Fathi Ridzuan A Fauzi | Managing Director & Group CEO

Pradotec: Providing Trusted Authentication Technology Solutions Since 1990

The need for hardware development company’s providing trusted authentication technology solutions is on the rise today. Pradotec is a hardware provider company with key expertise that supports the identification and authentication for e-passport, border control, micropayment, and security technology systems.

Pradotec’s hardware solutions are driven by experience as world pioneers in electronic identification and e-passport technology. Incorporating the latest security standards, their solutions are deployable to a variety of industry segments.

Securing the safety of the community’s identity in the physical and digital exchange realm has always been their objective. The team at Pradotec is driven by the intention of facilitating the demands of the government and private sector verification that safeguard today’s Smart Technology, Internet of Things and more.

Pradotec’s existence can be traced back to the mid-1990 in Malaysia when a group of engineers at IRIS Corporation Berhad worked on introducing the first e-passport (or also known as biometric passport) in the world.

The same team was then involved in the introduction of the first national identity card that incorporates both photo identification and fingerprint biometric data on an in-built computer chip embedded in a piece of plastic.

The team leader, Tony Lee, then founded Pradotec Corporation to produce the authentication devices that are required to authenticate the Malaysian e-passport and the Malaysian national identity card, the MyKad.

Today, the Pradotec engineering team utilizes their experience and knowledge to deploy these solutions in various fields, including registration, enrollment, ticket inspection and identity verification.

Mentioned below are the highlights of the interview:

Kindly elaborate on your company’s unique products or services.

Pradotec focuses on producing devices for trusted identity authentication, where digital on-boarding processes can be enhanced. In Malaysia, every citizen above the age of 12 are required to carry the national identity card, MyKad.

MyKad is required to be authenticated not only during financial transactions in the financial sector, but the authentication is also required wherever a person’s identity need to be authenticated, such as hospitals, legal offices, government agencies etc.

Besides producing authentication devices for the MyKad, Pradotec also produces authentication devices to authenticate passports of any nationalities, not only in border control but also for transaction authentication as mentioned earlier.

The authentication technology introduced by Pradotec has also been extended to payment terminals.

What makes your company stand out from the rest of its competition?

With regards to the MyKad authentication device, Pradotec’s device is the only one in Malaysia that has been certified by CyberSecurity Malaysia (CSM), an entity under the purview of the Ministry of Communication and Multimedia of Malaysia. CSM had introduced a Technology Security Assurance (TSA) Scheme, whereby trusted identification authentication devices are tested vigorously to ensure the devices meet the criteria of security functional test and penetration test. These two criteria are based on the Mandatory Security Functional Requirements (MSFRs) developed by the Information Security Certification Body (ISCB).

What kind of challenges has your company faced in its initial days of establishment and what are the struggles it is going through now?

During its initial days, Pradotec was focused on the production of authentication devices for IRIS Corporation under Original Equipment Manufacturer (OEM) basis. It therefore did not produce any devices under its own brand. This is no longer the case, as a branding exercise was undertaken to advance the Pradotec brand to the market. Whilst the company still produces devices under OEM arrangement, it is more focused today in producing and selling its own brand.

Today, its biggest challenge is meeting the production targets that are being hampered by the global shortages of electronic chips, which have not only increased production time, but also increased costs.

Kindly describe the current industry scenario that your company is catering to.

With faster adoption of digital transformation by almost all business sectors, Pradotec no longer caters only to government or quasi-government agencies. Due to enhanced authentication processes being adopted by most business organizations, there are more requirements for authentication devices, from such sectors as financial, medical, legal, hospitality etc.

What technological updates have been adopted by your company to enhance its operations?

  • Register On Mobile – enable users extract data utilizing Pradotec’s mobile devices from ID document and perform registration process and manage the registered data
  • POS / CRM – enable users to generate customer data via ID document, manage customer data, and perform basic Point of Sales features.

What advice would you like to give the young entrepreneurs and start-ups that are willing to enter in the industry that you are catering to?

This is a niche industry, requiring strong technological expertise in trusted identification authentication technology. Therefore, any entrepreneurs or start-up interested in entering the industry would need the technological knowledge, and expertise to be able to enter the business. This is on top of the heavy capital investment that would be required to produce the devices.

What does the future hold for your company in terms of growth?

Digital adoption has been a global trend since the year 2018. Businesses are going into digital transaction and big data for better planning and as a strategy to improve accessibility, speed, traceability, and cost efficiency. With the pandemic in the year 2020, more and more businesses are going into digital transformation to create a safer business environment and to create more value to customers.  In line with digital adoptions, company cultures change in a way that promotes greater innovation, creativity, and attention to developing significant customer experiences.

Although digital transformation will vary widely based on organization’s specific challenges and demands, there are a few constants and common themes among existing case studies and published frameworks that all business and technology leaders should consider as they embark on digital transformation.

Even regulators recognized the need for businesses to embrace digital transformation. In view of this progression, the central bank of Malaysia, Bank Negara Malaysia had in June 2020 unveiled its eKYC (electronic Know Your Customer) guidelines ahead of its virtual banking framework.

This new policy is in effect immediately for all financial institutions including banks, insurers, remittance companies, money changers and more.

The policy document aims to accelerate and streamline practices of industry players in their adoption of e-KYC technology, the online process of identifying and verifying individual customers.

e-KYC enables the digital on-boarding of customers to occur anytime and anywhere. With the implementation of e-KYC, a majority of customers no longer need to visit the physical premises of a financial service provider to open an account. In addition to increased customer convenience, the digital on-boarding of customers enabled by e-KYC also lowers cost for both users and providers. One crucial component of the financial data space is the ability of players to onboard their customers through digital means, quickly, efficiently, and safely.

As such, our goal is to:

  • Offer conclusive mobile solution to support the gap for identity verification and authentication – document scanner and biometric reader in one device that can be done remotely and/or offshore from head quarter or branch, i.e. On-the-go mobility solution
  • Develop application that provides quick data capturing, utilizing mobile devices.
  • user friendly and comprehensive mobile application that enables User to perform data management.
  • with the data captured on hand it would provide business entity with more insights and understanding with the Customer and or transaction within the business.

About the leader

Fathi Ridzuan A. Fauzi, the Managing Director and Group CEO graduated with a BSc in Accounting and Financial Analysis from the University of Warwick, United Kingdom. Started his career in 1989 in the insurance industry, followed by more than 15 years in the Malaysian stock exchange, Bursa Malaysia, where he held various senior positions in financial, operations and development roles. During his tenure with the stock exchange, he was involved in various major initiatives, including the introduction of the Central Depository System, Human Resources Information Management System, the new trading platform (based on the Euronext platform), and the demutualization of the exchange.

After leaving Bursa Malaysia in 2005, he was involved in risk management consultancy, followed by the Business Process Outsourcing (BPO) industry when he joined the largest call centre operator and managed network services provider in Malaysia. This was then followed by his own BPO consultancy outfit.

He then set up a venture capital management company (registered by the Securities Commission of Malaysia), focusing on turnaround projects and distressed companies. It was from his involvement with distressed businesses, that he ended up in the Pradotec Group, where he started restructuring the business in 2019 and now building the business to a new growth path.