Southeast Asia’s digital economy is growing rapidly, yet future expansion will likely rely on much more than population size, funding, or high-tech aspirations. Increasingly, the question is whether the infrastructure underneath these opportunities is ready to support businesses and consumers at scale. Malaysia provides a useful example of this dynamic. Its banking system, digital payments infrastructure and regulatory environment are relatively developed, while continued efforts to reach underserved groups show that even mature digital markets can have gaps between their market potential and market readiness.
We explore why Southeast Asia’s emerging startup hubs are developing outside capital cities.
Market potential is not the same as market readiness
A market may be appealing in theory while remaining challenging to operate in reality. Large populations, rising incomes, government digitalisation plans and strong investor interest can generate significant potential. However, companies still require customers who are able to access their services, efficient payment methods, practical identity verification and regulations that facilitate efficient product entry to the market.
This aspect is especially important for financial technology. A company can find millions of potential customers, but their ability to convert that population into active customers depends on whether these customers can open accounts, make payments online, verify their identity and have access to appropriate financial products. Malaysia’s experience shows why these underlying systems matter. Bank Negara Malaysia reported that digital financial usage reached 92% in 2024, while by the end of 2025 all five licensed digital banks had begun operations and collectively served 2.4 million customers.
Maybank’s RM10 billion signal
Through its ROAR30 strategy, Maybank plans to invest RM10 billion over five years in technology, data and artificial intelligence. This investment is aimed at improving technological capabilities at Maybank while simultaneously fostering growth across its regional markets. However, what makes this investment significant is not just the amount invested.
The fact that a large company in the financial sector is making an investment of billions of ringgit in technology, information, and AI indicates that the surrounding market is gradually shifting from basic digital adoption to infrastructure-intensive digital services. Apart from this, Maybank has also been developing a retail banking platform that can be deployed in several markets, with Indonesia being identified as one of the first possible rollout markets. This reflects the significance of interoperability and regional scale within the Southeast Asian financial ecosystem.
Malaysia’s next challenge is inclusion
Malaysia’s digital infrastructure is becoming increasingly mature. Market readiness, however, continues to hinge on reaching individuals who have historically been neglected or underserved. According to the 2025 Annual Report from Bank Negara Malaysia, some segments of the population continue to struggle to open and use bank accounts. For this specific reason, the revised Basic Banking Services framework requires banks to provide basic savings and current accounts to eligible customers and microenterprises. This includes groups that previously may be unserved or underserved.
As Malaysia serves as a regional employment and business hub, its financial infrastructure has to be functional even for foreign employees and residents who make cross-border transfers. The scale of digital transactions highlights the rapid pace at which the underlying system is advancing. For instance, in 2025, Malaysia recorded 18.4 billion e-payment transactions, a 25% increment compared to 2024. The volume of DuitNow QR transactions had doubled to 3 billion, while the number of registered DuitNow QR touchpoints was almost 3 million by the end of the year. There was a 70.1% increment of e-remittances to RM31.6 billion. These systems are crucial as they allow businesses to move beyond having a large addressable market and towards having a market that can actually transact.
Indonesia shows the other side of the equation
Indonesia is home to a digital economy that has enormous market potential while infrastructure gaps remain visible. In 2025, the World Bank identified Indonesia as the largest digital economy within ASEAN. This was measured by gross merchandise value. At the same time, it highlighted the differences in internet quality and adoption, especially beyond major cities. Many rural areas, schools and health facilities still lack high-speed connectivity, while data centre capacity requires a more supportive investment and regulatory environment to reach its full potential.
This provides a good contrast with Malaysia. While Indonesia has impressive scale, scale alone does not necessarily translate into seamless operations. A tech company may have access to millions of potential customers, but the pace of expansion still depends on connectivity, payments, regulation, logistics and digital trust. For businesses entering emerging Southeast Asian markets, the lesson is that infrastructure maturity determines how quickly market potential can become commercial reality.
Digital infrastructure has to extend beyond connectivity
Digital transformation requires many components to interact successfully, namely broadband connectivity, cloud computing, digital identity, payment systems, cybersecurity and regulatory processes. Malaysia’s progress in payments serves as a good example of this interconnected model. Bank Negara Malaysia reported that active mobile banking users grew by 8.7% to 25 million in 2025, while mobile banking accounted for 64% of the online banking channel.
In 2025, the financial sector reached Phase 1 of sandbox testing for MyDigital ID, with Phase 2 involving wider industry participation. The central bank also tested innovations such as electronic Know-Your-Customer procedures for foreign workers. Although it may not be as visible as a new data centre or major business investment, it can affect how easily businesses onboard customers and launch digital products.
What emerging ecosystems can take away?
For the new tech ecosystems developing in Southeast Asia, Malaysia’s experience points to a more general principle: market readiness is built underneath the headline numbers. Governments can draw investors, banks can pour billions into technology, and startups can identify massive consumer markets. But businesses ultimately require the infrastructure that allows people to participate.
The next frontier for Southeast Asia’s digital economy will not only involve efforts to secure capital or set ambitious goals. The countries and cities that are most prepared to take advantage of these opportunities to build viable enterprises are those that enhance their underlying infrastructure, from payment systems and digital identity to connectivity, banking access and regulation. The case of Malaysia proves that even in markets that have achieved substantial progress, readiness is an ongoing process rather than a finished milestone.