malaysia are still made using cash, indicating the enduring preference for cash transactions among Malaysian consumers.

“With the rise in consumer preference for online shopping, improved payment infrastructure, and proliferation of payment tools, the future of e-commerce in Malaysia looks promising,” the report said.