THE days of tapping a debit card on a point-of-sale (POS) device to pay for a glass of teh tarik or a newspaper are drawing closer as Bank Negara Malaysia unveils details of its roadmap for Malaysia’s migration to e-payments.

Next year will see 50,000 POS terminals deployed among the targeted lower-tier merchants to enable customers to make payments using debit cards.

The move is part of a plan that will see the banking industry deploy 570,000 new POS terminals nationwide between 2015 and 2020 (50,000 in 2015; 50,000 in 2016; 100,000 in 2017; 130,000 in 2018; 130,000 in 2019; and 110,000 in 2020).

“The idea is to widen the acceptance of debit cards among consumers. We will conduct promotional activities to boost debit card use to 89 million transactions in 2015, compared with 65 million transactions this year,” said Bank Negara Malaysia deputy governor Datuk Muhammad Ibrahim at the “Payment System Forum & Exhibition 2014”, here, yesterday.

Malaysia’s cash use is high, he said, adding that cash-in-circulation over gross domestic product stood at six per cent last year, compared with between two and four per cent in advanced countries.

Therefore, Malaysia needs to make huge improvements in reducing the nation’s dependency on cash and cheque use, and accelerate adoption of e-payments.

Muhammad said debit card transactions should hit one billion by 2020 under Bank Negara’s five-year Payment Card Reform Framework.

He said the banking industry would benefit from reduction in cost of handling and managing cash, especially as the sector incurs an estimated RM1.8 billion a year in cost for related services, while businesses incur RM2.7 billion in estimated cost annually for cash handling.

AmBank senior vice-president and AmCard services chief executive officer Perry Ong said Malaysia was ideally poised to embrace the culture of making payments via debit cards as each of the 45 million ATM cardholders basically already hold one in his hand.

He said local banks had been issuing ATM cards with debit components to enable them to function as debit cards. On the issue of card security, Muhammad said local payment cards have been chip-based since 2005, when Malaysia implemented an industry-wide migration from the less secure magnetic stripe cards.

As a result, Malaysia’s fraud losses were only 0.01 per cent of the total transaction value, he added.

Meanwhile, e-payments are gaining wider traction with online banking having secured 17 million subscribers.

“To promote infrastructure sharing and reduce cost and enhance online bill payment facilities in Malaysia, there is a Malaysian Electronic Clearing Corporation Sdn Bhd (MyClear) initiative to develop a national bill payment scheme known as JomPAY,” Muhammad said.

He added that customers could use their bank’s online channel to make bill payments but only to those merchants who maintain banking ties with the same bank.