Vietnam is undergoing a transformation and moving towards becoming a cashless economy, a shift that has been driven by innovative financial solutions and public initiatives, a new report by Chiming, a market research firm focusing on Vietnam and Indonesia, shows.
The Vietnam Consumer Trends 2024 report, released in October, explores key drivers set to fuel Vietnam’s growth and opportunities, highlighting that digital payment methods are gaining dominance, and helping improve financial inclusion and accessibility.
From cash-reliant to a cashless Vietnam
The report, based on a consumer survey of over 2,100 participants, reveals that 37% of respondents used bank apps for their most recent purchases, making it the most popular payment method.
E-wallets followed at 31%, ahead of bank cards at 18%. Notably, cash usage ranked last, with only 15% of respondents relying on it, highlighting the nation’s accelerated shift away from traditional cash transactions.
This transition is further corroborated by data from the 2024 e-Conomy SEA report by Google, Temasek and Bain and Company, which estimates that Vietnam’s gross transaction value (GTV) for digital payments reached US$149 billion in 2024, growing 18% year-over-year (YoY).
These findings underscore a clear shift in consumer preference in Vietnam, a country that has historically been heavily reliant on cash, influenced by cultural habits, limited financial literacy, and a significant unbanked population, especially in rural areas.
However, the widespread adoption of smartphones, increased Internet penetration, and a booming startup ecosystem have broken down these barriers, fostering a thriving fintech landscape.
Booming adoption of fintech
Besides digital payments, other fintech innovations are also seeing increased usage and traction. For example, buy now, pay later (BNPL) transactions surged 113% in 2023, reaching US$2.34 billion. Digital lending is another fintech vertical that’s rising, reaching US$6 billion in loan book balance in 2024, up 49% YoY.
Additionally, the wealth and investing sector is seeing growth and evolution. In 2023, the number of domestic stock trading accounts reached 7.2 million, up nearly 6% year-over-year (YoY). This year, the number of domestic stock trading accounts is projected to rise by more than 20% to reach 8.7 million.
Driving this growth is the rise of wealthtech, fueled by advancements in digital technology. These innovations are transforming wealth management, making it easier to access financial advice, manage portfolios, and find investment opportunities.
This ecosystem is expanding rapidly. According to the Vietnam Fintech Landscape 2024 map by business consultant Khoa Nguyen, Vietnam is now home to 16 wealthtech companies, representing a 129% increase from the seven companies identified by local real estate financing startup FinHome in 2021.
The Vietnamese fintech landscape
Vietnam’s fintech industry has grown remarkably over the past years, reaching 220 solutions in 2024.
The payment vertical continues to dominate, with 48 companies and a share of 21.8%. It’s followed by point-of-sale (POS) terminals with 24 companies and a share of 11%; cryptocurrency and blockchain with 22 companies and a share of 10%; and peer-to-peer (P2P) lending with 21 companies and a share of 9.5%.
The expansion of fintech in Vietnam aligns closely with the country’s strides towards improved financial inclusion, which according to Pham Anh Tuan, Director of the Payment Department, at the State Bank of Vietnam (SBV), increased by 10% in a just a year, reaching a remarkable 77.4% rate in 2023.
This progress has been underpinned by strategic government initiatives, which focus on encouraging the shift away from cash and improving financial accessibility.
The National Financial Inclusion Strategy, launched by the SBV in 2020, aims to increase the proportion of adults with access to formal financial services to 80% by 2025, expand the usage of digital financial services and promote financial literacy.
The government has also launched communication programs such as “Smart Money” and “Tomorrow Bankers” to raise consumer awareness and promote access to financial services.
Most recently, the SBV released a new draft decree for a regulatory sandbox to pilot select fintech solutions. This latest version, refined through seven iterations since 2023, focuses on three areas: credit scoring, open application programming interfaces (APIs), and P2P lending, Vietnam News reported. The implementation of the sandbox will last a maximum of two years.
Adoption of fintech products in Vietnam is expected to grow further. Projections from the 2024 e-Conomy SEA report suggest that digital payments GTV will at least double to US$300 billion by 2030.
Digital loan book balance is set to soar fivefold during the same period to US$30 billion, while digital insurance is forecasted to grow fivefold to US$500 million.
Featured image credit: edited from freepik
