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Cashless Payment to Become New Consumer Behavior due to Covid-19

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Free transactions via e-banking have been offered by many banks in Vietnam to boost the demand of using online payment services.  

Especially since the COVID-19 outbreak, people have limited outdoor activities and therefore most transactions are carried out online. The electronic channels would include debit cards, mobile payments, internet banking, e-wallet and more. They are also more likely to use non-cash payments to limit the spread of virus.  

The pandemic has created huge opportunities and challenges for Vietnam’s financial services industry to raise awareness and acceptance of cashless payment method. This is the very first step of shaping new consumer behavior. 

 

Opportunities 

Digital Infrastructure Improving 

Cashless payment would not be able to go nationwide without the network of correspondent banking networks, fintech companies, mobile money services, and other digital payment infrastructures. It has opened great chance for Vietnam’s financial services industry to comprehensively develop when the resources and efforts of all private and public sectors are required to promote the change. 

COVID-19 in current context is such an unpredictable event. The pandemic, at the same time, has facilitated Vietnam’s socio-economic development and reinforced the country’s flexibility, creativity, quick adaptation and prompt recovery. Together with the coming growth of cashless payment, it will help improve digital infrastructures for rural and remote areas. 

The enhancement of ecommerce 

This new form of payment will also push more businesses to engage in the financial switching and clearing the electronic market which is a huge support to develop digital payment infrastructures. The development of financial services industry also leads to the enhancement of e-commerce and directly benefits cashless payment method. 

 

Challenges 

Non-cash payment method has substantially changed Vietnamese consumer habits. The transaction is therefore required to be more effective in terms of speed and cost, and the digital infrastructure will be in great need of being innovated. 

As mentioned above, the transition from cash to non-cash payment would require a comprehensive network of both private and public sectors to meet the needs of the market. It depends on whether or not the country can meet all the conditions to speed up the economy, develop the electronic payment system and accelerate a comprehensive financial universalization throughout the country.