An Expat's Guide to Banking in Malaysia

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If you’re looking for a bank in this country you now call home, Editor Chad Merchant relates his experiences and gives a personal testimonial that may help you narrow your choices.

Like many expats, I was initially bewildered by the differences between banking in my home country and banking here in Malaysia. Particularly when it comes to depositing a substantial sum of money, you want to do your homework and make an informed decision. With that in mind, I’d like to share my own experience with you and give you a recommendation to consider.

Peace of Mind

Most well-developed countries have a safety net in place to protect depositors in the event of their bank’s failure. In the US, for example, this falls to the Federal Deposit Insurance Corporation, which was formed by an act of Congress in 1933 following the thousands of bank failures that occurred in the Great Depression. Today, each depositor is insured for at least US$250,000. Such insurance, which is automatic at FDIC member banks, engenders faith and confidence in the nation’s banking system.

Happily, Malaysia fairly recently created a similar safety net, Perbadanan Insurans Deposit Malaysia (PIDM). This corporation protects your deposits, as well as any insurance benefits, in the event of the failure of a member bank or insurance company. The deposit insurance system came into effect in September 2005 and protects depositors to a maximum of RM250,000 per depositor per member bank, which, according to PIDM, covers 99% of banking customersin full. The insurance covers singly or jointly held current (checking) and savings accounts, fixed deposits, trust accounts, and also covers foreign currency deposits. For virtually every bank operating in Malaysia, membership in PIDM is compulsory.

Specifically, all commercial banks licensed under the Banking and Financial Institutions Act 1989 (BAFIA) and all Islamic banks licensed under the Islamic Banking Act 1983 (IBA), including foreign banks operating in Malaysia, are member institutions of PIDM. No additional action is required of a depositor; the insurance is provided automatically, and at no charge.

Making the Choice

So with the security of my deposit assured regardless of which bank I chose, I could turn to finding a bank that met my specific needs. My personal list of criteria included seamless internet banking, a Mastercard or Visa debit/ATM card, widespread availability of ATMs, reasonable fees, and the ability to wire (via telegraphic transfer) funds to my accounts back in the US. Features like online bill payment and mobile banking were also strongly considered.

I spent a couple of weeks researching a number of banks and ultimately narrowed my list of contenders to four: Maybank, CIMB, Hong Leong, and HSBC; all worthy choices. The vast network of not only ATMs but cash and cheque deposit machines vaulted Maybank and CIMB to the top spots, as did both of these banks’ well-developed internet banking portals, Maybank2U and CIMB Clicks, respectively.

Ultimately, however, I elected to go with CIMB. Their internet banking services are superlative in every measure, from security to user interface to functionality to scope. I can pay my bills, top up my prepaid phone account, pay my rent, transfer money to any other bank in Malaysia, and more – with ease.

Wiring money back to the US is also simple and CIMB charges only a flat fee of RM10 per transfer and recently increased the per-transaction telegraphic transfer limit from RM10,000 to RM50,000. CIMB also has a vast network of ATMs not only in Malaysia, but a network-linked system that extends to Indonesia (CIMB Niaga), Singapore (CIMB Bank Singapore), Thailand (CIMB Thai), and Cambodia (CIMB Bank Cambodia). With over 2,000 ATMs in Malaysia alone, CIMB uses their regional clout to extend this total to nearly 4,700 machines in the region all waiting to put cash in my hand with no associated fees or charges. CIMB also has the largest network of retail banks in the ASEAN region, with over 1,100 branches, on those occasions where I need to actually deal with a person!

SMOOTH SET UP

Opening the account was easy. CIMB offers a number of different accounts appropriate for expats, depending on both your personal needs and, naturally, your level of wealth. I chose the Prime current account, which pays interest (currently 1.5% per annum for accounts over RM50,000), and also provides a dedicated queue at branches. A minimum of RM1,000 is required to open the account. As with most banks, a valid Malaysian visa for working or living in the country is required for foreigners opening most accounts. However, some CIMB accounts and services are even available to non-residents.

Promoted

Once I provided my particulars, my account number was generated, I was given my Mastercard debit card (which also serves as my ATM card) on the spot, and was walked through the process of selecting a PIN code and signing up for CIMB Clicks. It was all very easy and handled professionally and quickly. I made my initial cash deposit in one of the cash machines, and within half an hour of walking into the bank, my financial relationship with CIMB had begun. Since then, I’ve also downloaded their fantastic CIMB Clicks app, which is available for both iOS and Android devices, and love it. I can transfer money, pay bills, top-up prepaid accounts, find nearby branches or ATMs, and check my CIMB account securely, all on the go.

It’s worth noting that, in my capacity as Editor for The Expat Group, I’ve had the chance to interact with a number of banks in Malaysia and only CIMB have made a point of telling us that they are targeting expats as customers, and are actively trying to improve their services and offerings to appeal to that segment, in obvious addition to their many Malaysian customers, as well. According to their head of retail financial services, Peter England, who is himself an expat here from Australia, “At CIMB, we will do our best to make expats feel at home in Malaysia. To be honest and upfront, we don’t always get it right, but we are continually thinking about ways to make our offerings better and more flexible for everyone, including expats, particularly in our CIMB Preferred banking offering.”

Mr England even went a step further: “If we aren’t able to meet your requirements, you can email me at [email protected], and I’ll try my best to help out.”

If you’re new in Malaysia, or are looking for a bank that meets your needs and welcomes your feedback, my personal recommendation would be to consider CIMB. By all means, look at them all, but given the breadth and scope of CIMB’s offerings, coupled with their stated desire to serve more of the expat community here in Malaysia, they are well worth considering.

Source: The Expat September 2012

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