The State Bank of Viet Nam (SBV) is drafting new policies and regulations related to cashless payments that will allow domestic commercial banks and intermediary payment companies to co-operate with foreign intermediary payment companies to provide international payment services.
Under current financial regulations, domestic banks are only allowed to cooperate with foreign banks and international card organisations for international payments. There are no regulations for international payments that are made through foreign e-wallets or international payments that don’t go through bank accounts.
In the era of Industry 4.0, this loophole has excluded Vietnam’s domestic banks from international payment opportunities, especially in the ecommerce sector and travel industry sectors.
Vietnam’s travel industry had been dynamically expanding prior to the global COVID-19 pandemic, with one of the largest inbound travel segments being Chinese tourists who want to use their Alipay and Wechat Pay accounts to pay for services and products in Vietnam.
Already multiple banks and intermediary payment companies have asked the SVB to allow them to co-operate with foreign intermediary payment companies so that they are capable of serving international demand while exploiting the large potential of this segment.
Nguyen Hung, General Director of TPBank, said that under current regulations, domestic banks can’t co-operate with foreign e-wallets because of the lack of a legal framework. Nguyen said that, “We are getting ready to start but must wait for the green light from the central bank.”
Pham Tien Dung, Director of the SBV’s Payment Department, said that Industry 4.0 is creating a variety of new international payment models. Previously, international payments were mainly conducted via bank accounts and credit cards, but now e-wallets were emerged.
Dung says, “It is clear that the definition of international payment must be changed. People should be able to make international payments through their banks and also via intermediary payment methods. In a changing world, the management method needs to change.”
E-wallets are developing rapidly in Vietnam. AppotaPay, a local payment platform received it’s official license from the SBV in October, making it the 39th intermediary payment company in the country.
The SVB reports that for the first quarter of this year, 225 million transactions were conducted via e-wallets and that there were 13 million activated e-wallet accounts in Vietnam with a total outstanding balance of more than $58 million USD.