A cashless transaction (Photo: vietnambiz.vn)Hanoi (VNS/VNA) - Vietnam is entering theFourth Industrial Revolution with the participation of all sectors, includingthe banking system; however, non-cash payment has seen development stall as thecountry’s population has not yet embraced its benefits.
Representatives from various sectors and agencies discussedhow to promote cashless payment systems in rural areas at a workshop in Hanoion September 28.
At the workshop, Deputy Chairman of Vietnam Farmers’Association Pham Tien Nam said these cashless systems are a worldwide trendthat some Vietnamese people have started to embrace as an alternative to normalcash transactions.
“Non-cash payments will be indispensable as the country’stechnology and economy develop,” said Nam. “The whole world is moving toward acashless society.”
Nam cautioned that the development of systems in Vietnam,especially in rural areas, was still limited.
“About 40 percent of Vietnamese people already have bankaccounts, but 90 percent of population still spends cash daily,” he said. “Nearly99 percent of people use cash to pay for commodities valued below 100,000 VND,and up to 85 percent of ATM transactions are cash withdrawals.”
Cash is also fading away in tax payments. Electronictaxation was implemented for the first time in 2014, and 95 percent ofbusinesses have now registered to pay taxes electronically via commercialbanks. The portion of tax revenue received electronically has risen to 70 percent,but there are still businesses that prefer to make direct payments.
The utilities sector is also moving away from traditionalpayment methods. A report by Electricity of Viet Nam showed that there are 4.5million customers paying via banks and intermediaries, accounting for 18.47 percentof users nationwide. There may still be so many holdouts because people areafraid of change.
According to Nam, domestic consumers and rural farmers oftenuse cash because it is fast, convenient and accepted universally. It is alsoeasy to manage a cash budget without worrying about additional costs. Cashpayments are secure and private because they leave no digital trace and revealno personal information.
Nam said that while Vietnamese consumers, especially thosein rural areas, had been encouraged to use cashless payments, the system’sinfrastructure remained weak.
Unofficial statistics report that, excluding Agribank,commercial banks have only two or three transaction points in each ruraldistrict. Meanwhile, urban districts have nearly 40 transaction points onaverage.
Nghiem Thanh Son, Deputy Director of the Payment Departmentof the State Bank of Vietnam (SBV), said more than 60 percent of the populationin rural areas uses smart phones, which could signify favourable conditions fornon-cash payment systems to develop.
“The challenge now is to expand the network of cardacceptance points to help people make small transactions in rural and remoteareas,” Son said. “In addition, the Central Bank should allow non-bankorganisations to provide collection and payment services to ensure users haveenough options.”
Son said that among the tens of millions of successful dailytransactions, a very small number of failed transactions had caused customersto doubt the efficacy of the whole system.
“No matter where the error comes from, whether it is thefault of the bank or the user, people will still be concerned,” he said. “TheState governing body will always follow up on these problems. We will ensure wework to help people who have lost money in these cases.”
Nguyen Viet Hai, head of Agribank’s Research and ServiceDevelopment Department, suggested the State Bank and relevant agencies studymechanisms for charging costs like withdrawal fees at ATMs.
“There should be a policy to encourage people in rural areasto use modern telecommunications services such as mobile phones, 4G services,internet banking and modern cashless payment systems,” said Hai.-VNS/VNA
Representatives from various sectors and agencies discussedhow to promote cashless payment systems in rural areas at a workshop in Hanoion September 28.
At the workshop, Deputy Chairman of Vietnam Farmers’Association Pham Tien Nam said these cashless systems are a worldwide trendthat some Vietnamese people have started to embrace as an alternative to normalcash transactions.
“Non-cash payments will be indispensable as the country’stechnology and economy develop,” said Nam. “The whole world is moving toward acashless society.”
Nam cautioned that the development of systems in Vietnam,especially in rural areas, was still limited.
“About 40 percent of Vietnamese people already have bankaccounts, but 90 percent of population still spends cash daily,” he said. “Nearly99 percent of people use cash to pay for commodities valued below 100,000 VND,and up to 85 percent of ATM transactions are cash withdrawals.”
Cash is also fading away in tax payments. Electronictaxation was implemented for the first time in 2014, and 95 percent ofbusinesses have now registered to pay taxes electronically via commercialbanks. The portion of tax revenue received electronically has risen to 70 percent,but there are still businesses that prefer to make direct payments.
The utilities sector is also moving away from traditionalpayment methods. A report by Electricity of Viet Nam showed that there are 4.5million customers paying via banks and intermediaries, accounting for 18.47 percentof users nationwide. There may still be so many holdouts because people areafraid of change.
According to Nam, domestic consumers and rural farmers oftenuse cash because it is fast, convenient and accepted universally. It is alsoeasy to manage a cash budget without worrying about additional costs. Cashpayments are secure and private because they leave no digital trace and revealno personal information.
Nam said that while Vietnamese consumers, especially thosein rural areas, had been encouraged to use cashless payments, the system’sinfrastructure remained weak.
Unofficial statistics report that, excluding Agribank,commercial banks have only two or three transaction points in each ruraldistrict. Meanwhile, urban districts have nearly 40 transaction points onaverage.
Nghiem Thanh Son, Deputy Director of the Payment Departmentof the State Bank of Vietnam (SBV), said more than 60 percent of the populationin rural areas uses smart phones, which could signify favourable conditions fornon-cash payment systems to develop.
“The challenge now is to expand the network of cardacceptance points to help people make small transactions in rural and remoteareas,” Son said. “In addition, the Central Bank should allow non-bankorganisations to provide collection and payment services to ensure users haveenough options.”
Son said that among the tens of millions of successful dailytransactions, a very small number of failed transactions had caused customersto doubt the efficacy of the whole system.
“No matter where the error comes from, whether it is thefault of the bank or the user, people will still be concerned,” he said. “TheState governing body will always follow up on these problems. We will ensure wework to help people who have lost money in these cases.”
Nguyen Viet Hai, head of Agribank’s Research and ServiceDevelopment Department, suggested the State Bank and relevant agencies studymechanisms for charging costs like withdrawal fees at ATMs.
“There should be a policy to encourage people in rural areasto use modern telecommunications services such as mobile phones, 4G services,internet banking and modern cashless payment systems,” said Hai.-VNS/VNA
VNA
