Cashless payment rising in Vietnam and its growth prospects

Cashless usage is stated to have increased by a Visa's study, and the number of e-payment in Vietnam is forecasted to grow by 2020 according to the Asian Post, which is the sign of digital payment development.

Lonicera Vu

May 24, 2020 | 14:35

cashless payment rising in vietnam and its growth prospects

Ha Noi encourages cashless payment, e-commerce

Online payments flourish in Vietnam during COVID-19

Ha Noi encourages cashless payment, e-commerce

According to Visa, E-Commerce spending in Vietnam has increased by 40 percent over the past year. A Visa’s Consumer Payment Attitudes study found that the number of respondents in Việt Nam saying they have used in-app mobile payments increased to 44 percent last year. This study also found that those saying they had tried contactless card payments increased to 32 percent, and QR payments 19 percent.

According to the Hanoi Times, the current internet and smartphone penetration as well as social media users in Vietnam are higher than the global average. This has impacted on the percentage of consumers using mobile payments, increasing from 37% in 2018 to 61% in 2019, with the number of people making mobile payments in stores growing faster in Vietnam than elsewhere in Southeast Asia, according to a recent PwC report.

According to Statista, in 2017, the number of e-payments in Vietnam grew by 22 percent from the previous year and was valued at US$6.1 billion. This figure is forecasted to grow to US$12.3 billion by 2022, reports the Asian Post.

According to the Hanoi Times the increasing internet adoption, evident by Vietnam’s 140 telecommunication subscribers per 100 people, and the nearly 60 million subscribers of 3G and 4G. In fact, 99% of districts and wards have 4G coverage. As such, this number is expected to increase to 80 million subscribers in 2020.

The Deputy Prime Minister said this is an ideal environment to facilitate e-payment, as well as other financial and e-commerce services across the country, which brings benefits for enterprises and all Vietnamese while facilitating the way for a cashless society.

Earlier this year, the government approved a project on increasing the use of cashless payments for public services. By 2020, the government expects the ration for cashless payments for the following services to be:

· Social Welfare payments 20%

· Hospital fees (major cities) 50%

· Electricity & Water payments 70%

· University tuitions 70%

· Tax payments 80%

Bùi Sỹ Lợi, Vice Chairman of the National Assembly’s Committee on Social Affairs, said that the government is keen to promote cashless payments. By limiting the amount of cash in circulation, the government lowers its costs for the printing and management of cash, which in turn, makes the government more efficient.

With the encouragement of the Government along with the development of modern technology and the retail sector, digital payment growth is expected to be dramatically increased in the future.