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Banking & Finance

Vietnamese increasingly prefer electronic payments

Released at: 09:14, 05/04/2017

Vietnamese increasingly prefer electronic payments

Photo: Visa

Consumer preference for electronic payments grows 8 per cent last year against 2015, Visa’s 2016 Consumer Payment Attitudes Study finds.

by Hong Nhung

Vietnamese consumers are increasingly leaving their cash at home, with 62 per cent preferring to use electronic payments, according to Visa’s 2016 Consumer Payment Attitudes Study conducted in Vietnam and other Southeast Asia countries and released recently.

Consumer preference for electronic payments in Vietnam has grown 8 per cent compared to the 2015 survey results. Conducted on 500 individuals in six key cities and provinces - Ho Chi Minh City, Hanoi, Da Nang, Can Tho, Hai Phong and Khanh Hoa - reveal that there were 67.4 million bank accounts in Vietnam in 2016 compared to 16.8 million in 2010.

Payment by card, however, only accounted for 3 per cent of all personal consumption expenditure in the cities and provinces, while 50 per cent of e-commerce spending was processed by cards.

Vietnamese consumers are also carrying less cash in their wallets, with 29 per cent saying they are carrying less than they did five years ago. When asked why, the majority of respondents said it was because of their greater use of cards (59 per cent) and safety concerns over carrying cash (56 per cent).

The findings come on the back of an announcement that the Vietnamese Government plans to make transactions almost totally electronic by 2020, with the goal of having only 10 per cent of transactions conducted using cash.

“At Visa, we are wholly supportive of the government’s plans to shift the economy to electronic payments,” said Mr. Sean Preston, Visa Country Manager for Vietnam, Cambodia and Laos. “Vietnam is undergoing phenomenal economic development at the moment, and we see this as being an important step in the right direction.”

“By moving towards electronic payments, the government will be able to achieve a much better level of transparency, which is good for maintaining tax revenues and combatting the ‘grey economy’. Furthermore, with more international travelers streaming into the country, electronic payments will encourage them to conveniently and confidently spend at a wider range of merchants, which in turn will help to spread the benefits of tourism more broadly throughout the economy.”

Visa’s survey also found a range of other positive indicators for the cashless economy. Eighty-three per cent of respondents said they shopped online at least once a month, up 11 per cent from 2015. Consumers said that reading reviews, comments, and feedback on social media was one of the key factors influencing their shopping behavior (73 per cent), followed by promotional offerings (53 per cent).

The growth of smartphones in the country has also resulted in an increase in mobile commerce, or m-commerce. Almost 70 per cent of respondents shopped at least once a month on their smartphone, dominated by Gen Y (73 per cent) and Gen X (63 per cent) consumers.

Earlier this year, Visa announced that mVisa, its QR based payments service, will soon be expanded to merchants and consumers in ten countries, including Vietnam. mVisa is a mobile payments solution that will bring the benefits of easy and secure digital commerce to financial institutions, merchants, and consumers, helping accelerate the global migration from cash to electronic payments.

By removing the need for merchants to invest in expensive point of sale (POS) infrastructure, and with more than half of the adult population owning a smartphone, mVisa has the capacity to bring electronic payments to a greater number of people in Vietnam than ever before.

The survey also uncovered positive attitudes towards some of the less frequently discussed aspects of electronic payments. For instance, 77 per cent of Vietnamese respondents had a favorable view of services that use automated payments to eliminate the physical process of paying, such as taxi apps like Uber. Furthermore, 72 per cent said that they were comfortable with the use of biometrics such as fingerprints and face recognition for payment authentication.

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