KUALA LUMPUR, 28 November 2025 – Visa Malaysia, a global leader in digital payments, has released findings from its latest whitepaper, From Transaction to Transformation: Unlocking Malaysian MSMEs’ Potential. The study identifies four critical pathways through which micro, small, and medium-sized enterprises (MSMEs) can accelerate growth via digitalisation: boosting productivity, strengthening cybersecurity, improving cash flow and capital management, and unlocking new revenue streams.
MSMEs form the backbone of Malaysia’s economy, representing 97% of all registered businesses, contributing 38% of GDP, and accounting for nearly half of national employment. As Malaysia advances towards its ambition of becoming a high-income, technology-driven nation by 2030, MSMEs are poised to play a pivotal role. National initiatives such as the Malaysia Digital Economy Blueprint, the national 4IR Policy, and the 13th Malaysia Plan have laid the groundwork for digital adoption. Visa’s study reveals that more than 80% of MSMEs are already taking steps to digitalise operations across finance, accounting, marketing, and sales.
Previn Pillay, Country Manager of Visa Malaysia, emphasised the urgency of this transformation.
“The success of Malaysia’s MSMEs is not only critical to the country’s economic resilience, but also to the vibrancy of ASEAN’s trade flows. In 2021, Malaysian street stalls and kiosks generated US$1.8 billion in retail sales, a figure projected to reach US$2.8 billion by 2026, growing at a compound annual rate of 8.8%. This momentum underscores that digitalisation is no longer a distant ambition, it is a present-day imperative. As the digital economy accelerates, Visa remains committed to supporting every business, regardless of size, so they can thrive in a connected, competitive, and increasingly cashless world,” he said.
The whitepaper outlines four key opportunities:
Boosting Productivity: 45% of MSMEs cite productivity as a primary motivation for digitalisation, yet adoption remains uneven. Only 46% currently use online solutions for finance and accounting. Street vendors highlight the benefits of digital payments: 98% report reduced hassle during peak hours, and 95% note faster sales and instant payments. Visa supports productivity through solutions such as Visa Commercial Pay, which streamlines financial operations and provides real-time data in a secure environment.
Strengthening Cybersecurity: With Malaysia recording 19.62 million cyberattacks in the first half of 2024, more than half of MSMEs rank cybersecurity among their top concerns. Visa addresses these risks through secure solutions such as Visa Token Service and Cybersource, which employ tokenisation and advanced fraud detection to protect transactions and build consumer confidence.
Improving Cash Flow and Capital Management: Financial management remains a challenge, with 31% of MSMEs citing working capital as a major concern. A significant 75% of owners use personal cards for business transactions, blurring financial visibility. Visa’s suite of solutions, including virtual cards, helps separate personal and business expenses, automate reconciliation, and improve transparency, crucial as Malaysia prepares for its 2026 e-invoicing mandate and seeks to close a US$21.5 billion funding gap.
Finding New Revenue Streams: Digitalisation enables MSMEs to expand reach and diversify income. The study found that 32% of MSMEs believe digitalisation helps develop new sources of revenue, while 29% say it allows access to new customer segments. Street vendors are increasingly adopting digital tools, with 64% digitalising sales, 57% moving marketing online, and 72% using mobile banking. Visa Accept helps overcome barriers by enabling merchants to
Malaysia’s MSMEs are entering a pivotal phase in their digital journey. As more businesses embrace digital tools, they unlock efficiencies, expand reach, and contribute to a broader ecosystem shift towards digital readiness. Visa’s whitepaper underscores that, while challenges remain, MSMEs are well-positioned to accelerate transformation and thrive in the digital economy with the right support from industry players, government initiatives, and technology providers.
