(FOR PRINT) Cash still king during Aidilfitri, but e-duit Raya gaining ground


 

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.


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," he 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.


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.

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