As one of the few women in fintech, Indrawathi Selvarajah defied the odds to start PayHalal, Malaysia’s first Islamic payment gateway
KUALA LUMPUR, March 9 — As a corporate lawyer with 25 years of experience, Indrawathi Selvarajah was first attracted to Islamic fintech because of its ethical financial system.
Little did she expect to face so many obstacles when she decided to start PayHalal, Malaysia’s first Shariah-compliant payment service provider in 2017.
First was the lack of funding because there was almost no Islamic venture capital fund available.
“Even if it is there, VCs (venture capitalists) would rather fund male-founded or male-run companies,” she said.
Then VCs would often prefer pitches from male entrepreneurs to their female counterparts.
In addition, women-run startups are often overlooked as they tend to focus on solutions to unique women’s problems.
But these challenges only made Indrawathi stronger, and four years later she succeeded in founding and funding PayHalal.
A merchant license was issued by Bank Negara in 2021.
“So here we are today, the only one operating as an Islamic merchant/payment gateway with Sharia certification,” said Indrawathi, now a fintech legal specialist.
“Building it from scratch was an interesting journey that stretched us to the max in terms of our ability to see something, which has never been done, through.”
Sales director at PayHalal, Azhani Azman, agrees.
She explained that in banking it is conventional and Islamic, but people often forget that Islamic needs are endless.
The concepts of akad or the transaction carried out by two or more parties and murabaha, where the seller and buyer agree on the costs and the mark-up are key in Shariah-compliant banking.
“With our payment gateway, there is no riba (imposed interest) and no gharar (uncertainty, deception),” explained Azhani, a former banker.
“For all our transactions, we have wakalah or authorization, the most important criteria for Islamic payment.”
So far, the response has been good with a growth of 30 per cent month-on-month.
It is aimed at 10,000 female merchants by the end of the year.
Unlike other payment service providers, PayHalal has Halal Kitty, which offers its merchants the option to collect payment via QR payment instead of the conventional payment terminal.
“Halal Kitty is an offline QR that replaces the terminal,” Azhani explained.
“All payment methods in one QR, one platform. We are the first and only one to do this.”
“We make it easy for our customers as opposed to them getting a terminal from a bank, which would also be time-consuming and costly,” added Indrawathi.
Another first for PayHalal is qard hasan, a microloan program, which is still in the pipeline.
It is aimed at women entrepreneurs who will not be able to get loans from banks as their credit scores do not allow it.
“From these women we don’t need to collect security, we don’t need to have any guarantees,” said Indrawathi.
“We want to give them an opportunity to start and own a business. We want to give them a head start because the banks won’t.”
It is clear that financial inclusion for women is high on the agenda for PayHalal.
“The gender gap in terms of financial understanding and inclusion for women also affects them in terms of the overall financial ability to earn money and income for the family,” she continued.
Female representation for fintech is also necessary because research results show that they produce better results than their male colleagues.
“Because of their inclusiveness and their ability to provide a diverse form of meaning,” Indrawathi explained.
She added that fintech is just one segment of the financial industry that was previously very male-dominated.
“But now you see female players coming in very aggressively, and they’re actually asking for more women, for more diversity.
Despite the progress, women-run startups continue to face the same challenges caused by lack of representation, stereotypes, lack of networks and negotiation skills.
To overcome this, Indrawati said women entrepreneurs need to find ways to network and gain visibility in the industry, as well as find funding opportunities from sources that prioritize diversity and inclusion.
“Inclusion is going to create a broader spectrum that is going to trickle down from the top in terms of employment, benefits and even to the basics like work from home flexibility.”
She said that women’s ability to balance things comes from the women themselves.
It comes from a global agenda to promote women’s cause in the market, especially in fintech, which is even smaller.
“So now the opportunity for fintech has appeared, we should ride this opportunity, we should take it on, this is the best time to be a woman.”