Minister of MIC Nguyen Manh Hung

Explaining the decision, Phuc said it would help boost e-payment services. Vietnam needs to develop telecommunication infrastructure, not only for communications, but also for the digital economy in the 4.0 era.

However, analysts say that Vietnam will have to think carefully about the new payment method and weigh the pros and cons before applying the method on a large scale.

In principle, new technologies will lead to the establishment of new business models which may replace traditional ones. E-hailing apps, for example, are a threat to traditional taxis, while fintechs are challenging traditional banks.

Minister of Information and Communication Nguyen Manh Hung said making payments with telecommunication accounts will help Vietnam build a non-cash society, but it will challenge commercial banks.

The development of technologies and business models will depend on decisions made by the government. The problem is whether the government will facilitate new technologies. 

New technologies have changed the nature of many business fields, leading to the establishment of X-Tech, such as FinTech, EduTech and AgriTech.

If Vietnam accepts new models, the latest technologies and talents will flock to Vietnam, where new industries will take shape. If so, the country will be able to create digital products for export.

However, Hung stressed that if Vietnam chooses to go this way, it needs to make decisions sooner than other countries.

“In the 4.0 industry revolution, the future is not on the path of the past. Countries like Vietnam have opportunities to take big leaps in the development path. But it needs to have new, non-traditional and non-sequential thinking. Both state agencies and businesses need to make a breakthrough in thinking,” Hung said.

Dang Tuyet Dung, Visa director in charge of Vietnam and Laos, said the policy on  payments with telecommunication accounts would help users more easily approach non-cash payment modes. However, she said it is necessary to build an open ecosystem for telcos to connect with each other and other partners.

After two years of implementing the government’s project on non-cash payments, the percentage of e-payment transactions has improved significantly. However, cash payment still accounts for 90 percent of total payments.

According to the State Bank of Vietnam (SBV), there are 18,170 ATMs, more than 294,000 POS and 101 million cards. 

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