Among the ASEAN member countries, Vietnam currently owns 24 incubators and research facilities, according to a recent study called “ASEAN FinTech Census 2018” by Ernst & Young (EY), one of the world's four largest accounting firms. And is ranked second. Singapore leads the ranking with 52 facilities.
Fintech market in Vietnam
Vietnam has emerged as an important market for fintech developers due to its younger average age, rising consumer spending, and the proliferation of smartphones and the internet. At present, 90% of transactions in Vietnam are done in cash, so fintech companies are mainly focused on developing payment services. Approximately 47% of Vietnam's Finetech startups focus on payment systems, making it the hottest area.
According to EY, Vietnam currently has about 77 fintech companies.
According to the Topica Founder Institute, Vietnam's fintech startups in 2016 totaled US $ 129 million in investment, accounting for 63% of the total investment in startups.
The fintech market reached $ 4.4 billion in 2017 and is expected to reach $ 7.8 billion by 2020.
Problems in expanding the fintech market
One of the major challenges facing Vietnamese fine tech startups is the lack of government policies and regulations. Moreover, Vietnamese banks are reluctant to deal with fintech companies. Despite FinTech's technology allowing Vietnamese who do not have a bank account to become potential customers, the bank's reluctance seems to be unaware of Fintech's value.
According to EY, Vietnam's start-ups are facing a lack of talent and money as a problem.
The future of the market by fintech companies
The whole thing about Vietnam's fintech market is that fintech companies look to a very optimistic future in terms of market expansion and revenue growth.
According to EY, 89% of Vietnamese fintech companies think their users are very enthusiastic about their services, and 87% believe the market will continue to grow for the next 12 months. is showing.
The future of Vietnam's fintech market
The fact that Vietnam's main form of transaction is cash and the increasing popularity of smartphones, and these two points have given Vietnamese fintech companies a great opportunity to provide payment and settlement services to consumers. I will.
Fintech will continue to attract large amounts of venture capital funding due to its high growth potential in Vietnam. In addition, vibrant start-ups are expected to see more mergers and mergers and acquisitions as they expand their market cap and discover new technologies.
The growth of the fintech market will require investment, new technology and widespread smartphone adoption, but also a strong legal framework. The Vietnamese government has begun to take notice of the rise of fintech, establishing a steering committee on fintech last year and announcing plans to reduce cash transactions to less than 10% of total transactions by 2020.
The Vietnamese government will continue to work closely with the public and private sectors to acquire new technologies, including fintech, expand access to information technology among Vietnamese citizens, and promote the introduction of fintech throughout Vietnam. It is expected that a legal framework will be put in place.
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