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Mobile Money Services in Vietnam Help Bridge Technological, Geographical Divides

By the end of March, more than 1.1 million people had registered and were using Mobile Money in Vietnam. Of the figure, about 60% (660,000) of users are in rural, mountainous, remote, border, and island areas. Over 3,000 business points accept money through the digital service. The number of establishments in remote areas accounts for 30% (900). There have been more than 8.5 million transactions registered on Mobile Money with a total value of over VNĐ370 billion (US$16 million).

In deploying Mobile Money, the government has taken advantage of existing infrastructure and data and telecommunications networks. This has reduced social costs and expanded cashless payment channels on mobile devices. At a recent event, the Deputy General Director of the Viettel Digital Services Corporation noted that the COVID-19 pandemic highlighted the need to universalise digital payments. Regardless of an Internet connection or bank account, and with just phone numbers, users can easily make cashless transactions through their Mobile Money account, he said. In fact, the pandemic greatly boosted the e-commerce market, with non-cash payments accounting for 70% of total retail transactions in Vietnam last year. Even in the new normal scenario, Mobile Money plays an important role in expanding trade opportunities for everyone, bridging geographical and technological divides.

As 40% of the Vietnamese population does not have a bank account, Mobile Money also enables the government to carry out support activities for people in remote areas such as distributing subsidies, social security funds, and loans to facilitate economic development. The Viettel representative suggested that the government should speed up disbursement activities and support production and business operations for disadvantaged groups through Mobile Money.

Furthermore, state management agencies must work out support policies to build and further replicate non-cash payment models across the country, allowing all citizens to access and accept digital payments as a familiar and convenient form of spending. The government believes that Mobile Money will contribute to the development of a comprehensive financial system in the country and will help make non-cash payments a habit of the people.

As OpenGov Asia reported last week, cashless payment methods like contactless cards, QR codes, and mobile banking for digital and e-commerce services are becoming increasingly popular in Vietnam. The country hopes that by 2025, the volume of mobile payment transactions will grow by 50-80% while transaction value will surge by 80%-100% annually. It also aims for at least 80% of the population aged 15 and above to have bank accounts, the number of Internet payments to increase by 35%-40% annually, and the rate of individuals and organisations using cashless payments to reach 40%.

The proportion of adults using smartphones in Vietnam is 73.5%, and the government aims to increase the rate to 85% by the end of 2022, according to the draft National Digital Infrastructure Strategy to 2025. To achieve this, 8.6 million of the 10 million people using feature phones would need to shift to smartphones. Data from the Department of Telecommunications showed that by the end of 2021, Vietnam had 91.3 million smartphone subscribers. By March this year, there were an additional two million subscribers, bringing the total number to 93.5 million.

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