Expectations for Ho Chi Minh City to become a launching pad for Vietnamese fintech

In the article “Private economic development – a lever for a prosperous Vietnam”, General Secretary To Lam twice mentioned “fintech services” as a high-tech industry and an important channel for mobilizing important capital for development.

The role of fintech has been clearly defined by the leader. This is also a recognition of the achievements, efforts, and potential of Vietnamese fintech enterprises over the past years.

Developing cashless payments, promoting digital economy

The term “fintech” refers to the application of technology to serve financial services. Fintech businesses provide technological solutions in the fields of finance and banking such as e-wallets, payment intermediaries through mobile payment applications, QR codes, etc.

These technological solutions not only make the customer experience easier, faster, and more convenient, but also help a large segment of the population access the banking and financial system.

The greatest achievement of Vietnam's young fintech industry is to help increase the connection of banks and financial services to those who do not have full access to banking services (understood as groups that do not have access to or have access to but do not fully utilize financial services - also known as the underbanked population).

Looking back at 2021, Vietnam was among the top countries with the highest underbanked population in the world (69% - top 10 in the world). The main reason comes from the lack of connection in terms of geography, technology, and needs between the financial system and the people.

Fintech companies not only allow people to use technology to bridge geographical gaps, but also diversify products for users, providing the underbanked population with more financial products at low costs, while still ensuring safety and legality. These products can be mentioned as allowing users to invest in stocks at the lowest price, and buy insurance with optimal time.

This is not only good for users, but also helps to unlock a significant source of capital that was previously untapped.

“Fast, convenient, cheap, legal” are the criteria to evaluate a good fintech system, helping to increase a country's financial inclusion rate.

Fintech barriers that need to be removed

However, the development of fintech in Vietnam is not without its difficulties and unfortunate misunderstandings. Currently, a not entirely accurate but quite popular view is that fintech products and services are easily exploited by criminals for illegal activities.

When incidents occur, media and stakeholder attention often focuses on fintech businesses, sometimes without clearly identifying whether they are victims of exploitation or potential partners in solving the problem. This can lead to misunderstandings, affecting the sustainable development of the industry.

We hope that regulators and stakeholders will consider and clarify the role of fintech businesses in this context, in order to build a safe, transparent and effective digital financial environment.

Specifically, it is necessary to establish a close coordination mechanism in which the responsibilities and roles of each party are clearly defined. This not only helps fintech become a strategic partner in monitoring and preventing illegal behavior but also promotes the sustainable development of the digital financial ecosystem, bringing long-term benefits to the community and the economy.

With this cooperation, fintech will contribute more actively to the goal of national digital transformation, towards a safe and inclusive financial future.

In addition, the view that “enterprises have the right to do anything that is not prohibited by law” also needs to be truly spread and become the common spirit of the whole society. Fintech enterprises always try to find good ways of doing things and new fields even when the law does not clearly stipulate, as long as they do not violate the prohibitions of the law. That is the necessary spirit of an entrepreneur.

Finally, to achieve the above two issues, we expect a clear and distinct legal system, with clear standards, criteria, and timelines.

At that time, the role of fintech enterprises was identified and could continue to play the connecting role that we have been doing, and promote the potential that the fintech industry can promise, contributing to the development of Ho Chi Minh City in particular and Vietnam in general.