Malaysia to Limit Cash Transactions in 2020

[Xxmodded]

It is exhilarating because if cash transaction will be limited in Malaysia there is a huge chance that bitcoin and cryptocurrencies will be recognized and became more popular because they will be focusing in online transaction or cashless, so there might be a chance that more people will be using bitcoin and other cryptocurrencies that would result of increasing of it's prices.

Most of the transactions were cashless or digital now a days for that we don't need cryptos,only very less percentage of total fiat money in the world is in physical form others were in just digital figures of banks database so that government didn't change anything to be honest.

Mobile banking might be the intention of Malaysia but since some transaction in bank if like in my country is still laggy or have occurring maintenance then it's not gonna be effective and the vest way if we wanted a much easier and faster transactions is too use cryptocurrency if those store I used to buy stuffs accept crypto I'll be willingly pay via crypto.

How about with investor use much value cash money for their transaction, will limited on Malaysia and give bad effect for them? I think is not good implementation to limited cash transaction, by higher volume cash transaction every day can give opportunities for get much profit but when cash transaction have limited will give bad impact with profit.

[1715083886]

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[Sithara007]

I'm sure the crime syndicates they say they are trying to stop would just find other ways to launder all that money. They can probably even spread out the transactions among several accomplices.

It's not going to affect the average household so I don't think people are going to complain much. Maybe they are planning to go the way of India and demonetize the larger denominations and then either replace them with newer ones or just straight up remove them and have most large transactions be electronic (which can be easier to keep track of).

The government had implemented similar measures here in India, and I have to say that they failed. Most of the transactions are still being done using physical cash (despite the government implementing a maximum threshold on the amount of physical cash that an individual can keep with him). And I don't have any reason to believe that similar actions can be successful in Malaysia.

[lobat999]

The government had implemented similar measures here in India, and I have to say that they failed. Most of the transactions are still being done using physical cash (despite the government implementing a maximum threshold on the amount of physical cash that an individual can keep with him). And I don't have any reason to believe that similar actions can be successful in Malaysia.

Good to know this! But lets not throw away our hopes just yet in fighting financial crimes. Maybe the Malaysian Government will have a familiar strategy as what you've describe but will also add some other useful policies to make it more effective.

And who knows?, maybe the Malaysian Government will be more successful on implementing that policy as compared to India that could result to its effective implementation. So lets see what will happen next.

[GideonGono]

The government had implemented similar measures here in India, and I have to say that they failed. Most of the transactions are still being done using physical cash (despite the government implementing a maximum threshold on the amount of physical cash that an individual can keep with him). And I don't have any reason to believe that similar actions can be successful in Malaysia.

Good to know this! But lets not throw away our hopes just yet in fighting financial crimes. Maybe the Malaysian Government will have a familiar strategy as what you've describe but will also add some other useful policies to make it more effective.

And who knows?, maybe the Malaysian Government will be more successful on implementing that policy as compared to India that could result to its effective implementation. So lets see what will happen next.

The have a plan that they do that and there are many useful things or plan before they implemented because they need to agree by a lot of powered government before they implement the rules. But sometimes there are some disadvantage of the rules they implemented.

[Betwrong]

Firstly, Malaysia is not the first country to make this statement and the last time i checked most of the country later don't proceed with the process but if the government actually push this through it will definitely boost the use of crypto currency there.

Will it boost cryptocurrency use? Or the use of Visa and Mastercard (with nice fat fees for both of them)?

I think your question itself contains the answer to it. Although Bitcoin is not recognized as money by the Malaysian government, it is neither banned in the country, and people are free to use it as well as elsewhere in the world where it's not banned. So, I think it's obvious that, if Bitcoin will not be banned in Malaysia around the same time the restriction on the use of cash comes into force, some people will choose to use it, in order to avoid the "nice fat fees", you've mentioned.

[Blackdeath]

(Image grabbed from https://www.busonlineticket.com/blog/petronas-twin-towers-the-landmark-of-kuala-lumpur)

The country is set to implement an unprecedented restriction on the use of cash.^[1] This is doubtless the first time that a country is to implement such bizarre measure to counter the abuse of cash. Somehow, this national policy is implying that cash, at least within the country, is being abused for various illegal activities.

While some business communities are against such drastic measure as it would certainly affect their day to day operation, an idea pops out that they could actually circumvent this policy by adopting the use of Bitcoin and other cryptocurrencies.^[2] An ordinary household in Malaysia is said to spend around 8,000 Malaysian Ringgit (RM) per month, way below the 25,000 RM limit. But still, a lot are clamoring to increase the limit as the current proposed limit is way to low.

Would you care to share your thoughts on this? Will this really be a window for significant growth of Bitcoin or crypto adoption in this Southeast Asian country?

Sources:
[1]

• https://www.channelnewsasia.com/news/asia/malaysia-to-impose-cash-transaction-limit-of-rm25-000-in-2020-12072710
• https://www.thestar.com.my/news/nation/2019/11/08/business-community-says-no-to-rm25k-limit
• https://www.thestar.com.my/business/business-news/2019/11/07/malaysia-to-impose-cash-transaction-limit-of-rm25000-next-year

[2] https://bitcoinist.com/bitcoin-usage-may-spike-following-cash-restrictions-in-malaysia/

In my own opinion, if other countries like Malaysia limits cash transaction there will be a huge chance that bitcoin would increased it's popularity that more people will be using bitcoin and cryptocurrency rather than using cash because it will be convenient for them to purchased online and in real life. Bitcoin and other cryptocurrencies would increased it's price if this happened in every country all over the world.

[NeuroticFish]

the 25,000 RM limit

In my country (Romania) such limit exists for some years now. Just iirc it's about 10000 EUR / cash transaction, so 45000 RM.
And I can tell that I know only 2 cases average Joe faces these limits: when selling/buying a home (house, apartment) or a (new) car, which operations usually happen through bank / credit anyway.
So I think that it's not a real / big problem.

[teosanru]

For your information this is not the first time that such a measure to limit cash transactions has been made by any country. India is following this rule for quite some time. The businesses around the country are not allowed to spend any amount exceeding ₹10000 per day to single person otherwise same will not be allowed as an expense under Income Tax. Moreover with some new rules even receipts exceeding ₹20000 have been circumvented and have to be notified to the income tax department. This however is for reduction of tax evasion done due to flow of black money. Moreover Banks are even charging cash handling charges to further reduce the flow of cash in Economy.

[panganib999]

Well I understand where Malaysia is coming from, the country is very counter reactive for every unpleasant activities such as this, to curb elicit activities and to  strenghten the country's financial integrity. Suggesting malaysian people to use bitcoin as an alternative payment method is a good idea, it will surely boost up bitcoin economy once people started following it especially if big businesses do as said since bitcoin's volatility is affected by how high or the demand is due to the limited supply of it. But the problem is, people could still use online transferring of money through banks and still use fiat in order to do so, This is why I don't think this act of malaysia is enough to push people of the latter into using bitcoin since there's still some way close to what they traditionally know they could still resort.

[daarul50]

Just because they limit the cash transactions doesn't mean that it will be digital currency right away.

It would make a big difference and would send a lot of people into bitcoin world however there is still credit and bank cards (debit card) and credit card etc etc, nowadays banks mobile apps even use the QR code payments so forth which means before bitcoin becomes too big in Malaysia there is just one enemy down but 5 more to go. That is really all around the world if you ask me , yeah we do use cash in our countries right now for example but how much cash are we really using?

Do you really use cash (paper money) like you used to? I personally don't. I use my banks debit card and I personally use my mobile app for almost everything I spend my money on.

classic overconfident crypto supporters , you can not blame about this, the excitement is too high haha

bitcoin in malaysia is not fully friendly, they tried to regulate everything involved cryptocurrency but the strict financial regulator in malaysia still has a heart to make a local fintech -crypto based- company to grow by making the regulation a bit easier.
what is the correlation? the news about malaysia to impose cash transaction limit should be a big opportunity for those local fintech to show off to takes a stage in the business.

this situation is a bit complex but for the crypto supporters it is just simply the day of crypto currency become mainstream used everywhere in malaysia is just really near. i am not sure to agree with this , i only hope it could really come true.

[Mometaskers]

I'm sure the crime syndicates they say they are trying to stop would just find other ways to launder all that money. They can probably even spread out the transactions among several accomplices.

It's not going to affect the average household so I don't think people are going to complain much. Maybe they are planning to go the way of India and demonetize the larger denominations and then either replace them with newer ones or just straight up remove them and have most large transactions be electronic (which can be easier to keep track of).

The government had implemented similar measures here in India, and I have to say that they failed. Most of the transactions are still being done using physical cash (despite the government implementing a maximum threshold on the amount of physical cash that an individual can keep with him). And I don't have any reason to believe that similar actions can be successful in Malaysia.

I heard there were raids to take away money from the people, did those raids stop? Last I heard the government there just replaced the demonetized banknotes with a newer design. If that was that case then it was indeed a failure since IIRC they wanted people to just use smaller bills (forcing them to go through banks for large transactions).

But who knows, this might work for Malaysia since they are not really restricting the use and ownership of the bills, just putting a limit on use which many estimate is enough for most people's needs ($6k is already a large sum in SE Asia). IMHO the limit should be per transaction. If the average monthly expenses is RM 8K I don't think people would spend that much in just a single transaction. Of course all these regulations mean nothing to the informal sector.

[Betwrong]

the 25,000 RM limit

In my country (Romania) such limit exists for some years now. Just iirc it's about 10000 EUR / cash transaction, so 45000 RM.
And I can tell that I know only 2 cases average Joe faces these limits: when selling/buying a home (house, apartment) or a (new) car, which operations usually happen through bank / credit anyway.
So I think that it's not a real / big problem.

I agree. It can be a problem for high-end criminals and corrupt officials, but for regular people it can't be. In fact, common people can benefit from the restriction, because, instead of being stolen and laundered, money will flow in the right direction: to public schools, state hospitals, etc.

As for the legit firms in Malaysia, who regularly, each day, buy goods and services with the amounts that surpass the 25,000 RM($6,000 USD) limit, I don't think they usually pay with cash for something priced over that limit.

[auntyjmary]

This would be a good policy if implemented well and with the cooperation of the citizens. There are many challenges that comes with the use of cash and not just limited to money counterfeiting alone. The world is gradually moving  towards a cashless system, this is just the beginning many innovations which many other countries would follow.

[Vishnu.Reang]

This would be a good policy if implemented well and with the cooperation of the citizens. There are many challenges that comes with the use of cash and not just limited to money counterfeiting alone. The world is gradually moving  towards a cashless system, this is just the beginning many innovations which many other countries would follow.

No one will be objecting to such measures if it is done on a voluntary basis. But here they are limiting the use of physical cash and forcing the citizens to use digital payment options. And this is where I am not comfortable with the whole idea. Whether I want to use physical cash or digital cash, is up to me. The government has no right to dictate the terms here.

[rose9696]

This is a positive move of the Singapore government to support the 4.0 technology industry.
I appreciate this because when we pay with cryptocurrencies or credit card currencies it is faster and the service is faster.
A world that is growing and accelerating will need technology. what a smart move!

[Obito]

This is so sudden for a certain plan to be on run. Transactions specially big businesses are just merely a daily or a basic happening for a big businesses. Banning it won't make a hindrance for them although it filters out transaction. It would just turn out to be alot of work like when you have a big transaction and it is not allowed anymore it would be cut off into two so that it would get pass through from restrictions.

[JeffBrad12]

This is a positive move of the Singapore government to support the 4.0 technology industry.
I appreciate this because when we pay with cryptocurrencies or credit card currencies it is faster and the service is faster.
A world that is growing and accelerating will need technology. what a smart move!

LOL this is malaysia's government and it's not like restricting the use of Cash will do any better but just restricting people from doing what they want. Yeah paying using card is fast and more but you will ended up paying unnecessary fee that should not be there in the first place if you are using cash. although using cash sometimes inconvenient but people have option right? it's always better to keep people choose for themselves whether to use cash or card because restricting like that is not a good solution even when the problem isnt there in the first place.

[EdvinZ]

The Malaysian government wants to control all cash flows of citizens, and therefore adopted such prohibiting laws. Perhaps they thus want to bring the whole business out of the shadows and counter corruption. But this is not freedom, in a free state everyone is free to decide in what form to carry out monetary transactions.

[abhiseshakana]

No one will be objecting to such measures if it is done on a voluntary basis. But here they are limiting the use of physical cash and forcing the citizens to use digital payment options. And this is where I am not comfortable with the whole idea. Whether I want to use physical cash or digital cash, is up to me. The government has no right to dictate the terms here.

LOL this is malaysia's government and it's not like restricting the use of Cash will do any better but just restricting people from doing what they want. Yeah paying using card is fast and more but you will ended up paying unnecessary fee that should not be there in the first place if you are using cash. although using cash sometimes inconvenient but people have option right? it's always better to keep people choose for themselves whether to use cash or card because restricting like that is not a good solution even when the problem isnt there in the first place.

The role of government in a country is very important. Without the government of a country, stability will not be achieved and will become weak and easily swayed by outside forces. Obedience to the Government will create security and order and prosperity.

The main reason for limiting cash transactions is, with the use of cash, which aims to complicate efforts to trace the origin of money originating from criminal acts, the Actor tries to break the tracking of the flow of funds to the recipient of the funds by conducting cash transactions. This is different from large amounts of non-cash transactions that can be tracked by financial transaction analysts. Restrictions aim to minimize the space for corruptors and criminals to eliminate traces or launder their money.

Everyone likes the freedom to choose the type of transaction that we want to do, but as citizens, we must submit to government decisions. Besides that, I think that the limitation of cash transactions of MYR 25,000 targets the upper-middle class, not the lower middle class. if someone is clean, there is no need to worry about following this rule because the positive values are more than the negative side.

[Getmon]

The Malaysian government wants to control all cash flows of citizens, and therefore adopted such prohibiting laws. Perhaps they thus want to bring the whole business out of the shadows and counter corruption. But this is not freedom, in a free state everyone is free to decide in what form to carry out monetary transactions.

The people of Malaysia cannot be free as to use cash whenever and whatever way they want. They are free but if they are using fiat to purchase illegal stuff such as illegal drugs, illegal arms, services that are also illegal, bribery, and so on, they should be stopped by the government at all cost. I guess the reason why Malaysia started to implement this law is to curb the proliferation of these problems.