The Vietnamese government is pushing forward a regulatory sandbox for fintech banking and cashless payments with a view to support the development of the local fintech scene.
|Vietnam accelerates the development of regulatory sandbox for fintech |
The government has approved Resolution No.100/NQ-CP on September 6, approving the draft of a decree on controlled testing mechanisms for fintech in the banking sector. Accordingly, the government has delegated the responsibility to the State Bank of Vietnam (SBV), which will collaborate with ministries and agencies to gather input from state members and provide a report to the government in the fourth quarter of 2021.
Payments, peer-to-peer lending, client identity support, and other banking support services are the fintech categories that are expected to participate in the sandbox. Fintechs will be able to test novel products and services in a controlled environment and reach the end market faster.
Amid the Fourth Industrial Revolution, creating a regulatory sandbox for fintech is seen as critical, especially in the short term, while the government is developing a broad legal framework to meet market demands and avoid potential dangers, tax losses, and illegal activities.
Meanwhile, financial innovators in Vietnam might profit greatly from a regulatory sandbox because it would allow them to create and market innovative financial products without fully complying with all regulatory rules. Financial innovators would also be able to collect real market data on new financial products and use it to improve their products and services.
Scott Krivokopich, managing partner from Singapore-based 1982 Ventures told VIR, “The opportunities in Vietnam have an incredible potential. The support and promotion of digital payments by the government is going to unlock additional opportunities to build more fintech businesses that not only help to address financial inclusion issues but also build a new layer of infrastructure to strengthen the finance system.”