Malaysian Central Bank said Monday it has received encouraging interest from various parties in submitting applications for digital insurers and takaful operators (DITO) licence(s), just three months into the start of the two-year application window that began on January 2, 2025.

Bank Negara Malaysia (BNM) said in a statement that this positive reception reflects a strong belief in the push for greater innovation to enhance the insurance and takaful industry.

The planned consultation sessions with interested applicants are currently underway.

The application period will remain open until 31 December 2026.

BNM may announce successful applicants during or after this period, if any.

According to BNM, efforts to close the insurance protection gaps remain uneven with unmet needs still prevalent among underserved and unserved segments of society.

For instance, less than half of Malaysians have life or family takaful protection coverage.

The insurance and takaful industry must innovate to bridge these gaps, helping consumers better prepare for unexpected events.

By effectively leveraging technology and digital advancements, insurers and takaful operators (ITOs) can address supply and demand challenges, resulting in more personalized and diverse product offerings beyond traditional services.

“With DITO, BNM hopes to further strengthen the financial system with more inclusive, competitive and efficient offerings in line with the evolving needs of consumers,” BNM Governor Abdul Rasheed Ghaffour said.

Recognizing these opportunities, DITOs are expected to offer significant value in inclusion, competition, and efficiency, said the statement.

Applicants are expected to understand and address the protection needs of digitally focused consumer segments by offering tailored products and services.

They should aim to enhance efficiency to their end-to-end operations to deliver a seamless customer experience.

Alongside the existing ITOs, DITOs can strengthen the financial system by fostering responsible innovation for Malaysians and achieving the goals outlined in the Financial Sector Blueprint 2022-2026, it added.

KAF-Carsome consortium’s KAF Digital Bank receives license approval to commence operations