Telecoms firms ready for mobile money service
Hanoi (VNS/VNA) - Telecommunications firms are
ready to pilot a mobile money service thanks to their modern technology
infrastructure, customers, wide transaction point networks and financial
resources.
Prime Minister Nguyen Xuan Phuc has directed the Ministry of Information and Communications
in co-ordination with the State Bank of Vietnam to develop a mobile money
project.
The scheme will permit telecommunications firms to pilot a mobile money service
not linked to consumers’ bank accounts.
He noted that the mobile money service together with banks aimed to accelerate
the development of e-payments in the country.
Minister of Information and Technology Nguyen Manh Hung in a meeting last week
said digital technology would create new business models and challenges or
replacing the old ones.
“Allowing mobile phone accounts to implement payment would promote non-cash
payment to all people. However, this could be a challenge for banks. The issue
is whether the Government would accept the new business model or not,” Hung
added.
Responding to the move, telecoms providers have prepared to supply the
services.
MobiFone is one of three firms to submit an application to the central bank to
launch mobile money. It said mobile money allows customers to transfer money
using mobile phones. The service therefore could serve people without bank
accounts, especially those in remote and mountainous areas who lack
opportunities to access financial services.
A representative from MobiFone said mobile money would support Vietnam’s
e-payment system and digital transformation, and be an important component for
the Fourth Industrial revolution.
Earlier, VNPT Vietnam Posts and Telecommunications Group (VNPT) at its meeting with deputy PM Vuong Dinh Hue in February, asked for permission
to launch a mobile money service. It confirmed it is ready to pilot the
service.
Tran Manh Hung, VNPT’s chairman, said mobile money had been a common
development trend globally.
VNPT had strength in science and technology, a wide telecoms network nationwide
and a large number of mobile phone users, making it capable of developing a
non-cash payment system.
“VNPT is ready in terms of capital, with enough charter capital to establish a
bank,” Hung said.
Le Dang Dung, acting chairman of Viettel said the group also submitted a
proposal to the Government to participate in developing digital payment.
“Mobile money contributes to developing non-cash payment in Vietnam and better
meets with the increasing demands of customers. It is suitable for people in
rural and remote areas who have less access to traditional banking services,”
he said.
Pham Trung Kien, Viettel Telecom’s deputy general director, said Viettel must
develop different services to allow groceries, car parking and coffee shops
accept payments through mobile phones.
Mobile money would be a big opportunity for telecom firms to have breakthrough
development and fully exploit their transaction networks and science and
technology foundation.
E-payment has been on the rise in Vietnam in recent years. The Vietnamese fintech market is set to reach value of 8 billion USD in 2020. Digital payment solutions account for 89 per cent of the fintech market in Vietnam, while individual and business financial areas are also forecast to have growth rates of 31.2 percent and 35.9 percent respectively by 2025.
Governments across Southeast Asia are pushing ahead
with efforts to create cashless economies, with less developed countries such
as Vietnam and Thailand leapfrogging richer ones like Singapore and Malaysia in
electronic payments, Nikkei Asian Review reports.
Vietnam and Thailand are experiencing a boom in mobile payments as more people
use e-wallets to pay for goods and services without going through banks, it
says.
Vietnam has been promoting electronic payments since 2008. Only about 40 per
cent of the country’s 95 million people have bank accounts, mostly in urban
areas, 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 away
their cash. But none had made much headway until recently.
Now things are taking off, with the number of people making mobile payments in
stores growing faster in Vietnam than elsewhere in Southeast Asia, according to
a recent PwC report. The percentage of consumers in Vietnam using mobile payments
increased 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-based
telephone systems and gone straight to mobile and smartphones," the report
says.-VNA/VNA