The signs of online payment service providers GrabPay and Momo displayed at a food store on Tran Hung Dao Street, Hanoi (Source: VNA) Hanoi (VNS/VNA) - Telecommunications firms areready to pilot a mobile money service thanks to their modern technologyinfrastructure, customers, wide transaction point networks and financialresources.
Prime Minister Nguyen Xuan Phuc has directed the Ministry of Information and Communicationsin co-ordination with the State Bank of Vietnam to develop a mobile moneyproject.
The scheme will permit telecommunications firms to pilot a mobile money servicenot linked to consumers’ bank accounts.
He noted that the mobile money service together with banks aimed to acceleratethe development of e-payments in the country.
Minister of Information and Technology Nguyen Manh Hung in a meeting last weeksaid digital technology would create new business models and challenges orreplacing the old ones.
“Allowing mobile phone accounts to implement payment would promote non-cashpayment to all people. However, this could be a challenge for banks. The issueis whether the Government would accept the new business model or not,” Hungadded.
Responding to the move, telecoms providers have prepared to supply theservices.
MobiFone is one of three firms to submit an application to the central bank tolaunch mobile money. It said mobile money allows customers to transfer moneyusing mobile phones. The service therefore could serve people without bankaccounts, especially those in remote and mountainous areas who lackopportunities to access financial services.
A representative from MobiFone said mobile money would support Vietnam’se-payment system and digital transformation, and be an important component forthe Fourth Industrial revolution.
Earlier, VNPT Vietnam Posts and Telecommunications Group (VNPT) at its meeting with deputy PM Vuong Dinh Hue in February, asked for permissionto launch a mobile money service. It confirmed it is ready to pilot theservice.
Tran Manh Hung, VNPT’s chairman, said mobile money had been a commondevelopment trend globally.
VNPT had strength in science and technology, a wide telecoms network nationwideand a large number of mobile phone users, making it capable of developing anon-cash payment system.
“VNPT is ready in terms of capital, with enough charter capital to establish abank,” Hung said.
Le Dang Dung, acting chairman of Viettel said the group also submitted aproposal to the Government to participate in developing digital payment.
“Mobile money contributes to developing non-cash payment in Vietnam and bettermeets with the increasing demands of customers. It is suitable for people inrural and remote areas who have less access to traditional banking services,”he said.
Pham Trung Kien, Viettel Telecom’s deputy general director, said Viettel mustdevelop different services to allow groceries, car parking and coffee shopsaccept payments through mobile phones.
Mobile money would be a big opportunity for telecom firms to have breakthroughdevelopment and fully exploit their transaction networks and science andtechnology foundation.
E-payment has been on the rise in Vietnam in recentyears. The Vietnamese fintech market is set to reach value of 8 billion USD in2020. Digital payment solutions account for 89 per cent of the fintech marketin Vietnam, while individual and business financial areas are also forecast tohave growth rates of 31.2 percent and 35.9 percent respectively by 2025.
Governments across Southeast Asia are pushing aheadwith efforts to create cashless economies, with less developed countries suchas Vietnam and Thailand leapfrogging richer ones like Singapore and Malaysia inelectronic payments, Nikkei Asian Review reports.
Vietnam and Thailand are experiencing a boom in mobile payments as more peopleuse e-wallets to pay for goods and services without going through banks, itsays.
Vietnam has been promoting electronic payments since 2008. Only about 40 percent of the country’s 95 million people have bank accounts, mostly in urbanareas, while there are around 120 million mobile phone subscriptions.
Nikkei says local information technology and telecom companies, including VNPT,Viettel and FPT, have introduced e-wallets and encouraged people to put awaytheir cash. But none had made much headway until recently.
Now things are taking off, with the number of people making mobile payments instores growing faster in Vietnam than elsewhere in Southeast Asia, according toa recent PwC report. The percentage of consumers in Vietnam using mobile paymentsincreased from 37 percent in 2018 to 61 percent in 2019.
"Mobile payment services also are gaining widespread acceptance,especially in emerging regions that have leapfrogged past landline-basedtelephone systems and gone straight to mobile and smartphones," the reportsays.-VNA/VNA
