Most Vietnamese still prefer cash payment

15-May-2019 Intellasia | Nguoi Lao Dong | 6:00 AM Print This Post

Although electronic payment channels are growing strongly, cash still dominates in Asean region, especially in Vietnam.

This is the information given in the report “Cash digitisation in Asean What it means for the future corporate treasurers and consumers”, announced by Standard Chartered Bank..

According to reports, cash accounts for more than 70 percent of transactions in the Philippines and Indonesia and 43 percent in Singapore. Among the six surveyed countries, the number of people aged 15 and over in Vietnam has a bank account, credit card, and debit card (ATM) remains low as they mainly pay by cash when purchasing goods online.

Particularly in Vietnam, the rate of customers choosing to pay by cash when shopping online is up to 90.17 percent, while this rate in Singapore is only 9.93 percent and in Thailand 48.49 percent.

The proportion of people having bank accounts in Vietnam is also the lowest (30.8 percent) among the reported countries such as Indonesia 48.86 percent, Malaysia 85.34 percent, Singapore 97.93 percent, etc.

Why do people still prefer cash, though countries are trying to reduce this ratio and promote cashless payment channels? The report clearly identifies four main reasons such as a lack of digital payment knowledge; concerns about personal financial privacy; thinking that cash is the simplest way and increase in costs for electronic payments in small and medium sized enterprises.

Standard Chartered’s research experts recognise that although Asean cannot become an early cashless market, solutions provided by technology can encourage consumers and businesses to use digitalisation.

As in Vietnam, the number of e-wallets is growing. There are about 20 e-wallet applications in Vietnam such as Vietnamese Wallet, Zalo Pay, 123Pay, Bao Kim, Bankplus, MoMo, Payoo and Wepay. The total value of transactions via e-wallet is accelerating, accordingly. With the intention of using cashless payment services to reduce the rate of cash transactions to below 10 percent in the period 2016-2020, e-wallet payment services are expected to thrive strongly in the future. Many foreign brands such as Samsung Pay, Alipay, and Amazon have also jumped into Vietnam market to explore this great potential.

The implementation of instant payment solutions in most Asean markets will help the cash flow rotation become faster, simpler and more efficient. At the same time, the usage of automatic deposit machines will reduce cash handling costs on the total amount of cash to be processed compared to the traditional method of collecting money.

In addition, the development of digital banking infrastructure in Asean offers many opportunities. To narrow the digital technology gap, banks are boosting their investment to provide more creative services. A study showed that 64 percent of financial institutions in Asean had investment plans to develop and modernise payment infrastructure in the next two years.

 


Category: Finance, Vietnam

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