Vietnam is undergoing transformation and moving toward a cashless economy, with the change being driven by innovative financial solutions and public initiatives, says Chiming, a market research firm focused on Vietnam and Indonesia. This is shown in a new report from the company.
Vietnam Consumer Trends Report 2024, released In October, we explored the key drivers of growth and opportunity in Vietnam, highlighting the rise of digital payment methods and contributing to improved financial inclusion and accessibility.
From cash dependence to cashless Vietnam
The report is based on a consumer survey of more than 2,100 participants and found that 37% of respondents used a banking app for a recent purchase, making it the most popular payment method. It has become.
Electronic wallets followed at 31%, followed by bank cards at 18%. Notably, cash usage ranked last, with only 15% of respondents relying on cash, highlighting the country’s accelerated transition away from traditional cash transactions. I’m doing it.
This transition is further supported by data from the 2024 e-Conomy SEA report by Google, Temasek, and Bain and Company. estimate The gross transaction value (GTV) of digital payments in Vietnam is reported to reach USD 149 billion in 2024, increasing by 18% year-on-year (YoY).
These findings are influenced by cultural habits and consumer preferences in Vietnam, a country that has historically been heavily reliant on cash, limited financial literacy, and a large unbanked population, especially in rural areas. highlights a clear change in
However, the proliferation of smartphones, increasing internet penetration, and a booming startup ecosystem are breaking down these barriers and helping fintechs flourish.
Fintech adoption is rapidly increasing
Beyond digital payments, other fintech innovations are also seeing increased usage and traction. For example, buy now, pay later (BNPL) transactions surged 113% in 2023 to reach USD 2.34 billion. Digital lending is also a growing fintech sector, with loan book balances expected to reach USD 6 billion in 2024, up 49% year-on-year.
Additionally, we are seeing growth and evolution in the wealth and investment space. In 2023, the number of domestic stock trading accounts reached 7.2 million accounts, an increase of nearly 6% year-on-year (YoY). This year, the number of domestic stock trading accounts is expected to increase by more than 20% to reach 8.7 million accounts.
Driving this growth is the rise of wealth tech, facilitated by advances in digital technology. These innovations are transforming wealth management, making it easier to access financial advice, manage your portfolio and discover investment opportunities.
This ecosystem is rapidly expanding. According to Vietnam Fintech Landscape 2024 Map by business consultant Khoa Nguyen Vietnam is currently home to 16 wealthtech companies, an increase of 129% compared to 7. identified Implemented in 2021 by local real estate finance startup FinHome.
Vietnam fintech situation
Vietnam’s fintech industry has experienced remarkable growth in recent years, reaching 220 solutions in 2024.
The payments industry continues to dominate, with 48 companies participating and a share of 21.8%. Point of sale (POS) terminals are followed by 24 companies with an 11% share. Cryptocurrency and blockchain have a 10% share with 22 companies. In peer-to-peer (P2P) lending, 21 companies participated, with a market share of 9.5%.
The expansion of fintech in Vietnam closely aligns with the country’s progress towards improving financial inclusion. According to Contributions to State Bank of Vietnam (SBV) Payment Director Pham Anh Tuan increased by 10% in just one year, reaching an astonishing 77.4% in 2023.
This progress is supported by strategic government initiatives focused on promoting cash withdrawal and improving financial access.
national financial inclusion strategy; launched In 2020, the SBV aims to increase the proportion of adults with access to formal financial services to 80% by 2025, expand the use of digital financial services and promote financial literacy.
government has also been released Communication programs such as “Smart Money” and “Tomorrow Bankers” that increase consumer awareness and facilitate access to financial services.
Most recently, the SBV announced a new draft Decree on a regulatory sandbox for piloting selected fintech solutions. This latest version, improved after seven iterations since 2023, focuses on three areas: credit scoring, open application programming interfaces (APIs) and P2P lending, Vietnam News reported. Sandbox implementation will last up to two years.
The adoption of fintech products in Vietnam is expected to further expand. The GTV of digital payments is expected to at least double to USD 300 billion by 2030, as predicted by the 2024 e-Conomy SEA report.
Digital loan book balances are expected to soar five-fold to USD 30 billion over the same period, and digital insurance is projected to grow five-fold to USD 500 million.
Featured image credit: Edited from freepic
