HCM City seeks faster switch to cashless payment

Illustrative image (Photo: VNA)

HCM City - Nguyen Anh Duc, general director of Saigon Co.op, said the rate of cashless payment at its system, including Co.opmart, Co.opXtra, Co.op Food, and Co.op Smile, has increased sharply since last year from 3-5 percent to nearly 21 percent now.

It targets a 30 percent ratio within four to five years.

Saigon Co.op has been collaborating with other companies to deploy a series of new payment services and applications based on tech platforms that offer more convenience and privileges to customers shopping at its over 800 stores, according to Duc.

Many factors have caused this surge in cashless payment like the impact of communications, which has eliminated the “strangeness” consumers used to feel about cashless payments, and the COVID-19 pandemic, which acted as a catalyst in rapidly increasing the use of cashless methods.

Another important factor has been the improved infrastructure for connecting retailers and payment service providers and legal mechanisms to protect people making cashless payments, and users' increasing trust in the confidentiality and safety of digital payment.

According to the State Bank of Vietnam’s payment department, more and more people pay for daily essentials, air tickets, insurance, and others using cards, e-wallets or internet banking.

In the first four months of the year, payment by cards increased by 15.7 percent year-on-year, internet payments by 45.7 percent and mobile payments by 166.1 percent.

Payment trends in the economy have shifted towards non-cash modes, while the rate of electronic payments for public services is increasing.

Tran Vinh Tuyen, Vice Chairman of the municipal People’s Committee, said, “[Enabling] cashless payment for education and healthcare has yielded positive results.

“Students at about 80 percent of city schools no longer pay their tuition fees in cash since 400 public schools have started collecting tuition via bank transfer.

“Half of the city’s healthcare services allow patients to pay fees cashlessly.”

“The city is on course to build a smart city, so building a cashless society is among its main goals,” Tuyen said.

To boost cashless payment in the city, on the occasion of Cashless Day on June 16 the State Bank of Vietnam affixed the “cashless payment” label at Co.opmart Cong Quynh in District 1, many stalls at An Dong Market in District 5 and a petrol station belonging to Saigon Fuel JSC on Cach Mang Thang Tam Street in District 3.

Sacombank, in co-operation with Visa and Nextpay, has installed mPOS card swipe machines at many booths at An Dong Market and plans to next install machines at other markets in District 5.

Further boosting cashless payment

The non-cash payment rate has increased in the city, but is still below expectations, according to banks and authorities.

Tuyen said many public facilities have yet to go cashless.

The city will continue to direct departments and agencies to promote non-cash payments for public services, he said.

The city has sent an urgent request to the Ministry of Finance to provide guidance on specific financial mechanisms to allow administrative and non-business organisations to pay service charges to banks and e-wallets.

Many banks said the lack of a fee schedule for public services makes it hard for them to offer non-cash payment.