A customer pays for a drink by QR code at a tea shop (Photo: VNA) Hanoi (VNS/VNA) - E-wallet firm MoMo launched a cashback programme on November 3 withvalue of up to 100,000 VND (4.30 USD) per transaction and for four transactionsdaily at most.
The company said themove follows the success of its first cashback programme in August, which hadto wrap up earlier than planned due to overwhelming demand.
This is one ofvarious promotion programmes banks and payment solution companies are offeringto attract Vietnamese users to quick response (QR) code payment.
A QR code is similarto a bar code and made up of black and white squares that can be read byvarious devices, including smartphones and point of sale (POS) terminals.
For years, companieshave been using QR codes for multiple purposes, from advertising and promotionsto merchandise tracking and coupons. QR codes have also started to be used forpayments, with customers scanning a QR code and having the money transferredfrom their account to the merchant, without the need for a POS terminal.
Vietnamese customersare increasingly familiar with QR code payments, with large firms such asVietnam Airlines, Vietjet Air, Co-opmart, Lotte Mart, petrol retailer PV Oiland a lot of convenience stores, food-beverage and clothes shops.
In Vietnam, 24 banks,including State-owned banks such as Vietinbank, Vietcombank and BIDV, haveoffered QR code payment services, not to mention other industry players such asfintech and e-wallet firms.
The number ofmerchants accepting QR code payments increased to 50,000 by mid-2019 from30,000 at the end of last year.
Costly investment
In recent months,many banks and e-wallet firms have launched promotions to attract customers tomake payment via QR code. Accordingly, if customers pay for products byscanning QR codes instead of cash or cards, they will enjoy a 10-20 percentdiscount or be awarded cashback.
Trinh Thi My Kim, ateacher in Hanoi, said that she recently installed MoMo after her friendintroduced her to the promotion programmes offered via the e-wallet.
“Previously, I onlyused QR payments on mobile banking for food or clothes because of pricediscounts. Now I added MoMo for its cashback in many stores,” Kim said.
Kim and others areusing several e-wallet apps and they switch to different apps depending on theproducts and promotion programmes.
Besides banks, somee-wallet firms are dominating the cashless payment industry such as MoMo, Moca,ZaloPay, Viettel Pay and Payoo.
MoMo has teamed upwith 20 banks and 10,000 partners in various sectors like power,telecommunications, insurance, entertainment, e-commerce and food andbeverages, and has some 12 million users.
Moca, through apartnership with Grab, has also witnessed an impressive increase in the numberof users, with the total number of non-cash payment transactions via Moca onGrab rising 150 percent in the first half of this year.
In September,Vingroup also launched VinID e-wallet. With a broad range of products andservices from shopping, medicine to education and resorts, VinID is expected tobecome a big player in the industry.
According to Pham CongQuynh Lan, deputy general director of Vietinbank, e-wallets have poured a lotof money into promotions to entice users but most only switch to this methoddue to the promotions.
“The number offrequent users has increased slowly. When the promotions end, they go back tocash,” Lan was quoted as saying by baodautu.vn.
However, according toindustry experts, QR code payment is still at an early stage and serviceproviders need to spend a lot to establish a habit for users. Promotion fundsare often shared by both service providers and merchants.
“The advantages of QRpayment are low cost investment and rapid deployment time, which makes itsuitable for small-scale service providers, mobility services, or taxibusinesses,” Dang Tuyet Dung, Visa Country Manager for Vietnam and Laos,told Vietnam News.
However, Dung saidpaying with QR code is reliant on internet infrastructure in terms oftransmitting transaction information to the accepting unit, not to mention thatthis method’s processing speed is not as fast as contactless payment.
According to Visa’sreport about Southeast Asia payment attitudes in 2018, only 19 percent of theVietnamese respondents have used a QR code to pay.
“Generally, it willtake time for the consumers to get acquainted with this new method,” Dung said.
Another problem facedby dozens of service providers is that users rarely use more than three paymentapps on their phone. This means the battle to attract users will be fiercer inthe future, with 70-80 percent of e-wallets expected to be eliminated.
In China, a leader interms of cashless payment, two payment applications supporting QR code payment– Tencent's WeChat Pay and Alibaba's Alipay – have a respective 900 millionusers and 500 million users. In addition, AliPay and WeChat Pay have integratedmany different services into their mobile wallets.
Thus, local existinge-wallets are forecast to spend more and more money on promotions to seek theloyalty of customers, as well as to expand their network to increaseconvenience for users./.
VNA
