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[Vietnam] Competition in the electronic payment service market intensifies/ Aiming to differentiate itself with services that are essential for life

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All kinds of payments can now be made electronically as the market becomes more competitive

According to statistics from the Vietnam Bankers Association, by August 2019, 31 companies had been approved by the State Bank of Vietnam for payment intermediary services, all of which are linked to more than 40 commercial banks. MOMO, the largest electronic payment provider, MOCA, which is linked to the Grab car-delivery service, and ZaloPay, which is linked to messenger, are said to account for 90% of the market share, but other services have been launched in rapid succession, making the market increasingly competitive. Companies are aggressively partnering with a variety of stores and institutions in an effort to attract new users and prevent existing users from switching. As a result, they are enabling electronic payments for everything from utility bills to fares and taxes, and are expanding discounts in stores. In recent years, MOMO has been supporting vehicle registration and other government services, and in 2019, the company raised funding from Warburg Pincus, a US private equity investment firm. It is also working with foreign companies, including a partnership with Czech consumer finance company Home Credit Vietnam.

Expectations are high for the expansion of Vietnamese electronic payments in a deep-rooted cash society.

Vietnam is a deep-rooted cash society, and as of 2017 more than 90% of payment methods in e-commerce are in cash; as of 2019, the percentage of Vietnamese aged 15 and older holding a bank account was 30.8%, the lowest in ASEAN. That's why electronic payment services that don't require a bank account and can be recharged by paying cash at a store have become popular and are expected to expand. However, in these days of intense market competition, electronic payment companies are being forced to differentiate themselves. MOMO is expanding its partners one after another, and recently its public service partnerships with the government have been prominent. In addition, MOMO is expanding its support for services essential to daily life, such as supermarkets and insurance companies, and seems to be trying to consolidate its position as the current largest electronic payment provider.

Translated with AI Translator

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  • Jun 15, 2020
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