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Vietnamese Government Approves Trial Use of Mobile Money

Image credit: Ministry of Information and Communications

The country’s Prime Minister had agreed to implement mobile money services on a trial basis earlier in March. The time for trying the service is two years from the date it was licensed. To register mobile money services, clients need to show ID cards/passports with the information coinciding with the information in their registered mobile phone subscription and get identified by licensed service providers.

According to a press release, mobile subscribers must have continuous use of at least three months by the time they register for the mobile money service. Tran Duy Hai, Deputy Director of the Authority of Telecommunications, said the agency prepared the plan to apply for mobile money on a trial basis when ministries were awaiting the PM’s nod on the pilot implementation.

In early April, the agency assigned its staff to join forces with relevant units in MIC, referring to the PM’s Decision No 315 and other countries’ experience, to guide businesses to draw up plans and submit to the State Bank for permission to provide Mobile Money service. The agency also asked businesses to prepare solutions, facilities, technological infrastructure, workforce, and policies to be able to deploy the service soon after getting the central bank’s approval.

A report showed that over 50% of the Vietnamese population still do not have bank accounts. Many people are excluded from the formal financial system, especially the poor in rural areas and people in remote areas. Mobile money can help them access paid services on the Internet, including healthcare, education, finance, jobs, and social security. Mobile money is expected to penetrate the rural market and digitise the agricultural value. In developing countries, about 15% of adults have revenue from selling farm produce, but they receive cash, which is a risky, ineffective, and inconvenient payment method.

Mobile money will provide the clients who don’t have bank accounts with one more transaction channel. This will help increase the non-cash payment ratio as requested by the government. Thanks to mobile money, citizens in rural parts of the country will have the chance to experience convenient shopping with fast and accurate payments, suitable for small transactions, the press release noted. The Chair of the Vietnam Internet Association, Vu Hoang Lien, claimed that mobile money would bring a lot of benefits to consumers and society. If mobile money gets licenses soon, it will be the first government’s sandbox to make a breakthrough and strong motivation for new technologies and services to be brought into society, he said.

OpenGov Asia had earlier reported that the launch of mobile money would promote the non-cash payment ecosystem while bringing convenience to people, especially those in rural areas. As local people are gradually adapting to online transactions during the COVID-19 pandemic, the deployment of mobile money will be an appropriate action to promote cashless payments.

The government also announced its plans to make most public services and processes electronic. It aims to go completely digital by 2025. Over the past few years, the building and deployment of e-government architecture and platforms have achieved significant results. In fact, all ministries, ministerial-level agencies, provinces, and cities had deployed local/national government service platforms (LGSP) by the end of 2020, from just 3.2% of ministries and localities in 2018.

Further, by the end of 2020, all ministries and localities had portals to provide online public services. More than 55% of public services were provided online at level 3 or 4, allowing citizens to submit documents and pay online. The percentage of public services at level 4 increased from 1.42% in 2016 to 30.86% in 2020.

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