90% of Vietnamese spending is still in cash.
(Baonghean) - According to data from the World Bank, about 50% of the Vietnamese population has a bank account, but up to 90% of daily spending is still in cash, 99% use cash when paying for items under 100,000 VND and up to 80% of transactions at ATMs are cash withdrawals.
INITIAL RESULTS
In Nghe An, after the Government and the State Bank issued a system of documents on non-cash payments, the Provincial People's Committee directed relevant departments, branches and units to promptly deploy and promote non-cash payment activities in the area.
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| The habit of paying via the Internet is gradually forming among young people. Illustration photo |
Nghe An currently has 266 ATMs, 1,547 POS, most of the units receiving State budget salary in Vinh city and some district and town centers have made salary payments through accounts. Currently, there are over 2,098 units in Nghe An making salary payments through accounts, of which over 1,396 units receiving State budget salary make salary payments through accounts. The number of cards in circulation is 1,368 thousand cards, the average POS payment turnover is 77 billion VND/month.
According to Nghe An statistics, there are currently 10,188 businesses registering accounts to pay taxes electronically. Tax collection transactions at banks are 3,500,031 items with a total amount of VND 151,272 billion. For electricity bill collection services, the total electricity bill collection through banks is 951,745 items, with a total amount of VND 2,286 billion. Water bill collection services through banks are 6,807 items, with a total amount of VND 7 billion.
Particularly in Nghe An province, banks have proactively coordinated with units (universities, colleges, hospitals, etc.) to issue co-branded cards such as ATM cards that are also student cards, parking cards, medical examination cards, etc.); with approximately more than 16,000 cards issued.
NEED TO CHANGE HABITS
The changes in non-cash payments in Nghe An are remarkable, but according to general assessment, cash is still the main means of payment today. Especially in small traders, small and micro enterprises, non-cash payments have not received much attention.
There are many reasons for this situation, the most notable of which is the habit of people spending money in cash. Businesses and people still spend money in cash because this payment method is fast, convenient, uncomplicated and accepted everywhere.
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| People still mainly use ATM cards to withdraw cash instead of paying at POS machines. Photo: Viet Phuong |
Another reason is that the infrastructure system has not met the demand. The number of ATMs and POS machines installed is mainly in urban areas and concentrated in supermarkets, shopping malls, restaurants, hotels, etc., while in rural and mountainous areas, there are very few, so people still have to pay in cash.
“Some financial products and services have not been designed to suit the behavior and needs of the majority of users, especially users in rural areas, especially digital financial services and payments via mobile phones."
In addition, many people are still hesitant to approach new payment technologies, worried about security and safety. The complicated developments of high-tech crime, especially cases of customer accounts being hacked, seized, etc. in recent times have also partly affected many people when using online payment services through banks. |
| Shopping activities at a supermarket in Vinh City. Photo: Viet Phuong |
According to the State Bank's expert opinion, to develop non-cash payments, it is necessary to help each citizen clearly understand the benefits of this payment method; help them feel safer, more convenient and comfortable when using the service.
Along with that is to perfect the banking transaction processing process towards digitalization, automation, safety and convenience. Combining banking and telecommunications to develop, apply modern, easy-to-use payment and money transfer means and models (payment via mobile phones, digital devices, etc.) to promote non-cash payments not only in large cities but also in rural areas, remote areas, islands and even for those who do not have bank accounts, on the basis of using the existing network of credit institutions, postal networks, networks of organizations providing intermediary payment services, and some other non-bank organizations.
By 2020, Nghe An aims to:
80% of tax payment transactions in Vinh city are made through banks; at the Provincial State Treasury, the Treasury in Vinh city, Cua Lo town, Thai Hoa town, Hoang Mai town have equipment to accept bank cards to serve the State budget collection;
70% of units under Nghe An Electricity accept payment of electricity bills through banks, striving for 70% of electricity bill payments through banks in Vinh City, Thai Hoa Town, Hoang Mai Town, and Cua Lo Town;
70% of water companies accept payment of water bills via banks, striving for 50% of individuals and households in Vinh City to pay water bills via banks;
100% of universities and colleges, 80% of students at universities and colleges pay tuition fees through banks;
Strive for 50% of hospitals in Vinh City to accept payment of hospital fees through banks; strive for 20% of social security payments in Vinh City, Cua Lo Town, Thai Hoa Town, and Hoang Mai Town to be made through banks.
According to statistics from the Ministry of Industry and Trade, in the past 5 years, the e-commerce sector has grown at a rate of 25 - 30% per year with the total value of e-commerce transactions in 2018 reaching 8 billion USD. However, the main payment method is still cash, only 3 - 5% of transactions use non-cash payments, with the rate of online payments accounting for a very low proportion, up to 80% of customers still use the method of receiving goods and paying (COD).
