11th August 2025 - 4 min read
KAF Digital Bank officially opened to the public on 8 August 2025, following a mandatory Perintis pilot phase where its services were tested by a select group of users. As Malaysia’s second fully Islamic digital bank, it is licensed by Bank Negara Malaysia and operates entirely through its mobile application. Here’s an overview of what customers can enjoy.
The bank’s core product is the Akaun Simpanan-i (Savings Account-i), which follows the Islamic concept of Qard. Under this principle, deposits are treated as interest-free loans to the bank, which must be repaid in full upon demand. Any returns are given as hibah, a discretionary gift, and are not guaranteed. KAF has published historical hibah rates from its pilot phase, showing a rate equivalent to 5.00% per annum for balances up to RM2,000 and 3.00% per annum for balances above RM2,000, but notes that these figures are not indicative of future returns.
Customers can choose between the Basic Plus Savings Account-i or the Premium Savings Account-i. The Basic Plus tier provides a daily outgoing transaction limit of RM5,000 and a monthly limit of RM20,000. The Premium tier increases these limits to RM50,000 daily and RM200,000 monthly, and also waives the RM12 annual fee on the physical Debit Card-i. Both tiers come with a free virtual debit card for online transactions.
All account functions are managed through the KAF Digital Bank mobile app. Customers can check balances in real time, review transaction history, make transfers via DuitNow and DuitNow ID, perform DuitNow QR payments, and pay bills using the virtual card. The app also provides access to monthly e-statements and digital payment receipts.
For security, the app supports biometric login and PIN authentication, and uses SecureKAF, which binds the account to a single registered device and requires all transaction approvals to be authorised within the app, replacing the need for SMS TACs. Newly opened accounts may be subject to a temporary cooling-off period during which certain features, such as DuitNow QR payments, are disabled.
KAF’s banking services are integrated with the POD Savings rewards system, which operates through a separate app. Customers can earn POD Points through eligible transactions and redeem them via the POD Points Marketplace for products, services, or vouchers. In specific campaigns such as “Scan & Collect”, customers may earn POD Points for DuitNow QR transactions that meet a stated minimum spend in a single receipt.
To mark its public launch, KAF is running a FinLit Lucky Draw campaign in collaboration with POD, encouraging customers to engage with financial literacy content. By registering interest via the ONZBanking site and completing one FinLit article in the POD app, participants stand a chance to win prizes such as Umrah packages, U-Mobile vouchers, and MyRapid passes, provided they also complete full onboarding in the KAF Digital Bank app.
To open an account, customers must download the KAF Digital Bank app from the Apple App Store or Google Play Store. The app requires iOS 16 or later, or Android 13 or later, and is not currently compatible with Huawei devices.
Registration is completed in the app by entering personal details, completing electronic Know-Your-Customer (e-KYC) verification using MyKad, and agreeing to the bank’s terms and conditions.
To activate the account, a first-time deposit of at least RM10 must be made from a personal conventional or Islamic bank account in Malaysia that matches the account holder’s name; transfers from e-wallets or other digital banks are not accepted for this step. Once the deposit is received, the account is activated and the virtual debit card is issued instantly.
Customers who wish to upgrade to the Premium tier can submit supporting documents, such as bank statements, directly through the app.
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Samuel writes about personal finance and financial news, focusing on how banking updates, policies, and promotions affect everyday money decisions. He enjoys making complicated financial topics easier to follow. Outside of writing, he spends his time watching TV shows and occasionally convincing himself he will only watch one episode.
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