CTOS Digital Bhd (KL:CTOS) is preparing to roll out new scoring models built on telecommunications and digital payment data over the next 12 to 18 months, a move that could affect how creditworthiness is assessed.
This move is driven by “thin files” — borrowers who fall outside the traditional credit system, including gig workers, the underserved segment and small and medium enterprises (SMEs) that may lack formal income documentation, says group CEO Ankur Sehgal.
“Thin-file customers are not necessarily higher risk. They are simply less visible in traditional data. Alternative data helps improve inclusion and assessment accuracy,” he continues.
Currently, most data flowing into the credit ecosystem still comes from banks, limiting visibility into borrowers whose financial activity sits outside formal lending channels.
“I think growth will be limited on the credit bureau side. However, we are expecting growth from digital banks and non-bank lenders, which will be the main drivers for the credit bureau market,” he says.
As growth in the traditional credit bureau business matures, CTOS Digital is positioning itself as a credit intelligence platform rather than just a repository of credit records.
The company is investing in artificial intelligence (AI) and machine learning to develop new scoring models, automate credit decision-making and strengthen fraud detection. It is also entering into partnerships to access alternative data, including e-commerce activity, bill payment histories and digital transactions.
Digital banks and fintech players, which lack sufficient internal data to build their own credit models, rely on external scoring and assessment tools.“New digital banking players do not have a very long internal repayment history for assessment, so because of that they cannot build their own scorecards right now. For them, the dependency on strong credit scores and assessment models is even greater, particularly in the early stages of lending,” he says.
Ankur expects products involving alternative data and new solutions to contribute between 5% and 10% of group revenue over the next three years, which he describes as a conservative estimate.
“We want to go beyond being a traditional credit bureau to becoming a trusted data and intelligence platform that supports every stage of the credit lifecycle,” he says.
The group is looking to expand telecommunications-based credit scoring in Malaysia, building on models already deployed in Indonesia and the Philippines.
“In these countries, there are a lot of customers who are not part of the formal financial bureau platform, so we partnered with telcos there to assess their data and come up with alternative data scoring,” Ankur explains.
CTOS Digital is currently in talks with a few of the largest telecommunications providers in Malaysia, with testing and proof-of-concept exercises currently underway ahead of a potential rollout over the next 12 to 18 months.
In the Philippines and Indonesia, CTOS’ operations are gaining traction, with both businesses turning profitable in the first quarter of this year. Collectively, these two markets are expected to contribute a larger share of revenue, rising from about 15% currently to around 20% by 2028.
The group also holds a 24.825% stake in Business Online Public Co Ltd (BOL), a market leader in business information in Thailand.
Domestically, CTOS Digital has partnerships through JurisTech (49%) and RAM Holdings Bhd (57.675%).
Monetising its domestic base
Malaysia remains CTOS Digital’s largest market, with the bulk of revenue coming from 600 institutional clients across banks and corporates. The group is focused on improving these relationships by expanding the range of products and services offered, particularly as it rolls out new analytics and digital solutions.
Its proprietary IDGuard platform, which provides the banking sector with real-time automated alerts on potentially fraudulent credit applications, is already used by 10 major banks in Malaysia, Ankur says.
“Fraud IDGuard is not here to replace the national credit registry. It is basically to complement that,” he says.
Moreover, the group is developing capabilities in digital identity verification and electronic know-your-customer (eKYC) processes, leveraging Malaysia’s MyDigital ID initiative.
“This is expected to improve the accuracy and efficiency of identity verification. With MyDigital ID, there will be real-time verification with a central registry,” he says.
SMEs are also a key segment, with more than 20,000 SMEs currently using CTOS Digital’s Credit Manager platform, which enables them to conduct credit checks, monitor changes in customer profiles and manage repayment risks.
A broader upgrade of the platform is now underway, with enhancements to product features, offerings and overall user experience currently in progress. “Some of the features and the UI/UX will be enhanced significantly,” says Ankur, referring to improvements in the platform’s interface and overall user experience.
Apart from businesses, CTOS Digital serves more than five million consumers who use its services to access credit reports and related tools. Having already partnered with Touch ’n Go, the group is looking to expand such partnerships to integrate its reports and scores into other digital platforms.
To improve its offering, CTOS Digital is preparing to relaunch its consumer app in the coming months, offering access to credit reports, monitoring tools and fraud alerts, alongside features aimed at improving financial awareness.
This includes alerts on potential fraud risks, such as suspicious activity or indicators of exposure on the dark web, as part of efforts to give consumers greater visibility over their credit profiles.
Established in 1990 and regulated under the Credit Reporting Agencies Act (CRA) 2010, CTOS Digital is one of Malaysia’s largest credit reporting agencies, with more than 30 years of credit data history.
In 2025, CTOS Digital reported net profit of RM104.6 million on revenue of RM326.1 million.
Earnings for the year included a RM17.9 million one-off gain from the disposal of its 26% stake in Experian Information Services (Malaysia) Sdn Bhd.
More recently, the group reported revenue of RM81.6 million for the first quarter of FY2026, up 7.3% year on year, while normalised profit after tax and minority interests rose 35.1% to RM20 million.
Earnings before interest, tax, depreciation and amortisation (Ebitda) increased 26.6% to RM27.6 million, reflecting operating leverage even as the group continues to invest in technology and infrastructure.
CTOS Digital is targeting revenue of RM430 million to RM440 million by 2028, with annual growth of about 10% to 11%.
New credit law brings non-bank lending into focus
The Consumer Credit Act 2025, which came into force in March this year, brought a wider range of non-bank lenders into a formal regulatory and reporting framework.
The Act established the Consumer Credit Commission and requires credit service providers such as buy-now-pay-later (BNPL) operators, leasing companies and factoring firms to be licensed. Credit service providers including debt collection agencies and debt management firms must also be registered.
For CTOS Digital, this brings unreported lending activity into the data ecosystem, improving visibility and assessment. Ankur says from a risk perspective, the Act benefits lenders by providing clearer visibility into borrower leverage.
“Now based on the Consumer Credit Act, credit service providers are supposed to contribute to the CRA, and not just contribute, but they need to use that data to do the affordability assessment,” says Ankur.
In tandem with these changes, CTOS Digital launched a non-bank bureau platform in March to facilitate data sharing across this segment, which includes BNPL providers, fintech lenders and peer-to-peer (P2P) platforms, at an event attended by Deputy Finance Minister Liew Chin Tong.
Technology investment and platform enhancements are among the company’s biggest cost drivers, as it works to keep its systems and infrastructure in line with industry and regulatory standards while supporting the rollout of new digital and data-driven solutions.
Ankur adds that CTOS Digital has recently upgraded its infrastructure to improve resilience and redundancy. Talent, particularly in data, analytics and technology, is another key area of investment.
In addition, the group incurs costs for each data pull, including from Bank Negara Malaysia’s Central Credit Reference Information System.
Competition remains active, with several licensed agencies operating in Malaysia, although market share is concentrated among a few larger players alongside CTOS Digital, including Experian and Credit Bureau Malaysia (CBM).
“Global players definitely have more global experience. However, in Asia, it’s important to have more localised products and a more personalised experience for customers,” Ankur explains.
Alongside competition, the role of credit reporting agencies and how they are perceived remains a key issue. Ankur acknowledges that the perception of CTOS Digital as a “blacklisting” agency still exists.
“CTOS Digital does not make lending decisions or blacklist individuals. We provide data and analytics to help lenders make informed decisions,” he says, adding that it is equally committed to improving and maintaining data accuracy and quality as an ongoing focus.
Trust and reputation are central to the business, particularly for a credit reporting agency handling sensitive data.
“Trust is built when consumers, clients and customers believe in your service and resiliency, and that you have the platform and security to protect their data,” he says.
Against this backdrop, Ankur, who joined the group earlier this year, is now focused on executing the group’s next phase of strategy.
With nearly two decades across risk management, data analytics and digital banking, including establishing and supporting digital banks in the region, he says his experience gives him an end-to-end view of the credit lifecycle, from data to decisioning to digital customer experience.
“Half my career was in risk management, working on data analytics, modelling and scorecards. After that, I moved into digital banking,” he says.
Source: klsescreener.com
