KUALA LUMPUR (Oct 6): Malaysian banks are working towards introducing fraud alert capabilities that can flag potential risks before a transaction is completed.

A pilot test involving selected banks is targeted for the first half of 2027 ahead of wider implementation, Bank Negara Malaysia governor Datuk Seri Abdul Rasheed Ghaffour said in his speech text for a conference on financial crime and counter terrorism financing on Tuesday.

“These alerts will prompt customers to pause, think and verify before proceeding,” he said.

Fraudulent transactions and scams are a major problem globally. In Malaysia, the financial sector has prevented some RM1.9 billion in attempted fraudulent transactions, surpassing the RM1.2 billion prevented during the whole of 2025, according to the central bank’s data.  

More than 1,600 suspicious accounts, many of which were subsequently assessed as presenting mule-related risks, were flagged to-date by Malaysia’s digital payment backbone PayNet.

The planned fraud alerts may introduce “additional friction for customers,” Abdul Rasheed acknowledged.

“However, these measures are necessary to strike an appropriate balance between offering convenience and protecting customers from fraud, particularly authorised scams,” he stressed.