Malaysian Service Sectors Adopt FEDI to Boost Exports and Imports

Abstract

Financial Electronic Data Interchange (FEDI) refers to making cash payments electronically rather than utilizing any form of traditional payment methods such as physical checks. The merger of two unique systems namely Electronic Fund Transfer (EFT) and Electronic Data Interchange (EDI) has brought about this new technology. The primary objective of this study is to ascertain how FEDI is currently being implemented by the Royal Customs and Excise department of Malaysia, which is the agency responsible for administrating indirect tax policies in the country. Specifically this study examines the implementation of FEDI, pre and post business processes that were facilitated, transfers of payment received from customs to its various agents and clearance of forms. The study also examines the efficiency of the facilitation and enhancement of business processes due to the implementation of FEDI. This is a classic case of business process reengineering within the department through technology adoption i.e. FEDI.