Vietnam's e-payment market attracts foreign giants

Vietnam is currently one of the most potential e-payment development markets in the region and attracts the attention of foreign giants.

In August 2015, Samsung launched an electronic payment service called Samsung Pay, allowing users to pay with the company's mobile devices at credit card-enabled machines. This product has been launched in Korea and the US, but the giant has also shown interest in emerging markets, including Vietnam - one of Samsung's production centers and home to a large smartphone user community.

Sony, though less dominant in the smartphone segment, is also focusing on mobile payment technology. With its target product, Felica, which uses a chip built into a phone or attached to a plastic card, the Japanese technology company plans to deploy contactless payment technology for public transportation across Asia.

Electronic payment via mobile devices is the method chosen by many big companies. Photo: Trustedreviews

After Japan, Hong Kong (China) and Indonesia, the company representative said that Vietnam could soon be the next destination to deploy the bus payment card system in some major cities, after the Japanese government provided 200,000 cards as part of a development aid plan in this country.

In addition, other payment tools such as Apple Pay, Android Pay or LG's digital payment platform... are also promising to be deployed in the Vietnamese market in the near future.

According to experts, the development of e-commerce and online public services is the driving force behind the development of e-payments, attracting foreign investors to Vietnam. "Data on the number of people owning smartphones is an interesting basis for expecting a rapid acceptance of new payment technologies in Vietnam," commented Mr. Sean Preston, Visa Country Manager for Vietnam, Laos and Cambodia.

According to the Ministry of Industry and Trade, 40% of Vietnam's population is using the internet, most of whom use smartphones to access. Notably, 60% of mobile subscribers are using their phones to make online purchases. The latest study by Ken Research shows that total revenue from e-commerce activities in Vietnam will reach 7.5 billion USD in 2019, compared to the current level of about 4 billion USD.

"We are witnessing a strong development of the e-commerce sector as Vietnamese consumers are gradually responding to the convenience, competitive prices, and diversity of goods sold online," said Mr. Preston. At Visa alone, he noted that e-commerce transactions using the company's products achieved an annual growth rate of up to 44% - the highest in the region. The market penetration of e-commerce in Vietnam also reached 18%, the highest compared to other competitors in the region.

Electronic payment is not only limited to online shopping for consumer goods between individuals and between individuals and businesses, but also includes a large volume of transactions between individuals or businesses and state agencies in paying for services such as electronic invoices, paying taxes, registering and renewing licenses, etc.

"Vietnam is one of the most potential markets for developing electronic payments compared to other countries in Asia due to factors such as: a country with high consumption, a rapidly growing population and economy, and the majority of people still using cash in payments," said Mr. Tomoaki Yamaguchi - Chief Representative - Country Director of JCB International (Thailand) Co., Ltd Representative Office in Hanoi.

Sharing the same view, Ms. Virginia Foote - President of the American Chamber of Commerce in Hanoi commented that Vietnam is a promising destination for foreign companies in the field of electronic payments. "Cashless payment is very popular in the world, especially mobile payment platforms. The global electronic payment market itself is growing rapidly and Vietnam is developing more and more," she said.

However, foreign investors also suggested that management agencies need to establish specific and timely policies for cashless management solutions to develop favorable market conditions and bring benefits to people in both urban and rural areas.

According to VNE