E-wallet players look to take hold of market gaps

One month after Moca, the e-wallet primarily operating on the super app Grab, announced its cessation citing strategic restructuring, the Vietnamese e-wallet market remains an enticing playground for the remaining players, despite the increased competitive factors.

E-wallet players look to take hold of market gaps, illustration photo/ Source: freepik.com

Adopting a different strategy, Zalopay recognised the market shift with the emergence and rapid growth of VietQR in mid-2023. Zalopay introduced the versatile Zalopay QR multi-function, enabling users to transfer and make payments via VietQR from any banking app or e-wallet.

Just six months after its launch in July 2023, Zalopay QR was available in over 12,000 store chains and recorded about 19 per cent of transactions coming from banking apps.

The company also allocates up to 70 per cent of resources to attract more users through expanding payment methods on the app, including bank transfers, Apple Pay, international Visa/Mastercard. With these new methods, users can now use the Zalopay app to pay for features and services without needing to link to a bank as before.

Moreover, Zalopay has introduced Zalopay Priority, designed to assist loyal users with payments and reward points across both Zalopay and banking apps.

The application also provides users with higher-end digital financial products such as savings, consumer loans, cash loans, and installment payments.

“We are gradually realising our vision to bring added value to users, demonstrating our commitment to long-term companionship with the Vietnamese e-payment market. These efforts also help Zalopay optimise costs, as we recorded a 40 per cent revenue growth last year, while the loss from business operations decreased significantly by 42 per cent,” a Zalopay representative noted.

According to The Connected Consumer report released in 2023 by market research company Decision Lab in collaboration with the Vietnam Mobile Marketing Association, MoMo is leading the e-wallet market in Vietnam with a 68 per cent market share.

Ranked second in the leaderboard is Zalopay with a 53 per cent market share and 14 million users, followed by Viettelpay with 27 per cent, ShopeePay with 25 per cent, and VNPay with 16 per cent. Moca previously ranked sixth in market share based on The Connected Consumer’s evaluation, before it pulled out.

Since July, following Moca’s official cessation of operations, Zalopay and MoMo have become the two primary payment methods on the Grab app.

MoMo in Vietnam boasts around 31 million users and is involved in nearly half of total e-wallet transactions, according to data up to the third quarter of 2023 on the National Public Service Portal.

In the race to increase market share, MoMo is also striving to prove itself by regularly introducing dynamic payment trends such as AI-generated QR codes, reminders for debt payment, and split bills services.

Meanwhile, ShopeePay is leveraging the e-commerce strength of Shopee, while VNPay focuses on its core area as a payment gateway for local retail stores, boasting the highest market coverage with over 350,000 payment acceptance points.

Despite owning strong growth opportunities and dividing the fruitful market share pie, data analysis unit Vietdata evaluates that the Vietnamese e-wallet market is not yet mature and is revealing challenges in achieving profitability.

The financial reports of e-wallets collected by Vietdata indicate that many e-wallets have seen steady revenue growth, but post-tax profits still remain modest.

MoMo has emerged with a growth rate of 10 per cent annually during the period of 2020-2023, achieving a revenue of over $392 million in 2023, ranking second only to VNPay but recording a post-tax loss of over $8.3 billion.

Zalopay’s financial report also shows a loss of over $29.1 billion in 2023, narrowing by nearly half compared to 2022 but still leading the industry in terms of losses. Also, last year, Zalopay’s sales revenue reached nearly $41.6 million.

VNPay and Payoo are two rare e-wallets that achieved positive growth in both revenue and profit in 2023, with revenues of nearly $1.25 billion and $125 million respectively, and profits of nearly $12.5 billion and $16.6 billion, respectively.

Vietnam is one of the top three dynamic e-wallet markets in Southeast Asia, following Indonesia and the Philippines, with approximately 67.6 million users, as evaluated by Statics.

According to the State Bank of Vietnam, by the end of 2023, there were approximately 57 million activated e-wallets in Vietnam, with 36 million wallets among them actively in use.

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