Malaysia has recorded the fastest growth in its digital economy in Southeast Asia, growing 19% year-on-year and projected to achieve a gross merchandise value (GMV) of $39 billion by 2025.
The data was presented within the tenth edition of the e-Conomy SEA Report 2025 by Google, Temasek and Bain & Company. The report notes that this growth is on account of digitally resistant consumers and stable economic conditions, including controlled inflation.
Regionally, Southeast Asia’s digital economy is predicted to exceed $300 billion in GMV by 2025, growing 15% annually – 1.5 times higher than previously forecast. The region of over 680 million people continues to display resilience despite the impact of the pandemic, global inflation and provide chain pressures.
Growing 21%, e-commerce drives Malaysia’s GMV
E-commerce stays the biggest contributor to Malaysia’s digital economy. Its value is predicted to achieve $20 billion by 2025 after recording 21% annual GMV growth, making it the second fastest-growing company in Southeast Asia.
Bain & Company explains that the primary drivers are the consolidation of major platforms and the growing dynamics of video commerce. Video commerce currently accounts for roughly 10% of total GMV.
National data also show a positive trend. The Department of Statistics Malaysia (DOSM) reported that e-commerce revenues from January to September 2025 reached MYR937.5 billion, a rise of 1.9% in comparison with the identical period last 12 months.
The highest figure was recorded within the second quarter at MYR313.8 billion, which declined barely within the third quarter to MYR312.6 billion.
The digitization of enterprises can be progressing. The 2024 ICT Utilization and E-Commerce Report shows that e-commerce revenues reached MYR 1.18 trillion in 2023, led by developments within the manufacturing, services, construction and agriculture sectors.
Digital financial services are also seeing double-digit growth. Digital payments are expected to achieve $213 billion in gross transaction value (GTV) by 2025.
Bank Negara Malaysia has recorded a 28% increase within the adoption of digital payments because the DuitNow QR standard continues to expand cross-border interoperability in Southeast Asia, accelerating the transition to cashless transactions.
Online travel is gaining momentum
The online travel sector has turn out to be certainly one of the fastest growing segments. Malaysia’s tourism industry GMV increased by 19%, the best in Southeast Asia. This growth is driven by expanded air connectivity, visa liberalization policies and large-scale digital tourism campaigns ahead of Visit Malaysia 2026.
In the primary half of the 12 months, foreign tourist arrivals increased by over 20%. Travelers are also increasingly selecting digitally integrated travel services.
The report noted that arrivals have almost returned to pre-pandemic levels, while accommodation properties in markets similar to Malaysia and Singapore have been in a position to increase average rates by greater than 20%.
Efforts proceed to strengthen the travel sector through partnerships with online travel platforms and various promotional programs, supporting the goal of 45 million visitors in 2026.
Google Malaysia adds that using artificial intelligence (AI) within the digital sector can be growing rapidly. Malaysian consumers are cited as probably the most energetic users of generative AI tools within the region.
Strengthening Malaysia’s technology ecosystem
The Malaysia Digital Economy 2025 report highlights the rapid development of the country’s digital ecosystem. The variety of subscriptions for fixed and mobile broadband access reached 49.2 million in 2025.
4G coverage increased to 98.8% and 5G coverage reached 82.4%. The government continues to enhance communications infrastructure to support digital development.
The expansion of large-scale data centers can be accelerating. The adoption of artificial intelligence, Internet of Things (IoT), process automation, cloud services and cybersecurity solutions further strengthens the foundations of Malaysia’s digital economy.
These aspects support the continuing digital transformation and strengthen Malaysia’s position as certainly one of the leading digital development centers within the region.
