Electronic currency

Over the years, money as we know it has been undergoing transformation. The shape and form of money has changed from precious metals to metal coins and paper money with no intrinsic value and today it presents us with a formless form in the name of digital or e-money. The digitization of money appears to be inevitable in the light of the recent developments with regards to the Internet and the various e-commerce opportunities presented by the World Wide Web. The future of e-commerce depends to a great extent on the appropriate development and diffusion of e-money.

The Bank for International Settlements, has defined electronic money as the monetary value measured in currency units stored in electronic form on an electronic device in the consumer's possession. E-money in the Malaysian is taken to include electronic purse initiatives such as MEPS cash and stored value card such as Touch ‘n Go cards. The development of the national e-purse is one of the objectives under the Multimedia Super Corridor (MSC) concept managed by the Multimedia Development Corporation of Malaysia (MDC). This e-purse will have the capability of storing MEPS cash for retail payments.

The Touch ‘n Go cards were originally intended for toll payments along the Malaysian highways. The cards may either be linked to ones credit or bank card with automatic reload facilities to a stipulated maximum level once the amount on the cards fall to a predetermined minimum level. The cards may also be reloaded at some of the toll booths or at some banks ATM terminals. Despite the availability of these cards, it is not surprising to find long queues during peak hours along the cash booths along the local highways. Nevertheless, it is interesting to note that today the Touch ‘n Go cards are also used for other payments such as parking bays and train and bus fares.

To date the growing usage of stored value cards can basically be seen in the context of Touch ‘n Go cards. In this context, it must be noted that all Malaysian citizens are issued an identity card which is also a chip based multipurpose card. However, the extent to which the full potentials of these cards are exploited by the typical Malaysian citizen is questionable. The future of e-money in Malaysia will depend to a great extent on the appropriate support services and facilities made available to facilitate the use of these initiatives. Furthermore, the value in terms of usability and convenience to the consumers will be another factor that would significant determines the adoption and usage of these e-money initiatives.