Vietnam Accelerates Development of Digital Payments

Financials Author: EqualOcean News, ChenZhiheng Jun 14, 2024 09:00 AM (GMT+8)

A study on consumer payment attitudes in 2023, released not long ago by credit card company Visa, shows that Vietnam's digital payment transactions will amount to about US$24 billion in 2023, ranking fourth in Southeast Asia. The magazine Industry and Trade, under the Ministry of Industry and Trade, expects Vietnam's digital payments to grow at a compound annual growth rate of 22.8% from 2022 to 2025, with transaction value reaching US$28 billion in 2025.

Currently, digital payment methods in Vietnam mainly include e-wallets and QR code payments, according to Visa. According to the State Bank of Vietnam, by the end of 2023, the number of e-wallets in regular use in Vietnam was 36.23 million, accounting for 63.23% of the total number of activated e-wallets, and the total amount of funds in e-wallets was about VND2.96 trillion (1 yuan is about VND3,507). A survey by UOB showed that four out of every five Vietnamese consumers use e-wallets to make payments at least once a week. Among them, MoMo, ZaloPay and VNPay are the e-wallets used more frequently.

Vietnam's young demographics and high internet and smartphone penetration are favorable factors for the country's development of digital payments. According to the General Statistics Office of Vietnam, the country has a population of more than 100 million with a young demographic structure. The Ministry of Information and Media of Vietnam introduced that the current 4G network coverage rate in Vietnam is 99.8% and the smartphone penetration rate is 84%.

To accelerate the development of digital payments, Vietnam has launched a number of initiatives. In 2022, Vietnam released the “2025 National Development Strategy for the Digital Economy and Digital Society and Vision 2030”, which puts the development of information technology and the fostering of digital economy enterprises and products as key objectives, promotes the construction of a unified digital platform for all sectors and industries, and carries out basic digital skills training for 70% of the country's working population. Training. In February this year, the Ministry of Information and Media announced the “2030 Information and Communication Infrastructure Plan and Vision 2050”, striving to upgrade the nation's broadband network infrastructure by 2030 to ensure that all users can access the Internet with a speed of more than 1GB per second. In addition, Vietnam has introduced laws and regulations to strengthen the regulation of the digital payment sector to ensure the stability and security of the national payment system.

The Vietnamese government is also actively encouraging innovation among fintech enterprises and continuously improving digital technology facilities. According to Vietnam's Banking Times, at present, the number of fintech enterprises carrying out digital payment business in Vietnam has increased from 39 in 2015 to nearly 200, and there are more than 40 suppliers who have built digital payment systems with banks, with digital payment application scenarios covering many areas of people's livelihood. This year, Vietnam's relevant authorities are accelerating the issuance of 5G licenses. According to the plan, Vietnam's 5G network will cover 99% of the population by 2030. In addition, with the support of the Vietnamese government, commercial banks have also increased investment in digital infrastructure.

The development of digital payments has made Vietnamese people feel convenient. Nguyen Thi Hoa, a university student in Hanoi, told reporters that digital payment scenarios are getting richer and richer, and in addition to paying utility bills, ordering takeaways, buying tickets and air tickets can also be done on cell phones. “Digital payments have also improved efficiency and driven the digital transformation of the whole society.”

To address the growing problem of information security in the popularization of digital payments, Pham Inh Thuy, Director of the State Bank of Vietnam's Payments Department, said digital payments must be promoted in tandem with ensuring information security, and that the State Bank will regularly review, revise and strengthen measures related to ensuring information security, supervise payment service providers to ensure information security, and clamp down on the use of payment services for fraudulent purposes.