The State Bank of Vietnam (SBV) has submitted a proposal to the Government on piloting mobile money services in the country and if approved, this is hoped to further boost the country’s non-cash payment rate.
Despite much improvement, Vietnam’s cash transactions rate is still astonishingly high, at around 90%. While there has been a boom of e-wallet services providers in the country, e-wallets in Vietnam thus far have to be linked with a bank account. This automatically excludes about half of the population that current do not have access to bank accounts.
Now, two of the country’s biggest telecom providers, Viettel and Vinaphone, have been given the green light to roll out mobile money services once the pilot project is approved.
In contrast to the bank-account linked e-wallets already available in the country, mobile money accounts would allow users to pay up cash to store value for future purchases via their phones. And mobile money does not necessarily require to be transferred via the internet.
Nghiem Thanh Son, deputy director of the Payment Department at SBV, said at a recent event on the country’s fintech regulatory environment, that the State Bank will consider allowing the same limit for direct cash top-up for mobile money and e-wallets to ensure fairness for both e-wallet and mobile money providers.
As Vietnam’s fintech market is predicted to be worth USD 7.8 billion by 2020, mobile network operators in the country do not want to be left out of this race and have the advantage of being able to reach users in the rural areas. In Vietnam, the number of mobile phone subscribers reached 134.5 million for the first six months of this year.
Globally, about 90 countries in the world have implemented mobile money, with 866 million registered accounts and USD 1.3 billion in transactions every day, according to a report by the GSM Association, a trade body that represents the interests of mobile network operators worldwide.