Vietnam’s fintech explosion: investment capital soars from 0% to 36% in SE Asia

The investment capital poured into Vietnam’s fintechs in 2019 accounted for 36 percent of total capital into Southeast Asia. The figure was zero percent in 2018.

In 2015, fintechs began developing in Vietnam and the fintech community has been developing strongly since then, especially in Hanoi and HCM City. However, the number of fintechs in Vietnam remains modest if compared with other regional countries.

Vietnam’s fintech explosion: investment capital soars from 0% to 36% in SE Asia



In Vietnam, MoMo is one of rare fintechs finding its name among the startups of international stature. It once was listed in the world’s top 100 fintechs. Some startups have utilized AI and data science in daily services that serve large communities of people, including FE Credit, Tima and Trusting Social.

The total amount of capital poured into the country soared from zero percent in 2018 to 36 percent of total capital flowing into Southeast Asia in 2019. The sharp rise just within one year showed the explosion of Vietnam’s fintechs.

The total amount of capital poured into the country soared from zero percent in 2018 to 36 percent of total capital flowing into Southeast Asia in 2019. The sharp rise just within one year showed the explosion of Vietnam’s fintechs.

Until now, fintechs, especially the ones providing payment services, have to spend big money to increase their presence in the community.

 


Ha Dang Chinh, a fintech expert at Tinh Van Technology JSC, warned that the fintechs need to be cautious when ‘burning money’ to attract users.

There are two important parts in expenses of technology firms. First, the expenses to obtain one user (creating habit of using service by regular customer). Second, the value of the life cycle customers can pay.

It is necessary to analyze the relation between the amounts of money fintechs spend and the money customers can bring.

“We sometimes say we ‘burn money’ to obtain users, but we sometimes don’t understand the reasons why we burn money,” he said.

He went on to warn that the ‘burning money’ policy may do more harm than good. Users will immediately leave one e-wallet and shift to another one that is offers bigger preferences.

“One person may have 5-10 accounts,” he said.

The strong rise of fintechs has raised a question if fintechs could be a threat to banks.

Chinh commented that the banking sector is in the third wave of development. The second wave was seen some years ago and it was the development of e-banking. At present, banks are developing digital banking.

To develop digital banking, banks have to rely on new technologies such as AI, Big Data and Machine Learning.

In the process of digital transformation, the banks which go slowly will be seriously affected, but this will be the opportunity for small banks which still don’t have large coverage.

The expert believes that banks and fintechs should cooperate with each other to upgrade the services to be provided to customers.

Thanh Lich 

Are fintechs in Vietnam mostly e-wallets?

Are fintechs in Vietnam mostly e-wallets?

Investment funds had poured $410 million into Vietnam’s fintechs as of the end of September 2019, according to a report of PricewaterhouseCoopers, United Overseas Bank and Singaporean Fintech Association.

VN e-commerce and fintech firms successfully call for huge capital in 2019

VN e-commerce and fintech firms successfully call for huge capital in 2019

E-commerce and fintechs accounted for four-fifths of the total number of big calls for capital in 2019. The biggest deal was worth $300 million.

 
 

Other News

.
Vietnamese industrial market update – Rise of coastal industrial zones
Vietnamese industrial market update – Rise of coastal industrial zones
BUSINESSicon  24/11/2020 

The demand for industrial property at coastal regions is high, but the supply of industrial land ready to hand over in industrial zones in both regions was scarce.

HCM City hopes to attract investment by allotting more lands in IPs, EPZs for infrastructure
HCM City hopes to attract investment by allotting more lands in IPs, EPZs for infrastructure
BUSINESSicon  24/11/2020 

HCM City authorities plan to offer competitive land rents and other incentives at industrial parks (IPs) and export processing zones (EPZs), and earmark more lands for building infrastructure to attract investment.

HCM City seeks ideas for underground space planning through international competitions
HCM City seeks ideas for underground space planning through international competitions
BUSINESSicon  24/11/2020 

The HCM City Department of Planning and Architecture has reported to the city People’s Committee on underground space planning and underground space management regulations.

Preliminary decision on tyre exports flusters the market
Preliminary decision on tyre exports flusters the market
BUSINESSicon  24/11/2020 

The global demand for rubber and tyre products has been consistently increasing throughout the last decade, with Vietnam being one of the top suppliers of these items.

17th CAEXPO to benefit China-Vietnam cooperation
17th CAEXPO to benefit China-Vietnam cooperation
BUSINESSicon  23/11/2020 

China and Vietnam are friendly neighbors connected by mountains and rivers, and have achieved fruitful results in the sustained economic and trade cooperation. 

More M&A deals in the banking sector next year: local media
More M&A deals in the banking sector next year: local media
BUSINESSicon  23/11/2020 

Vietnam’s equity market may witness big merger and acquisition (M&A) deals in 2021 as local banks are trying to lure foreign capital on the country’s participation in international trade deals.

Office rental rates to fall by end of year: experts
Office rental rates to fall by end of year: experts
BUSINESSicon  23/11/2020 

Office rental rates will continue to drop while supply will be in the non-central business district areas in HCM City in the coming time, according to property research companies.

'Ghost' restaurants flourish in Ho Chi Minh City
'Ghost' restaurants flourish in Ho Chi Minh City
BUSINESSicon  23/11/2020 

Without tables, chairs or waiters, "ghost" restaurants are flourishing in Vietnam, serving only online customers.

When private businesses get stronger
When private businesses get stronger
FEATUREicon  23/11/2020 

The private sector is very active in key sectors of the economy. If there is a "push", they will become an important force with other economic sectors to take the country forward.

Coastal industrial zones attractive to investors
Coastal industrial zones attractive to investors
BUSINESSicon  23/11/2020 

Vietnam’s industrial zones property located near the sea is attracting great attention to investors as they maintain high occupancy rates and rental prices, heard attendants at a conference held in Hanoi on Thursday.

Smarter logistics will benefit Vietnam: experts
Smarter logistics will benefit Vietnam: experts
BUSINESSicon  23/11/2020 

Smarter logistics are key for Vietnam to advance in the global value chain amid the fourth industrial revolution and the COVID-19 pandemic, experts told the Vietnam Business Summit 2020 held in Hanoi recently.

HCMC real estate market poised to recover next year
HCMC real estate market poised to recover next year
BUSINESSicon  23/11/2020 

The real estate market in HCMC has seen signs of recovery since August and is expected to see a strong rebound during the upcoming traditional Lunar New Year holiday and next year, according to the HCMC Real Estate Association (HoREA).

Vietnamese firms to invest in three key aspects for digital transformation
Vietnamese firms to invest in three key aspects for digital transformation
BUSINESSicon  23/11/2020 

Many companies in Vietnam are considering an approach to workplace digital optimization beyond Covid-19.

Louis Vuitton, Christian Dior join Hanoi luxury market
Louis Vuitton, Christian Dior join Hanoi luxury market
BUSINESSicon  23/11/2020 

Leasing flagship stores of Louis Vuitton and Christian Dior show stronger sentiment towards luxury brands in Vietnam.

Thousands of Mercedes-Benz recalled in Vietnam over defective airbags
Thousands of Mercedes-Benz recalled in Vietnam over defective airbags
BUSINESSicon  22/11/2020 

Some 3,200 Mercedes-Benz cars in Vietnam have been found to have problems with Takata airbags, according to the Vietnam Register.

Binh Dinh-based Phu Cat airport proposed to become international one
Binh Dinh-based Phu Cat airport proposed to become international one
BUSINESSicon  22/11/2020 

The Binh Dinh government has written to the Ministry of Transport and the Civil Aviation Authority of Vietnam proposing turning Phu Cat Airport into Phu Cat International Airport.

Vietnam, Oman to foster bilateral trade
Vietnam, Oman to foster bilateral trade
BUSINESSicon  22/11/2020 

The two-way trade turnover increased sharply from US$117 million in 2017 to US$200 million in 2019.

Ministry working to promote growth of support industries
Ministry working to promote growth of support industries
BUSINESSicon  22/11/2020 

The Ministry of Industry and Trade (MoIT) has introduced a range of measures to boost the growth of support industries in a bid to promote the engagement of local companies in production chains.

What does the 'rescue' of Vietnam Airlines reveal?
What does the 'rescue' of Vietnam Airlines reveal?
FEATUREicon  22/11/2020 

The national airline of Vietnam finally saw "the light at the end of the tunnel" when the National Assembly agreed with the Government's proposal for solutions to help Vietnam Airlines overcome difficulties caused by the Covid-19 pandemic.

HCMC’s US$12.7 billion property debt at risk of turning sour
HCMC’s US$12.7 billion property debt at risk of turning sour
BUSINESSicon  24/11/2020 

Although real estate outstanding loans are still within the safety zone, the HCMC Real Estate Association (HoREA) has warned of a possibility that they might turn sour.

 
 
 
Leave your comment on an article

OR QUICK LOGIN