Malan dropped from a full deal to an incremental one in the ECB's new set of central contracts announced on Tuesday. The increment contracts recognise players who may feature for England on a less predictable basis.
"It's a slightly strange system," said Malan, who scored 82 from 49 balls as England beat Australia by eight runs in their T20 match on Wednesday.
"It seems heavily led towards red-ball cricket. Ultimately it puts you in tough situations if you're not contracted because you're losing finances you'd get if you were playing in (franchise) tournaments."
Chris Jordan (34), who previously had an increment deal, was not awarded a contract of any kind despite being England's leading wicket-taker of all time in men's Twenty20 Internationals.
Jordan and Malan are part of the England squad taking on Australia in a three-match series in the build-up to the T20 World Cup.
"You have players here who have been leading wicket-takers for England that don't have a contract, but those are decisions that I don't make," said Malan. "As players, we'd like to be rewarded for our performances for England."
England begin their World Cup campaign against Afghanistan in Perth on October 22nd.