Fintech could hold key to reducing cash reliance in Vietnam

It is estimated that around $1 trillion of annual personal consumption expenditure across Southeast Asia is still made using cash or cheques. However, a young population with rising disposable income, a relatively high level of internet penetration, and more than 300 million smartphone users, presents an opportunity to rapidly transition these economies towards digital payments.

Speaking at the Vietnam Fintech Forum 2019, Adeline Kim, Visa’s head of products and solutions in Southeast Asia, said, “Everywhere we look, technology is changing the most minute elements of our day-to-day lives, helping us to get transport more efficiently, have groceries delivered straight to our homes, and connect and speak with loved ones on the other side of the world.

“With the growth of the fintech industry, we’re seeing an incredible variety of businesses emerging that are working on innovative ways to make a world of commerce more accessible to people everywhere. We see this as being particularly important in Vietnam – given that the percentage of the population that uses formal banking services is relatively low, there is vast potential that can be tapped by fintech companies who are able to address the needs of this diverse group of people,” Adeline Kim said.

Adeline Kim, Visa’s head of products and solutions in Southeast Asia

Visa is committed to setting global, interoperable standards and connecting buyers with sellers in a growing variety of channels where commerce happens. A cornerstone of Visa’s long-term strategy is to deepen current client relationships and expand into new partnerships. Visa looks for investments that will extend its network capabilities into the global open commerce ecosystem as it changes and grows, and that will provide mutually-beneficial business opportunities to as many participants as possible.

In July this year, Visa invested in Go-Jek, Southeast Asia’s leading mobile on-demand service and payments platform, as part of the latter’s ongoing Series F fundraising round. With Go-Pay's (Go-Jek's electronic payments platform) position as Indonesia’s market leader in digital payments and financial inclusion, the funding from Visa will support the acceleration of Go-Jek's payment services across Southeast Asia. The partnership will see Go-Jek and Visa collaborating on innovative payment solutions for digital-first consumers and Southeast Asia’s unbanked and underserved population.

Last year also saw Visa launch its inaugural “Visa Everywhere Initiative” in Vietnam – a global innovation programme that tasks up-and-coming businesses with solving some of the most challenging issues in payments and commerce. Visa gave out a total of VND700 million ($30,500) to selected startups in this programme in order to help them achieve their objectives in the fintech industry.

Visa country manager for Vietnam and Laos, Dang Tuyet Dung, said, “Helping the population of Vietnam to migrate to digital payments is a goal that we share with the government and the State Bank of Vietnam. In addition to our long-standing relationship with financial institutions, we’re committed to working with the fintech community through initiatives such as our Visa Everywhere Initiative to realise both our goals of financial inclusion and digital transformation, as well as the economic goals in the cashless agenda of the government of Vietnam.”

Visa Inc. (NYSE: V) is the world’s leader in digital payments. Its mission is to connect the world through the most innovative, reliable, and secure payment network – enabling individuals, businesses, and economies to thrive. Its advanced global processing network, VisaNet, provides secure and reliable payments around the world, and is capable of handling more than 65,000 transaction messages a second. The company’s relentless focus on innovation is a catalyst for the rapid growth of connected commerce on any device, and a driving force behind the dream of a cashless future for everyone, everywhere.