How Cardtrend Collaborated with a Leading Fuel Retail Company to Support Malaysia’s Government Initiative to Rationalize Diesel Subsidies
Discover how Cardtrend’s fuel card management system, FleetOps, empowered a prominent fuel retail company to effectively distribute diesel subsidies through its fuel card programs, available to businesses of all sizes, as part of a collaborative effort to implement Malaysia’s National Diesel Subsidy Rationalization initiative.
Background
On June 10, 2024, the Malaysian government launched the Diesel Rationalization Program to address diesel leakage caused by smuggling and misappropriation at fuel stations. This initiative introduced targeted subsidies projected to save the government up to RM4 billion annually. (Government Implements Targeted Diesel Subsidy For Peninsular Malaysia Effective 10 June 2024 (mof.gov.my)).
Under this targeted subsidy initiative, diesel subsidies were allocated to specific sectors operating commercial vehicles and public transportation through the Subsidized Diesel Control System (SKDS), with fuel card programs playing a central role in distributing subsidies in partnership with fuel retailers.
In response, a leading Malaysian fuel retailer adopted Cardtrend’s Fuel Card Management System (FleetOps) solution to manage diesel subsidies within its fuel card programs. This solution enabled the fuel retailer to allocate and track subsidies efficiently for eligible businesses.
The Partnership
The collaboration aimed to optimize fuel card programs and provide enhanced support to businesses eligible for diesel subsidies. Through FleetOps, the fuel retailer seamlessly onboarded new customers eligible for targeted subsidies, allowing them to choose fuel card programs that best suited their needs. Existing customers were transitioned smoothly, without requiring new cards, enabling the swift registration of approximately 410,000 vehicles nationwide. This solution ensured precise tracking of subsidy distribution, guaranteeing that businesses received their full entitlements while providing real-time transparency for customers to monitor their subsidy allocations.
This partnership not only strengthened the government’s initiative but also enabled businesses to access subsidies efficiently, reducing operational disruptions.
Solution / Services Differentiator
- End-to-End Subsidy Management: FleetOps provided a comprehensive solution for managing subsidies, covering every aspect from customer onboarding to subsidy distribution in full compliance with government regulations. The system ensured accuracy and efficiency throughout the process, with detailed reporting on subsidy disbursements, offering complete visibility and traceability for fuel retailers and regulatory bodies.
- Flexible Subsidy Payout Mechanism: The system supported different subsidy payout mechanisms based on the fuel retailer’s requirements, such as real-time, daily, or monthly payouts. It was also customized to specific payout schedules based on business needs.
- Customizable Eligibility Rules: The system allowed for quick adjustments to subsidy eligibility criteria in response to changes in government policies, ensuring that the right businesses or individuals received their benefits efficiently without manual intervention.
Key Attributes Fueling the Partnership
- Experience in Subsidy Programs: With over a decade of experience managing subsidy programs for fuel and fleet card customers in Malaysia, Cardtrend developed tailored solutions to effectively meet market needs.
- Adaptability and Flexibility: The solution was designed for adaptability, allowing rapid responses to market dynamics and regulatory changes while continuously enhancing functionalities to meet the evolving needs of businesses.
- Accuracy and Transparency: FleetOps processed large volumes of transactions with precise subsidy calculations and disbursements, supported by detailed reporting that provided fuel retailers and the government with clear visibility and traceability.
The Result
- With the fuel card provided by the fuel retailer, eligible businesses were able to reduce their diesel expenses by approximately 30% through the subsidy allowance.
- The fuel retailer expanded its fuel card customer base by 50% since the program’s launch, reaching businesses of all sizes.
- The partnership assisted the government in reducing subsidy disbursement costs, allowing funds to be reallocated to other critical areas.
