What is the B40 Community Income in Malaysia (2026)?
- Hopes Malaysia
- Jan 19
- 9 min read
How Much Does the B40 Group Actually Earn in 2026?
The B40 community in Malaysia refers to the bottom 40% of households by income, commonly benchmarked at ≤ RM5,249 monthly using past DOSM cut-offs. These households face high living costs, debt and inequality. Targeted subsidies, NGO aid and education/TVET pathways aim to raise social mobility.
What does B40 mean in Malaysia?
B40 stands for the Bottom 40% of Malaysian households when ranked by monthly income. The classification is widely used in policy, research and media to design support, subsidies and service delivery for lower-income groups.
The concept is rooted in the Department of Statistics Malaysia (DOSM)’s Household Income & Basic Amenities (HIS/BA) and Household Income and Expenditure (HIES) surveys, which are the official sources for income and household data.
Historically, income group labels (B40/M40/T20) rose to prominence in the 2010s as Malaysia’s economy urbanised and living costs in Kuala Lumpur and other urban areas accelerated.
Over time, they became short-hand for income classifications and target groups in the Twelfth Malaysia Plan and related policy discussions.
What is the current B40 income range?
Based on the Household Income and Expenditure Survey (HIES) 2022 conducted by the Department of Statistics Malaysia (DOSM), here are the updated income classifications:
B40 (Bottom 40%): Households earning up to RM5,249 per month.
M40 (Middle 40%): Households earning between RM5,250 and RM11,819 per month.
T20 (Top 20%): Households earning above RM11,819 per month.
These income figures are benchmarks derived from the 40th and 80th percentiles of household income at a given time.
They are not permanent cut-offs. As the economy shifts, so do the ranges. For example, the Household Income and Expenditure Survey (HIES) 2022 reported a median household income of RM6,338, highlighting that benchmarks are periodically updated.
It’s also important to note that the Department of Statistics Malaysia (DOSM) conducts these surveys at least twice within a five-year period, not on a strict “every two years” schedule.
Key Figures from HIES 2022
Median monthly household income: RM6,338
Mean monthly household income: RM8,479
Median income growth rate (2019–2022): 2.5% per year
Mean income growth rate (2019–2022): 2.4% per year
How do B40, M40 and T20 compare?
B40 (Bottom 40%): Lower disposable income, higher share of spending on essentials (food, housing & utilities, transport).
M40 (Middle 40%): Stretched by inflation, education and housing costs; vulnerable to shocks.
T20 (Top 20%): Highest earnings, larger shares for investment and education, more exposed to tax and subsidy reforms.
T15: In policy debates, you may see references to the top 15% (T15) as a subset of T20 when discussing progressive tax or targeted subsidies; treat it as a policy shorthand, not an official DOSM category.
Crucially, compare groups not only by income range but against the median income and cost of living to assess purchasing power and well-being.
How has the B40 category changed over time?
1990s–2000s: From a poverty-line focus to broader income groups as urbanisation accelerated.
2016–2019: Income grew, but living costs rose quickly in urban centres.
2020–2021 (Covid-19): Income shocks pushed some M40 households downward (“M40 slipped into B40”), especially those in services, gigs and self-employment.
2022: Recovery year; DOSM’s HIES 2022 reset the picture with a median income of RM6,338, confirming uneven rebounds across states and demographic segments.
What are typical household expenses for B40 families?
According to DOSM’s Household Expenditure Survey (HES) 2022, the largest expenditure components nationwide were:
Housing, water, electricity, gas & other fuels: 23.2%
Food & non-alcoholic beverages: 16.3%
Restaurants & hotels (meals out): 16.1%
Transport: 11.3%
B40 households typically allocate a higher share to essentials, leaving limited room for savings or education upgrades. Urban vs rural patterns differ: urban households face higher housing and transport costs, while rural households may face access challenges (schools, clinics, basic amenities).
How does the digital economy affect B40 households?
Malaysia’s digital economy offers new income channels, gig work (e-hailing, delivery), online micro-businesses, and e-wallet incentives such as eBeliaRahmah for youths. But two hurdles persist:
Access & quality gaps: While internet penetration is high overall (97%+ users in early 2024), rural coverage and speed consistency still lag; the JENDELA programme and 5G rollout continue to close these gaps.
Digital skills: Lower digital literacy impedes take-up of better-paid online work. Policy reports and think tanks highlight uneven household connectivity and skills, urging targeted training for B40 communities.
Helpful Authority Resources
Malaysia Digital Economy Blueprint (MyDIGITAL) – The government’s national roadmap for digitalisation, outlining strategies to drive Malaysia’s digital economy.
How does education impact B40 mobility?
Education and TVET are central to breaking intergenerational income constraints:
Scholarships & sponsorships like Yayasan Peneraju and MARA fund skills, certifications, and tertiary education for eligible Malaysians, including those from B40 households.
TVET Malaysia aligns technical skills with industry demand; for B40 earners, TVET often yields faster job placement and wage progression than general programmes.
Which NGOs support the B40 community?
A strong NGO ecosystem complements government aid:
Yayasan Hasanah – funds education, community development, and social finance pilots targeting vulnerable households.
MyKasih Foundation – cashless food aid and targeted support for B40 families.
MERCY Malaysia – healthcare and crisis response that often benefits low-income communities.
Food Aid Foundation – urban food bank support for B40 households.
Here is the list of the top 10 NGOs in Malaysia.
How does B40 distribution vary by state?
State-level differences are stark. Median household income in Kuala Lumpur (RM10,234) and Putrajaya (RM10,930) far exceed Sabah (RM5,745) and Kelantan (RM3,614). This implies a higher concentration of nationally-defined B40 households in lower-income states (e.g., Kelantan, Sabah, Kedah), even if each state’s own income distribution differs. For mapping and targeting, always reference DOSM’s state tables before designing programmes.
What financial challenges do B40 households face?
Thin buffers & low savings: 47% of Malaysians have difficulty raising RM1,000 for emergencies (Bank Negara’s FCI Survey). EPF data also highlight low balances among many members below 55, with median balances in the B40 member segment extremely small.
Debt service pressure: Malaysia’s household debt remains among the region’s highest (measured to GDP), so lower-income families are more exposed when interest rates or living costs rise.
Credit access: Formal microcredit helps, but financial literacy and budgeting remain critical to avoid over-indebtedness. (See the Financial Education Network resources built around BNM’s FCI Survey.)
What government policies support B40 households?
Malaysia deploys a mix of cash aid, healthcare, housing and transport measures:
Cash Aid: Sumbangan Tunai Rahmah (STR) is the flagship direct cash assistance for eligible households; check the official portal for eligibility and payment cycles.
Healthcare: PeKa B40 (MOH) offers health screening and medical assistance for eligible B40 adults, an important health access safety net. (Note: the mySalam scheme previously provided critical illness coverage but is no longer in force; refer to MOF’s archived notice.)
Housing: PR1MA targets middle-income (M40) homebuyers in urban areas; Rumah Mesra Rakyat (SPNB) helps lower-income households build affordable homes.
Transport: The My50 unlimited travel pass reduces commuting costs across Rapid KL networks, material for urban B40 budgets.
Plan alignment: The 12th Malaysia Plan (RMK-12) emphasises inclusive growth, income inequality reduction and targeted subsidies by 2030.
How does Malaysia’s B40 compare with other countries?
Malaysia’s approach, broad subsidies transitioning to targeted subsidies via PADU, contrasts with neighbours that use welfare cards (Thailand) or means-testing tools calibrated to net disposable income.
Direct cross-country “B40” comparisons are tricky because definitions, tax systems, and cost of living differ. A fairer approach is to compare poverty rates, Gini, and social protection coverage.
Malaysia’s poverty incidence was 6.2% in 2022 on the revised national poverty line, with gaps by state and ethnicity still salient in policy debates.
What are long-term solutions for B40 upliftment?
Inclusive jobs & SMEs: Focus on SME upgrading, formalisation of gig economy work, and place-based job creation in rural districts.
Education & TVET: Scale TVET and industry-certified programmes; expand scholarships/allowances for B40 students.
Financial literacy & buffers: Use the FCI Survey toolkit to design financial literacy programmes that improve savings and reduce debt stress.
Targeted subsidies: Continue the shift from blanket subsidies to PADU-enabled, needs-tested assistance.
Micro-entrepreneurship: Facilitate microbusinesses with training, e-commerce onboarding and digital payments acceptance.
What is the future of income classification in Malaysia?
Malaysia is transitioning away from blanket B40/M40/T20 labels in subsidy targeting toward net disposable income (NDI) using the PADU database (which integrates data from 200+ agencies and >30 million profiles).
Policymakers and researchers (e.g., KRI) have also discussed more granular splits like B20/M50/T30 to better reflect vulnerabilities. Treat these as policy developments in progress; check official updates before making eligibility claims in your content.
Comparison Table
Group | Monthly Income (RM) | Share of Households | Key Expenses | Major Challenges | Support Programs |
B40 | ≤ 5,249 | 40% | Food, housing & utilities, transport | High debt servicing, low savings, inequality | STR, PeKa B40, My50 |
M40 | 5,250 – 11,819 | 40% | Housing, education, transport | Inflation, stagnant real wages, childcare & tuition costs | Tax reliefs, PR1MA |
T20 | ≥ 11,820 | 20% | Education, investments | Progressive tax changes, subsidy rationalisation | _ |
T15* | ≥ ~15,000 | ~15% | Investments, higher education outlays | New taxes, fewer universal subsidies | _ |
* T15 is a policy shorthand, not an official DOSM category.
B40 Mapping Malaysia (State Lens)
Lower-income states like Kelantan (median RM3,614) and Sabah (median RM4,577) have a higher concentration of households falling under national B40 thresholds.
High-income urban areas (KL, Selangor) still host many B40 households because living costs and housing prices eat into disposable income. Use DOSM state tables for targeting and avoid assuming urban = affluent or rural = poor.
Government & NGO Support : Quick Links
Department of Statistics Malaysia (DOSM) – HIES 2022 (median income): essential for household income reporting.
DOSM – HES 2022 (expenditure shares): use to frame cost of living and basic amenities.
Household income percentiles (including B40 threshold): deeper income breakdown and percentiles.
PeKa B40 – Ministry of Health: health screening and benefits overview for B40 adults aged 40+.
PeKa B40 scheme overview: public–private primary care partnership with screening, device subsidies, cancer and transport incentives.
PR1MA – Affordable modern homes for middle-income Malaysians (RM 2,500–RM 15,000/month income)
SPNB Rumah Mesra Rakyat – Housing for lower-income households (household income RM 750–RM 5,000/month)
Rapid KL My50 Pass – RM 50/month unlimited rides on LRT, MRT, Monorail, BRT, Rapid KL buses (30 days)
MyDIGITAL (Digital Economy Blueprint) – National digital economy transformation agenda launched in 2021 with goals through 2030
Yayasan Hasanah – Impact-driven foundation for community development, education & sustainability
MyKasih Foundation – Cashless food aid, student bursaries, financial literacy, and health programmes for B40 households
MERCY Malaysia – NGO providing humanitarian and medical relief for vulnerable communities in crisis and non-crisis situations
Food Aid Foundation – Malaysian food bank redistributing surplus food to low-income families, welfare homes, and refugees
Final Words
B40 refers to the bottom 40% of households by income, with the latest benchmark from the HIES 2022 survey being ≤ RM5,249. The previous cut-off was RM4,850.
The cost of living burden, especially housing/utilities, food, and transport, constrains savings, leaving households vulnerable to shocks.
Targeted subsidies (via PADU/NDI), TVET, education scholarships, and NGO programmes provide support today, while long-term resilience hinges on skills, digital access, and financial literacy.
(FAQs)
How many households are in B40?
By definition, 40% of households. In absolute numbers, it fluctuates with population growth and household formation; consult DOSM for the most recent household count.
What percentage of Malaysians live in poverty?
Using Malaysia’s revised national poverty line, absolute poverty was 6.2% in 2022. Poverty and income inequality vary by state and demographics.
Which states have more B40 households?
States with lower median incomes, such as Kelantan and Sabah, contain higher concentrations under the national B40 threshold. KL/Selangor also have many B40 due to high living costs.
What are the biggest challenges for B40 families?
Living costs (housing, transport, food), low savings (many struggle to raise RM1,000), and debt servicing risks. Access to education, healthcare and digital tools is decisive for mobility.
What programmes help B40 healthcare access?
PeKa B40 provides screenings and health benefits for eligible adults. (The previous mySalam scheme has ended.)
Do NGOs provide support for B40?
Yes, Yayasan Hasanah (education & community), MyKasih (food), MERCY Malaysia (health), Food Aid Foundation (urban food bank).
How does Malaysia’s B40 compare with Indonesia or Thailand?
Don’t compare raw income ranges. Compare poverty measures, subsidy design and safety nets. Malaysia is shifting to NDI/PADU targeting to reduce inclusion/exclusion errors.
What is PADU’s role in B40 classification?
PADU centralises data for targeted subsidies. Policymakers plan to prioritise net disposable income (after essential costs) over blunt B40/M40/T20 labels for eligibility decisions.
Will Malaysia move away from B40/M40/T20?
Yes, for subsidy targeting, the government has signalled a shift to NDI/PAKW criteria, with B20/M50/T30-style granularity discussed in research (e.g., KRI). Always verify current rules before publishing.