Retail in Asia


Card payments in Vietnam to grow by 24.1 percent in 2022

The card payments market in Vietnam, which was affected by the COVID-19 pandemic, is expected to register a strong growth of 24.1 percent in 2022 supported by robust economic recovery, forecasts data and analytics company GlobalData.

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Vietnam is among one of the few countries, which have been able to control the spread of COVID-19 to a large extent supported by a well-developed public health system and government’s comprehensive testing, tracing, and isolation measures. This resulted in reduced impact on the economy, which registered GDP growth of 2.9 percent in 2020 and 2.5 percent in 2021, which reflects on card payments market as well.

Unlike many of its Asian peers such as Indonesia and Malaysia, which witnessed a decline in card payments in 2020, Vietnam registered 2.4 percent growth.

With rise in economic activities coupled with rapid rollout of vaccination programs, the card payments value is anticipated to increase further at CAGR of 18.3 percent between 2021 to 2025, to reach VND1,404.7 trillion (US$60 billion).

Source: GlobalData

“Vietnam has traditionally been a cash-based economy due to low banked population, those aged 15 and above holding a bank account, which currently stands at around 33 percent. With government and other regulatory bodies taking various steps to promote non-cash payments, the card payments market registered robust growth in the last five years,” said Nikhil Reddy, Payments Senior Analyst at GlobalData.

To bring vast majority of Vietnamese population under the purview of formal banking system and to encourage digital payments, the government in November 2021 approved a project for cashless payment development for 2021-25. As part of this, the government plans to increase the percentage of banked population, to 80 percent by the end of 2025.

To further increase card payments security and consumer confidence, the central bank mandated banks to issue only chip-based cards effective from 1st March 2021. Initiatives like these will provide a push to the country’s underpenetrated banking industry and support growth in card payments.

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“The Vietnamese payment card market is expected to register strong growth in the next five years supported by government initiatives to increase banked population and adoption of electronic payments,” Reddy concluded.