How this tool is helping Malaysia towards a cashless government

By Yun Xuan Poon Justin Tan

Interview with Omran bin Omar, CIO, and Muhamad Shukri bin Ramli, Chief Assistant Director, Information Management Department, at the Ministry of Housing and Local Government.

If cash wasn't dead yet, it quite certainly is now. The pandemic is edging society towards cashlessness in a way no other single event ever has, The New York Times wrote.

For many governments, going digital was the only way to continue providing critical services in the public health crisis. Malaysia in particular is working to keep this trend around for the long term. Its finance ministry announced in May this year that all government transactions must be cashless by 2022.

The Ministry of Housing and Local Government (KPKT) has created an online portal to help the public sector reach this goal. Omran bin Omar, CIO, and Muhamad Shukri bin Ramli, Chief Assistant Director, Information Management Department, at KPKT share how it works, and how it could help realise Malaysia’s vision for a cashless government.

What it does

PBTPay allows citizens to pay taxes, fines and licensing fees to all levels of local government, including city, municipal and district. Its name borrows from an acronym for the Malay term referring to local authorities.

The website makes paying taxes for multiple properties much faster. Citizens don’t have to visit websites for each of the local authorities; they can instead pay at one go, just like with online shopping. “You just add to cart like Shopee or Lazada,” Shukri says.

This works as long as local authorities enroll in the PBTPay system. Nearly 70 had joined by July this year, and KPKT hopes to onboard all 99 agencies in Peninsular Malaysia before the end of 2021, shares Omran.

The website also covers payments for local council premises’ rent, car park fines, and license fees. Malaysia has a dedicated portal for submitting building plans, getting approvals and paying the necessary fees for infrastructure projects. It uses PBTPay’s system to process payments, Shukri notes.

KPKT has connected PBTPay with databases from other parts of government to make sure nothing falls through the cracks. For instance, it’s linked to vehicle registration data from the road transport department. Local authorities will not only have the license plate number of the offending vehicle, but also the name of the owner.

They can then send citizens reminders to pay the fine. They “cannot ignore anymore because they will find you,” says Shukri.

One for all, all for cashless

This tool will be an important way to move Malaysia towards its vision for cashless public services, Omran believes.

Most urban regions did pretty well on their own, but some rural governments did not have the equipment or expertise to shift services online in the pandemic. Federal agency KPKT’s tool offers a hand to these local authorities.

“We pay for the local area network, we pay for the services, we pay for the maintenance and all the federal compliance. The federal government covers all the expenses,” says Omran.

Malaysia also needs this cashless system to be integrated. There are hundreds of local authorities, some of which already run their own platforms. “We have to try to make the one system in the whole Malaysia,” Shukri shares.

The team designed PBTPay to be “dynamic and universal, so that it can be used within the government agencies, and not only for the [local authorities] but for all”, he adds. They chose to start on a small scale with taxes, but intend to expand it to other forms of payments in the future.

Analyse away

The ministry shares data from PBTPay with the respective local authorities, so they can improve its services. Trends and patterns from payment data can be helpful in setting bill reminder schedules and predicting incoming sums.

It also uses data to monitor server performance and minimise downtimes. For instance, the servers may choke up whenever local authorities send a mass reminder for tax payments. They can then adjust the servers to increase their performance, Shukri explains.

This is especially crucial for an online service. Physical counters only operate from nine to five, but “the server needs to be up 24/7 - even at midnight, people make the payment,” he adds.


Security is paramount for a platform that deals with so much sensitive financial information. All data is only processed within the federal government data center, so it never leaves the network.

Even when KPKT shares data with local authorities, it goes through the government’s internal telco network, notes Shukri. Only appointed officers can access the data, so any leakages can be easily traced.

The team is receiving a lot of requests from both local authorities and other ministries to use the payment system. KPKT hopes for the tool to “be expanded as an official of government portal system which can save cost and time for setup for Malaysia government”. After all, PBTPay is but a small start to a cashless future in Malaysia’s public service.