Obstacles stand in way of mobile money

A subscriber uses Mobile Money via their smartphone. (Photo: kinhtedothi.vn)

Hanoi - Mobile money (MM) has not gained much popularity in the country among mobile phone users due to several shortcomings.

Nguyen Son Hai, Deputy General Director of VNPT Media Corp., underlined MM’s monthly transaction limits of 10 million VND (437 USD) as a major downside discouraging clients.

He said the limits were relatively low, not giving enough elbow room for personal expenses, including monthly bills and daily outgoings.

Additionally, MM generally performs the same function as an e-wallet, but the former does not link to a bank account like the latter.

The absence of such a link is an inconvenience to people who make payments frequently via bank accounts.

Another downside is that money from MM accounts can only be transferred to other accounts in the same network, with inter-network transfers unavailable.

Bui Son Nam, Deputy General Director of MobiFone, stressed that MM subscription required a new version of ID cards.

Unfortunately, many people use old cards to subscribe to mobile phone services.

This means these subscribers have to go to network operator business locations to update personal information if they opt for MM. Such requirements put off many mobile phone users.

The deputy general director also said that internet banking, QR codes, e-wallets and many other means of payments have taken up the lion’s market share.

Notably, over 70 percent of adults in Vietnam have bank accounts already, making it more difficult for a newcomer like MM to gain ground in the market.

According to the Ministry of Information and Communications, Vietnam has just 588,000 MM subscribers so far, accounting for 0.47 percent of total mobile phone users.

While Viettel introduced MM in December 2021 with 402,000 subscribers, VNPT had inaugurated it a week earlier with 200,000 subscribers.

Nguyen Truong Giang, General Director of VinaPhone, said MM was a new means of payment, so the service provider was rolling out the system with great care.

He also said that MM subscribers currently accounted for just a tiny portion of the total number of VinaPhone subscribers.

However, the room for growth is ample once MM facilities, notably acceptance points, expand to a certain point.

“We believe that once MM coverage becomes large enough in Q3 this year and subscribers get used to the money, MM market will begin to skyrocket,” said the general director.

MM is currently under pilot schemes that service providers must run for two years. Results of the schemes will serve as a basis for official regulation of the money in Vietnam.