With cash still being the main payment mode, a youthful demographic and growing smartphone penetration, Vietnam offers great opportunities for fintech developers, experts said.
|A customer makes payment by QR code at a supermarket.|
Financial technology has greatly disrupted the way that banks and financial institutions operate today, they said.
According to the HCM Computer Association (HCA), around 10,000 fintech companies are operating globally, competing with banks in all fields from payment services, deposit mobilisation, lending, foreign exchange trading, and investment consulting.
Fintech companies in Viet Nam currently focus on only three services: payment, peer-to-peer lending and crowdfunding.
Dr Lillian Koh Noi Keng, CEO of Fintech Academy Singapore, said: “The infocomm and communication technology (ICT) sector is a key enabler for almost every industry, and has enhanced Singapore’s competitiveness by raising productivity and transforming business processes in industries like finance, services and manufacturing.
“Fintech came as a disruptor but it is now embraced as innovation and transformation,” she told a press briefing in HCM City on Monday to introduce the Viet Nam ICT Outlook (VIO 2019) conference.
The rise of new fintech products and services puts pressure on the traditional banking model, she said.
Hoang Cong Gia Khanh, vice rector of the University of Economics and Law, said the number of fintech companies in Viet Nam has increased from around 40 in 2016 to more than 154 now, including 37 operating in payment services and 25 in the field of P2P lending.
Some 70 per cent of fintech companies in Viet Nam are start-ups, he said.
The rapid growth in financial technology has ushered in a transformation in the financial and banking sector and offers consumers more convenient and diverse products and services, he added.
But Vietnamese fintech companies also face challenges like cybersecurity, human resource training and others.
“To further develop the fintech sector, we must enhance digital transformation in the education sector,” Ha Than, HCA deputy chairman.
Khanh said: “People are still the core factor. We still lack professional experts and managers in this sector.”
In addition, the Government must design policies and regulations that can support the development of the eco-system.
Koh said she hopes that with the establishment of a partnership between HCA and her agency, they would be able to train trainers in Viet Nam.
“We are happy to work with universities to empower young people both in training as well as research to get your universities and polytechnics ready for the future.”
Lam Nguyen Hai Long, HCA chairman, said Viet Nam’s financial system as well as fintech firms and banks need to equip themselves with latest technologies.
To help technology businesses get up-to-date on the latest global trends and technologies, HCA, Fintech Academy Singapore, the Viet Nam Banking Association, and the Institute for Development and Research in Banking Technology of Vietnam National University HCM City plan to organise the 2019 VIO in HCM City on October 31, he said.
The conference, titled ‘Shaping the future of Vietnam Fintech’, will discuss topics such as fintech and changes in technology, payment services; cybersecurity challenges for fintech; fintech and the workforce; policies and platform development for the fintech industry; machine learning and AI in the fintech marketplace; and fintech and innovative start-ups.
VIO 2019 will also feature the 2019 Top ICT Viet Nam awards ceremony on October 30 to honour outstanding IT and telecom companies, products and services and an exhibition where banks, fintech and IT companies will showcase their products. — VNS
Many foreign investors are interested in investing in Vietnam’s fintech market that have huge growth potential, said Han Ngoc Vu, general director of VIB International Commercial Bank, at Fintech Summit 2019 held in Hanoi recently.
According to Solidiance Consultancy, transactions on Vietnam’s fintech market could nearly double to US$7.8 billion in 2020 from $4.4 billion last year.
A cross-border payment start-up has bagged the first prize of US$5,000 at the Fintech Summit 2019 competition.