WHEN Malaysia's government committed RM5 billion in loan guarantees for export-oriented companies during Budget 2026, it made a clear bet on regional expansion.

But after a decade building across Southeast Asia, the complex reality is that hidden financial frictions often determine whether that ambition succeeds or stalls. Malaysia's economy is strong — GDP grew by 5.2% in 2025, driven by over RM163 billion in digital investments, with companies like 99 Speed Mart Retal Holdings Bhd (KL:99SMART) and Sunway Property expanding abroad.

But most businesses face a different reality. For SMEs — 97% of Malaysian companies and nearly 40% of GDP — many are at an early level of their digital journey. Once they expand cross-border — collecting in Jakarta, paying suppliers in China, managing FX across markets — complexity rises quickly.

I've sat on multiple sides of this table.

In my previous role as director and head of Business Development at Shopee, I watched Thai and Vietnamese consumers leapfrog from cash to digital wallets. At McKinsey SEA, I advised clients and government-linked funds in financial services on digital business model transformation. As a co-founder of my own start-up, I personally experienced the problem of payment friction.

And now, overseeing Airwallex's expansion across Southeast Asia, I work with businesses every day whose cross-border financial infrastructure wasn't built for the regional ambition they now have.

The pattern across all of those vantage points is consistent: the tools have advanced, but the habits haven't.

Southeast Asia is often treated as a single market. It isn’t.

Each country’s financial system has evolved differently — shaped by infrastructure, regulation, and consumer behaviour. Vietnam leapfrogged from cash to wallets, Thailand scaled PromptPay through government rails, and Indonesia developed a fragmented wallet ecosystem now consolidating.

These models work domestically, but break across borders. A Malaysian business collecting in multiple markets or paying suppliers across different currencies faces fragmented rails, inconsistent settlement timelines, and varying regulatory requirements.

I saw this first hand at Airwallex with a leading Malaysian super app expanding across Asean. Despite strong ambition, it struggled with large volumes of cross border transactions like refunds, due to high SWIFT fees and settlement times, losing to local competitors in cost. And in the Southeast Asia tech scene that burned cash for growth, every cost stacks up, threatening start-ups’ fundamental survival when funding dried up in the market winter of 2022. That experience stuck with me because the problem had nothing to do with policy, effort, or even aspirations.

It was a payments infrastructure problem, and one that will determine which businesses can go global and prosper.

On infrastructure, Malaysia is well-positioned. DuitNow transactions grew from 360 million in 2023 to 870 million in 2024, with value more than doubling to RM31.1 billion. Bank Negara Malaysia has built a credible, forward-looking regulatory environment, and the DuitNow–PayNow link with Singapore was a regional first.

The gap is not infrastructure — it’s adoption.

Among mid-market businesses, cross-border payments still default to familiar channels. This is less about availability and more about awareness. Many are paying unnecessary costs in time, fees, and FX spreads simply out of habit.

Budget 2026 reinforces the government’s intent — from RM5 billion in SJPP guarantees to the RM60 million Matrade grant and the introduction of Asean Business Entity status to support regional expansion. As Prime Minister Datuk Seri Anwar Ibrahim put it, “the creativity of our people must not be limited by borders.”

The direction is clear. The infrastructure is in place. The question: Are businesses moving with the same urgency?

The businesses that treat cross-border finance as a strategic capability — not a compliance task — will have a clear edge.

First, moving beyond legacy habits. Tools for multi-currency treasury, cross-border collections and embedded finance are already mature, across fintechs, banks and payment providers. The gap isn’t availability — it’s whether businesses are actively seeking better solutions.

I realised this when co-founding Yinyang Wellness, an integrated wellness centre selling medical services and premium tea. We relied on traditional banking and quickly ran into friction — delays opening accounts in Thailand, difficulty getting cards for ad spend (two years), slow POS setup and costly, fragmented ways to pay my China suppliers to get a lower fee than 3% on international cards.

Hidden FX fees and the reconciliation of ad spend with our Thai accountant became a constant pain point. Paying our tea supplier — around US$30,000 to US$40,000 — was equally challenging. To avoid the ~3% fee on international cards via Alipay, we had to rely on other channels to reduce costs, but had to break up the transaction into 10 tranches.

Even basic setup took time — getting a POS terminal from a bank took at least four weeks, forcing us to find alternatives to avoid losing customers who could only pay by card.

FX fees became a constant drain on cash flow and finance reconciliation drained time away from growing the business. In some cases, we had to rely on personal credit cards for business spend or break up supplier payments just to reduce costs. For many businesses, these are daily operational constraints restricting growth.

Second, building for regional complexity, not assuming it away. Southeast Asia won’t standardise overnight. Winning businesses adopt infrastructure that enables teams to manage multiple markets, currencies, and payment flows from a single platform.

Third, treating financial operations as a source of competitive advantage, not back-office friction. In a region where speed of execution often determines market leadership, the ability to move money as fast as decisions are made matters. Remember the old adage, cash flow is king.

These limitations pushed me to look beyond traditional banking. As a founder, I became deeply interested in how cross-border financial tools could better support start-ups and SMEs. It’s also what made Airwallex’s mission personally compelling — because these frictions weren’t minor inconveniences, they directly impacted our cash flow and ability to grow.

Malaysia has the infrastructure, policy intent, and market position to set the benchmark for B2B fintech adoption across Southeast Asia.

The question now is simple: Will your financial operations keep up with your ambition?

Those that answer decisively won’t just participate in Southeast Asia’s growth — they’ll define it.

Andrew Chim is the head of Southeast Asia expansion at Airwallex, a global financial technology platform.