In Vietnam, there are big potentials for non-cash payment, especially in the context of intensive integration into the global economy and the fourth Industrial Revolution. On the framework of the Program themed “Non-cash Day”, a Conference with the theme of “Cashless society: Policy and Practical situations in Vietnam” was organized on June 11, 2019 in Ho Chi Minh City by the Payment Department of the State Bank of Vietnam (SBV) and the Tuoi Tre Newspaper.
Attending the Conference were Deputy Prime Minister Vuong Dinh Hue, SBV Governor Le Minh Hung, Deputy Governor Nguyen Kim Anh, leaders from the Ministry of Information and Communications, the Ministry of Science and Technology and Ho Chi Minh City People's Committee, representatives from the SBV departments, payment intermediaries, commercial banks, payment service providers, enterprises, specialists, scientists and press agencies.
Benefits of non-cash payment and international trend
At the Conference, all the comments mentioned the benefits of electronic payment for enhancing the transparency of the economy and expanding banking and financial services to all people. For consumers, electronic payment brings outstanding utilities, such as time and cost saving, and higher safety. For commodity and service providers, electronic payment helps them deploy and provide their services quickly; assess, classify and expand groups of customers through electronic data; improve operational efficiency and minimize the risks and costs, etc. E-payment also brings benefits to the Government, i.e enhancing the transparency of the economy; expansion of the accessibility and use of the banking and financial services of all people…
Thus, it can be seen that the promotion of electronic payment towards a non-cash society is an inevitable trend in the context of the Industrial Revolution 4.0, creating double impacts on promoting economic growth and supporting the implementation of financial inclusion strategy through educating knowledge about the financial and banking services.
Deputy Governor Nguyen Kim Anh speaks at the Conference
However, it is concerned that there are potential risks in a cashless society, such as confidentiality, data security, cyber security, users’ rights, etc. This is what the management agencies in Vietnam have been concerning about in the process of developing and conducting policies towards a non-cash society.
Recognizing the role and importance of non-cash payment, the Prime Minister has issued Decision No. 2545/QD-TTg approving the Scheme on Non-Cash Payment Development in Vietnam for the 2016-2020 period, with the aims of creating a big change in non-cash payment in the economy, gradually changing the habit of using cash to e-payment.
Non-cash payment in Vietnam has grown strongly in the region
Implementing the Government's directions of developing non-cash payment, in addition to improving the legal framework and the policies on payment activities, the SBV has conducted comprehensive measures and directed the credit institutions to continue to invest and develop the payment infrastructures, enhance the security and ensure customers' benefits, apply the achievements of the Industrial Revolution 4.0 to the payment services.
At the same time, the SBV has also enhanced the communication task to disseminate the knowledge, improve the awareness, change the behaviors and payment methods of the people, thereby improving the access to banking products and services, encouraging the use of non-cash payment methods. The SBV has proactively formulated the contents and coordinated the implementation of financial education programs that are highly appreciated by the public such as "Smart Money", "Smart kids ", the contest of "Understanding about Money" , "Wise money" ...
Overview of the Conference
With the directions of the Government, the efforts of the banking industry and the society, the payment activities in the economy have achieved positive results. According to Mr. Pham Tien Dzung, Director General of the SBV Payment Department, the total transaction volume through the Inter-bank electronic payment system in the first five months of 2019 increased by 23.23% for the number of transactions, and by 17.63% for the transaction value, as compared to the same period last year. In addition, the payment services, especially payment facilities, payment services based on IT applications and achievements of the fourth Industrial Revolution, have developed robustly. Electronic payments via the internet and mobile phones have also developed. By March 31, 2019, the number of financial transactions via the internet increased by about 66%, the transaction value increased by 14% as compared to the same period in 2018; the number of financial transactions via mobile phones increased by about 98%, the transaction value increased by 232.3% as compared to the same period in 2018. Moreover, payments for public services through commercial banks have also been promoted. Currently, there are about 50 banks coordinating with the tax and customs authorities to collect e-tax in 63 provinces and 768 districts across the country. 95% of the customs revenues are currently collected through banks; 99% of the enterprises have registered to pay tax electronically.
Mr. Pham Tien Dzung, Director General of the SBV Payment Department, makes a presentation at the Conference
With the achieved results, non-cash payment in Vietnam has made a remarkable change when passing Singapore and Malaysia in the "cashless" race (Nikkei Asia Magazine on April 18, 2019). This is an evidence for the SBV’s right directions to promote non-cash payment.
Continue to improve the legal framework and strengthen financial inclusion
One of the key tasks that Deputy Prime Minister Vuong Dinh Hue requested the SBV and the related ministries to continue to implement is financial inclusion. The tasks include urgently finalizing the development and starting to implement of the National Financial Inclusion Strategy, thereby enhancing accessibility and utility of financial services, improving financial knowledge and skills of consumers, for the purpose of no one being left behind in accessing financial products and services.
In addition, the Deputy Prime Minister also requested the ministries and agencies to continue to improve the legal frameworks for payment activities to meet new emerging practical requirements, especially with the application of new technologies and new payment models, as a basis for building and implementing professional processes, renewing the business models in the direction of technology application; continue to effectively implement the Scheme on Non-Cash Payment Development in Vietnam in the period of 2016-2020 and the Scheme on promoting payments via banks for public services such as taxes, electricity, water use, education fees, healthcare and payments for the social security programs; successfully deploy the assigned tasks in Resolution No. 02, which assigns the banking sector to provide modern infrastructure and electronic payment services to integrate and process payments for the services in the economy; coordinate with the Ministry of Information and Communications to report to the Government on the plan to use telecommunication accounts to pay for small-valued services (Mobile-Money service); the ministries, agencies and service providers must develop their IT systems to allow them to manage in a centralized and capable way to connect and integrate with the payment infrastructure of the banking sector.
At the same time, the Deputy Prime Minister also assessed that, over the past time, the SBV has done very actively and effectively the communication and financial education work, improved banking and financial knowledge, enhanced accessibility to banking products and services for the people.
The Deputy Prime Minister hoped that, with the results achieved at this Conference, Vietnam's non-cash payment will make a giant leap forward; helping to raise the awareness of the people, the businesses and the whole society about the benefits of electronic payment and a non-cash society; thereby helping to change consumer behaviors in a more positive and beneficial way for the social development. The Deputy Prime Minister spoke highly of the spirit of efforts and active participation of the SBV, the Ministry of Information and Communications, the relevant ministries and agencies, the service providers and the Tuoi Tre Newspaper through having successfully organizied this important event.
Speaking at the seminar, SBV Deputy Governor Nguyen Kim Anh said, in the remaining time of 2019, the SBV will actively implement a number of major tasks and solutions to promote non-cash payment.
Accordingly, the SBV is developing a Decree to replace the Government's Decree No. 101/2012/ND-CP on non-cash payment which sets out some solutions to expand the scope and subjects of non-cash payment service users. At the same time, the banking sector has continued to effectively implement a number of schemes and strategies on payment activities, such as: the Scheme on Non-Cash Payment Development in Vietnam in the period of 2016-2020 enclosed with Decision 2545; the Scheme on promoting payments via banks for public services enclosed with Decision 241 of the Prime Minister.
The SBV has been focusing on implementing the assigned tasks of the banking sector in Resolutions 01 and 02 of 2019 of the Government, such as: submitting to the Prime Minister for promulgation the National Financial Inclusion Strategy; building a Fintech Regulatory Sandbox; promoting the uniform application of the basic standards "QR Code Specifications in the payment sector in Vietnam"; reporting to the Prime Minister on the pilot implementation of using telecommunication accounts to pay for small-valued services (Mobile-Money services), a service of the same nature that allows cash to be loaded into e-Wallet alternative to bank accounts. Besides, the SBV has been continuing to strongly implement modern technologies to payment activities, taking the service provision on mobile devices as the main target; coordinating with commodity/service providers to connect and integrate IT systems of these units with the payment system of the banking sector; at the same time, continuing to promote the information, education and communication (IEC) and encourage people and businesses to use non-cash payment methods.
No one being left behind in accessing financial products and services
Along with the above-mentioned solutions, the banking sector has also been paying special attention to the communication activities in order to disseminate, educate and promote modern payment products and services, gradually changing the psychology and the habit of using cash by consumers.
Mrs. Le Thi Thuy Sen, Deputy Director General of the SBV Communication Department, speaks at the Conference
Speaking at the Conference, Mrs. Le Thi Thuy Sen, Deputy Director General of the SBV Communication Department, said that in recent years, the SBV has collaborated with many media agencies to promote non-cash payments in Vietnam and to raise the people's awareness. This is a very important element to promote non-cash payments. In the coming time, the SBV will carry out the communication in accordance with the age groups, from primary school students, high school students, people in remote areas who have less access to banking services, in order to communicate on the utilities of non-cash payments, as well as how to ensure safety and security in non-cash payments, thereby encouraging and supporting people in accessing and effectively using online banking services, raising the awareness and minimizing the risks for customers when using the financial and banking products and services.
In addition, the SBV is also looking forward to coordinating with the ministries, agencies, payment service providers, payment intermediaries, socio-political organizations, local authorities and press agencies to implement the Government's schemes, including the Scheme on Non-Cash Payment Development in Vietnam, on enhancing the accessibility to financial services... contributing to the implementation of the National Financial Inclusion Strategy, with the goal that no one will be left behind in accessing financial products and services, thereby continuing to strengthen and improve the people's confidence in the monetary mechanism, policy and banking operations, promoting non-cash payment, repelling black credit, contributing to help the economy develop stably and sustainably.
LH-VA