Halim, E.H.B. and Basu, S. orcid.org/0000-0001-5863-854X (2024) Customer Due Diligence and Financial Inclusion in Malaysia: Balancing Regulatory Measures and Accessibility. Asian Journal of Comparative Law, 19 (2). 233 -254. ISSN 2194-6078
Abstract
This article critically analyses the substantial inadequacies of the current Customer Due Diligence (CDD) framework in safeguarding marginalised communities from financial exclusion in Malaysia. It highlights that for vulnerable groups such as rural inhabitants, undocumented migrants, and refugees, the CDD, as currently framed and applied, only impedes access to formal financial services. While Malaysia's implementation of a risk-based approach in CDD policies complies with global standards of CDD, this article argues that these standards fall far short of effectively helping marginalised communities. In addition, there is evidence that banks are exhibiting over-cautious compliance behaviour, which resulted in banks hesitating to implement some of the CDD flexibilities introduced by the regulators. In order to address these problems and overcome the barriers, proposals for the development of new CDD strategies are analysed. These include reducing documentation requirements, widening the list of acceptable documents, and introducing entry-level accounts. The aim is to address banking access issues for marginalised communities without compromising the regulatory objectives of CDD. The article recommends that CDD regulations can better assist financial inclusion if they are tailored to the specific needs of the excluded communities by using a risk-based approach.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © The Author(s), 2024. This is an open access article under the terms of the Creative Commons Attribution License (CC-BY 4.0), which permits unrestricted use, distribution and reproduction in any medium, provided the original work is properly cited. |
Dates: |
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Institution: | The University of Leeds |
Academic Units: | The University of Leeds > Faculty of Education, Social Sciences and Law (Leeds) > School of Law (Leeds) |
Depositing User: | Symplectic Publications |
Date Deposited: | 01 Sep 2023 10:21 |
Last Modified: | 10 Mar 2025 14:01 |
Status: | Published |
Publisher: | Cambridge University Press |
Identification Number: | 10.1017/asjcl.2024.11 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:202893 |