In an effort to bolster non-cash payments in Vietnam, the country’s government is endeavoring to make a mobile money sandbox for companies in the telecom space. The plan is pending approval and could allow firms to test services for mobile money that are not connected to bank accounts of consumers, Deal Street Asia reported.
As mobile money allows customers to transfer money using their mobile phones, this service could serve people without bank accounts, especially those in remote and hilly areas that lack access to financial services. The country’s three leading telecom firms – Viet Nam Posts and Telecommunications Group (VNPT), Viettel and MobiFone – had earlier proposed to the government to formulate policies enabling such e-payment services.
According to the report, roughly 40 percent of the 95 million people in Vietnam have bank accounts. By contrast, there are approximately 120 million mobile phone subscriptions and the telecoms network covers the entire country. At the same time, it was reported that demand for options for ePayments has increased noticeably in recent times.
In January, news broke that Vietnam wants to be a cashless society, but bank regulations are hindering its ability to do so. The problem isn’t said to be cash flow to grow market share for firms in the field or a lack of investment in the sector — it’s said to be the eWallet regulations created by the State Bank of Vietnam.
At the same time, it was reported that the government had recently made a goal to decrease cash transactions in urban households in half by 2020. Even so, the report noted that a 2014 central bank rule requires digital wallet accounts to be tied to a bank account held by the same person. In the event that a consumer doesn’t have a bank account in the country, that consumer cannot get an eWallet.
Governments across Southeast Asia are pushing ahead with efforts to create cashless economies, with less developed countries such as Vietnam and Thailand leapfrogging richer ones like Singapore and Malaysia in electronic payments. Vietnam has been promoting electronic payments since 2008.