Vietnam: Calls for cashless payments to take-off in Viet Nam

• The prolonged COVID-19 pandemic has unexpectedly created “golden” conditions for the financial industry to accelerate digital transformation and shift to cashless payments.
• However, mobile payments need to be implemented soon to reduce the disparity between urban and rural areas. They can also be an effective payment channel in supporting people in remote and isolated areas.
• In addition to online shopping, people can also pay for their electricity, water, telecoms and even hospital fees through banking accounts or e-wallets.
• Cấn Văn Lực, a banking and finance expert, said since the outbreak of COVID-19 in early 2020, the number and value of transactions through non-cash payment methods have increased sharply compared to the previous period.
• In the 1H21, non-cash payments increased by 30-40% in transactions and by 70-80% in value.
• Despite the sharp increase, it was undeniable that cash payments were still popular in Việt Nam because consumption habits as well as payment coverage had not reached rural and remote areas, Lực said.
• The Government in Mar 21 approved pilot application for Mobile Money, which allows the use of mobile-phone credit to pay for small-value goods and services.
• The pilot application for mobile money services aims to contribute to the development of non-cash payments, improving the access and use of financial services, especially in rural, remote, border and island areas.
• However, more than five months since issuing the decision, Mobile Money has not been implemented, largely due to the prolonged impact of COVID-19.
• According to Tú, if Mobile Money is exploited, it would make a change and upgrade society, reducing the gap between urban and rural areas. People in rural areas could sell their products through payment tools and e-commerce.
• However, experts have also said the development of Mobile Money or non-cash payment methods in Việt Nam still faces many challenges. The most important thing now is to change people’s consumption habits through financial education programmes as a pillar in implementing a comprehensive financial development strategy.

External Link : https://vietnamnews.vn/economy/1020311/calls-for-cashless-payments-to-take-off-in-viet-nam.html