FINTECH
IN VIETNAM: CURRENT SITUATION AND SOLUTIONS
ABSTRACT
The Financial Technology
(Fintech)
market in Vietnam has experienced remarkable growth, reflected in the
increasing number of Fintech companies and the rising value of cashless
transactions. However, alongside these achievements, several limitations and
challenges still remain. Based on an analysis of the current situation of the
Fintech market in Vietnam in recent years, this paper proposes several
solutions to promote the development of the Fintech market in the coming period.
1. Introduction
Along with the development of the Fourth Industrial Revolution (Industry
4.0), an increasing number of consumers are using products and services
provided by Fintech. The term “Fintech” is commonly used to refer to all
companies that utilize the internet, mobile phones, cloud computing technology,
and open-source software to enhance the efficiency of banking and investment
activities.
The emergence of Fintech has transformed the landscape of the financial
services industry with advantages in terms of speed, simplicity, efficiency,
security, privacy, and potential. This development has enabled Fintech firms to
share more information and services with customers, giving them greater control
and decision-making power in financial transactions and investment activities.
This article provides an overall perspective on the current state of
Fintech in Vietnam and, based on that, proposes several recommendations for
government authorities, particularly the State Bank, regarding the development
of Fintech in Vietnam.
2.The Development of Fintech in
Vietnam
Achievements
Commercial banks have advantages in terms of scale, extensive networks,
and a long-established customer base with large data systems; therefore, they
often experience a certain technological lag compared to Fintech companies. To
shorten this gap, Vietnamese commercial banks have been actively promoting
cooperation with Fintech companies to provide digital products and services
based on multi-channel platforms, ensuring richer customer experiences while
helping businesses reduce investment costs. Examples include the cooperation
between Vietnam Technological and Commercial Joint Stock Bank (Techcombank) and
Fastcash; Vietnam International Bank (VIB) and Weezi Digital; and VietinBank
and ON Company (UK), as well as BE Group (Sweden).
The connection between banks and Fintech companies has contributed to
upgrading and developing modern payment infrastructure that operates safely and
efficiently, with strong capabilities for connectivity and integration with
other systems. It has also promoted electronic payments in the government
sector and public administrative services.
3.Limitations and Challenges
Despite the encouraging results, the Fintech market in Vietnam still
faces several limitations and challenges, reflected in the following aspects:
Ø
Legal regulations: The rapid development of Fintech services has caused the legal framework
to lag behind. Fintech products are constantly being innovated and developed;
however, whether their operating methods or newly introduced products comply
with existing legal regulations remains an issue that requires further study.
As a result, fraudulent activities such as impersonating banks to deceive
customers may occur, causing financial losses and undermining customer trust.
Ø
Training capacity of banks: Fintech-related work requires relatively high professional and
technological competence. However, the current training systems of banks in
Vietnam have not yet fully met these requirements.
4.RECOMMENDATIONS
To further promote the development of the Fintech market in Vietnam in
the coming period, several solutions should be implemented:
(i) The Government should continue implementing policies,
programs, and projects to create a more open environment and favorable
infrastructure for diversifying Fintech products. At the same time, it is
necessary to improve the legal framework and adjust the legal system to be more
flexible, particularly in line with technological innovation.
(ii) Regulatory authorities should focus on the economic
functions of Fintech products, specifically their fundamental risks (such as
credit risk, liquidity risk, solvency risk, and operational risk), rather than
merely their digital form.
(iii) Strengthening cooperation between
Fintech companies and banks to create added value for customers. Such
cooperation is considered a prerequisite for improving users’ access to
financial and banking services in Vietnam in the context of digital development.