The Vietnamese Prime Minister has issued Directive No. 22/CT-TTg to formulate a plan to accelerate the implementation of non-cash payments methods in the country.
In 2016, the government issued Decision No. 2545/QD-TTg approving a scheme on the development of non-cash payment for the period of 2016-2020 with an ambitious goal of slashing the ratio of cash to total payment instruments to below 10%.
Under the scheme, the government targeted the instalment of more than 300,000 card readers at points of sales (POS) to process around 200 million transactions annually in the market by 2020.
Specifically, all supermarkets, shopping centres, and modern distribution facilities must have card readers enabling consumers to make non-cash payments when purchasing goods.
It was expected that 70% of providers of electricity, water, telecom, and communication services accept non-cash payment of bills from individuals and households.
As many as 50% of individuals and households in big cities use non-cash payment instruments in shopping and consumption activities.
However, the ratio of cash to total payment instruments was high (11.33%) as of December 2019 as many people still use cash, particularly in rural and remote areas.
To foster non-cash payment, the government official urged ministries, agencies, and localities to actively realise the goals rolled out in the aforesaid decision, a press release noted.
Accordingly, the State Bank of Vietnam (SBV) was asked to promptly review and complete legal framework for non-cash payment and e-payment and submit a draft decree on non-cash payment to the government before 1 July, for approval.
The central bank was tasked to develop an automated clearing house (ACH) system for retail sale payments and put the system into operation before December 2020.
It is also responsible for designing and applying know-your-customer (KYC) solutions to promote the access and use of retail payment services while strengthening inspection and supervision of money laundering and terrorist financing to ensure effectiveness and security of non-cash payment and e-payment.
Meanwhile, the Ministry of Industry and Trade must complete mechanisms and policies to facilitate retail sale establishments to accept and use e-payment devices.
Further, the Ministry of Health shall direct hospitals to join hands with credit organisations and payment intermediary services to collect health service fees in the form of non-cash payment methods.
The Ministry of Education and Training shall guide schools to coordinate with credit organisations and payment intermediary services to collect education fees in non-cash payment.
The Ministry of Transport shall promptly issue policies to encourage the development of multi-purpose and non-physical cards for car purchase and toll collection.
In March, Prime Minister requested that SBV submit a pilot plan on using mobile money. He assigned the Ministry of Information and Communication (MIC) to join forces with SBV to put mobile money into use to reduce cash circulation.
As of the end of 2019, Vietnam had 129.5 million mobile subscribers, including 61.3 million 3G and 4G subscribers, as OpenGov reported earlier.
With 43.7 million smartphone users, accounting for 45% of the population, Vietnam is at the region’s average level; higher than India, the Philippines, Indonesia, and Thailand.
Further, with 68.5 million users, or 70.3%, Vietnam is among the countries with the highest percentage of internet users.