INTERACTIVE: Cash still king during Aidilfitri, but e-duit Raya gaining ground (Poll Inside)

 
Proposed blurb: Will technology reinvent Malaysia’s Aidilfitri duit raya tradition? We find out.

 

By SHYAFIQ DZULKIFLI

 

PETALING JAYA: Physical banknotes are the preferred choice for many Muslims in Malaysia when it comes to giving duit raya, but online cash transfers are gaining ground as an alternative. 

 

 

The custom of handing out packets containing money as gifts to family and other loved ones especially children during Aidilfitri is seen a way to strengthen ties and ease the burden of the needy. 

 

 

Rafiqha Mustaffa, 32, is among those who still prefer the traditional method of giving out duit raya in the form of physical banknotes. 

 

 

"I give my children duit raya in cash for sentimental reasons. 

 

 

“I remember feeling happy when I received the cash in my hand, so I want my children and other children to experience the same,” said the mother of two. 

 

Rafiqha prefers to give duit raya in cash

 

 

Others, such as Ashikin Azhar, prefers cashless transactions for its convenience. 

 

 

"Digital money transfer is very appealing to me as it is easier and immediate, and nowadays there are many banks and financial institutions that offer e-duit raya transfers," she said. 

 

 

Ashikin, who works as a sales manager, said money transfers can be accompanied by digital greetings or personalised messages which add a personal touch to the tradition. 

 

Ashikin: E-money is easier and convenient.

 

 

 

 

 

Bank Negara Malaysia (BNM) statistics show a notable rise in both the circulation of physical banknotes as well as electronic money (e-money) transactions during Ramadan and Aidilfitri each year. 

 

 

Physical banknotes still popular 

 

 

For example, in March last year which was when Ramadan was observed, the circulation of RM1 notes rose by 7.25% month-on-month to RM3.34bil. 

 

 

The figure went up further to RM3.46 billion in April, which was when Aidilfitri was celebrated. 

 

 

The circulation of RM5 notes meanwhile grew by 7.51% in March to RM3.33 billion and to RM3.44 billion in April. 

 

 

Among the ringgit’s various denominations, the RM1 and RM5 notes recorded the biggest increase in the number of banknotes in circulation during Ramadan and Aidilfitri.

 

 

 

 

A gradual digital shift  

 

 

The central bank’s payment statistics also show a significant year-on-year increase in electronic money (e-money) transactions. 

 

 

Last year's transaction value of the e-money stood at RM106.7 billion with a total of 4.02 billion transactions. 

 

 

The value of e-money transactions – comprising fund transfers and mobile remittances - went up nearly 50% from the RM71.18bil in 2022. 

 

 

According to BNM's Annual Report 2023, 59% of e-money transactions stemmed from e-wallet usage and the remainder from card-based e-money.

 

 

 

 

 

 

Amid the overall increase over the past few years in e-money transactions, BNM’s figures reveal a spike during Aidilfitri.

 

 

Last year’s month-long Aidilfitri celebration from April to May for example showed a clear uptick, with the volume of e-money transactions rising 10.4% month-on-month in May to 331.9 million transactions.

 

 

The value of transactions meanwhile went up by 7.47% in May to RM8.35 billion.

 

 

Fintech company TNG Digital Sdn Bhd (TNGD) said it expects its cashless convenience and seamless payment features to give its Money Packet transactions a boost this year.

 

 

TNG is expecting a 250% increase in total Money Packet value sent and claimed by users.  



Money Packet is a feature on TNGD’s app that allows users to transfer credit to friends and family, up to 100 people either in random or equal value.  

 

 

The company said to that it was expecting a 40% increase in total Money Packet users and a 180% increase in the total quantity of Money Packet created.

 

 

In 2023, TNGD introduced an “equal distribution” option in the TNG eWallet Money Packet feature, just before Raya.

 

 

This option allows users to send an equal amount in money packets to friends and relatives.

 

 

“We then observed a close to 41% increase in the daily number of Money Packet creators.

 

 

 “Throughout the festive season last year, we accumulated almost one million Money Packet users,” the company said.

 

 

Based on data from last year, TNGD said more than 80% of users who engaged in sending TNG eWallet Money Packet as e-duit raya were Malays, and among them, 70% were existing loyal users.

 

 

TNGD said the current trend was consistent with its effort to help minimise waste and tackle challenges that arise due to limited access to new banknotes and banking services in certain areas.

 

 

“However, it is important to note that this digital trend may not entirely replace the traditional practices.

 

 

 “We want to make the act of giving and receiving e-duit raya more delightful and interesting for all users involved,” it said.

 

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