Cross-Border Consumption: Malaysian Residents Fuel RM15.8bn Expenditure in Neighboring Border Towns

By Editorial Staff

The landscape of Malaysian consumer habits underwent a significant transformation in 2025, with cross-border spending hitting a milestone of RM15.8 billion. According to the latest Expenditure of Malaysian Residents Survey Report (PRM) 2025 released by the Department of Statistics Malaysia (DOSM), this surge reflects a growing trend of regional mobility, driven by daily commutes, tourism, and business activities in towns bordering Indonesia, Singapore, Brunei, and Thailand.

As Malaysia continues to integrate deeper into the regional economy, the data provides a granular look at how, where, and why residents spend their money when crossing national boundaries.

Main Facts: A Decade of Growth in Border Spending

The 2025 survey marks a vital update to the previous study conducted in 2017, revealing a substantial increase in total expenditure—from RM10.5 billion eight years ago to RM15.8 billion in the current reporting period. This represents a compound annual growth rate (CAGR) of 5.2%. While the aggregate figures have surged, the average expenditure per resident grew at a more modest rate, rising from RM349 to RM361, reflecting a 0.4% annual increase.

Perhaps most revealing is the composition of this spending. Food and beverages (F&B) dominated the wallets of Malaysian travelers, accounting for 32.7% of total expenditure. This was followed by accommodation (22.5%) and transport (18.8%), highlighting that for many, these trips are not merely for leisure but are rooted in essential logistical and lifestyle needs.

The data underscores the dominance of the southern border, with Singapore remaining the primary destination, accounting for a staggering 86.7% of total expenditure. This is primarily funneled through the Tambak Johor (Johor Causeway) and the Gelang Patah entry points, which together handled the vast majority of cross-border financial activity.

Chronology and Context: The Evolution of the PRM Survey

The PRM survey is a quinquennial (five-year) exercise conducted by the DOSM to gather critical input for the "travel services" component of Malaysia’s Balance of Payments. By tracking spending patterns at major land and sea entry points, the government can better understand the outflow of capital and the impact of regional mobility on the domestic economy.

From 2017 to 2025: A Changing Landscape

The transition between the 2017 and 2025 reports illustrates the shifting priorities of Malaysian travelers. While the 2017 data established a baseline, the 2025 survey expanded its scope to include 10 immigration entry points across six states, providing a more comprehensive geographic spread.

New additions to the survey, such as the Sungai Tujuh station in Sarawak, offer a more nuanced view of the East Malaysian border experience. Furthermore, the 2025 report introduced a deeper analytical framework, categorizing the purpose of visits into five distinct segments: work, tourism, visiting family, business, and transit. This evolution in methodology allows policymakers to distinguish between the routine spending of daily cross-border commuters and the discretionary spending of tourists.

Supporting Data: Dissecting the Spending Patterns

The DOSM report offers a deep dive into the mechanics of these transactions, revealing significant disparities between travel modes and visitor types.

Land vs. Sea: The Dominance of the Road

Land routes accounted for an overwhelming 98.8% of the total RM15.8 billion spent. Within this, buses led the way as the most popular expenditure channel, accounting for RM7.7 billion (48.9%), followed by cars (39.3%) and motorcycles (9.8%). Interestingly, while buses held the highest total, individual car travelers reported a higher average expenditure of RM460 per person, suggesting that those traveling by private vehicle possess a higher disposable income or travel in groups that facilitate higher spending.

Sea travel, while representing only 1.2% of total expenditure, showed the highest average expenditure per person at RM650, likely due to the longer travel times and specific ferry-related logistics involved.

Overnight Stays vs. Day Trippers

The duration of the visit significantly dictates the weight of the wallet. Overnight visitors, who accounted for 85.8% of total expenditure, spent an average of RM427 per trip. The correlation between the length of stay and expenditure was stark:

• One night: RM191 average
• Two nights: RM721 average
• Three nights: RM933 average
• More than a week: RM2,703 average

Conversely, day trippers—those staying less than 24 hours—accounted for 14.2% of total expenditure, with an average spend of RM187. This group is largely composed of daily commuters, particularly those working in Singapore, who contribute to the economy primarily through food and transport.

Payment Methods: The Cash-Still-King Reality

Despite the global trend toward digitalization, cash remains the dominant medium for cross-border transactions among Malaysians. Cash accounted for 59.6% (RM9.4 billion) of total expenditure, compared to 40.4% (RM6.4 billion) via cashless payments. The heavy reliance on cash in high-traffic areas like Tambak Johor suggests that traditional market environments and small-scale F&B vendors in border towns still prioritize or require cash-based transactions.

Official Insights: Regional Disparities

The DOSM survey highlights that the purpose of a visit drastically alters spending behavior:

1. Work-Centric Commuting: At Tambak Johor, where 77% of residents cross for work, spending is functional—focused on food (31.3%) and transport (23.7%).
2. Tourism and Family: At the same checkpoint, those traveling for tourism or to visit family reported significantly higher spending, with tourism averages hitting RM881 and family visits reaching RM1,114.
3. Regional Hotspots: Stulang Laut recorded the highest average expenditure at RM704 per resident, positioning it as a premium entry/exit point compared to the newer, lower-cost station of Sungai Tujuh (RM100).
4. Northern Border Dynamics: The northern border paints a different picture. While Bukit Kayu Hitam sees significant F&B spending (34%), Pengkalan Hulu showcases a unique reliance on entertainment, which accounts for 38.4% of its total expenditure, suggesting a different leisure-oriented demographic.

Implications: What This Means for Malaysia

The findings of the 2025 PRM survey have profound implications for economic planning and policy development.

1. The "Border Town" Economy

The fact that F&B and transport dominate spending suggests that the economic impact of Malaysian residents is largely localized to the immediate border zones of neighboring countries. For Malaysian businesses, this highlights a "leakage" effect; domestic spending is being diverted to support the F&B and service industries of Singapore, Thailand, and Indonesia.

2. Infrastructure and Traffic Management

With land routes accounting for 98.8% of expenditure, the data serves as a clear indicator of the massive traffic volume passing through the Johor-Singapore crossings. The reliance on buses and cars underscores the urgent need for enhanced public transport infrastructure and border-crossing efficiency to support the daily mobility of the workforce.

3. Digital Financial Integration

The 40.4% share of cashless transactions is a notable figure that suggests a growing, albeit slow, transition toward digital payments. Financial institutions and fintech players have a significant opportunity to capture the remaining 59.6% of cash-based expenditure by promoting cross-border QR payment systems and digital wallet interoperability, which could streamline the experience for millions of travelers.

4. Policy Focus on "Stay Duration"

The sharp increase in expenditure for longer stays suggests that the tourism sector should focus on initiatives that incentivize visitors to extend their trips. By developing "stay-longer" packages in border regions, authorities could potentially increase the per-capita contribution of travelers to the broader tourism economy, rather than relying solely on the high-volume, low-spend day-tripper demographic.

The Bottom Line

The 2025 DOSM report confirms that for the Malaysian resident, the border is no longer a barrier but a bridge. Whether it is the daily commute to a job in Singapore or a seasonal shopping trip to Thailand, the RM15.8 billion outflow reflects a deeply interconnected regional lifestyle. As Malaysia navigates the future, understanding these cross-border financial flows will be essential for balancing the benefits of regional mobility with the need to sustain domestic economic growth.

For more detailed data and to access the full survey report, visit the official Department of Statistics Malaysia website.