Report Overview

Vietnam fintech market is driven by sudden boom in digital payment applications and startups providing technologies such as digital banking, blockchain, cryptography, etc., and avorable government policies along with a tech-savvy population and increasing middle-class income.

Vietnam Fintech Market- Industry Trends & Forecast Report 2027

Vietnam fintech market was worth USD 7.23 billion in 2020 and is further projected to reach USD 23.2 billion by the year 2027, growing at a CAGR of 18.0% during the forecast period. Vietnam is emerging as the fastest-growing fintech market in Southeast Asia because of the sudden boom in digital payment applications. Moreover, startups providing technologies, such as digital banking, blockchain, cryptography, etc. are also strengthening the country’s fintech market. Furthermore, favorable government policies, along with a tech-savvy population and increasing middle-class income are anticipated to boost the growth of the Vietnam fintech market during the forecast period.

Source: BlueWeave Consulting

Vietnam Fintech Market- Overview

Fintech is a combination of the words "financial technology. It refers to the integration of computer programs and other technologies into banking and financial services to enable consumers and financial institutions to receive financing options in a new, faster way than was previously possible. Fintech leverages innovative technologies into financial services, such as artificial intelligence (AI), big data and data analytics, blockchain, Robo-advisors, etc. Furthermore, the fintech ecosystem encompasses a wide range of services, including payments, lending, wealth technology, and personal finance management.

Vietnam Fintech Market Forecast and Trends

Growth Drivers

Progressive Government Policies

Vietnam's government is extremely interested in fostering the fintech industry and implementing pro-growth government policies. The government is paying proper attention to the creation of a fintech regulatory 'sandbox' framework. The Sandbox term refers to the regulatory exemptions granted to certain fintech businesses and companies for a set period of time in order to develop and test new products, services, and models. A trial-and-error method like this fit well with the Vietnam fintech market, which is still in its infancy.

The Thriving E-Commerce Industry

A growing and deepening e-commerce market provide significant growth opportunities for the Vietnam fintech market. As consumers are spending more time on their smartphones and their consumption increases through e-commerce platforms, the need for digital payment platforms is also growing. Additionally, fintech helps e-commerce platforms by seamlessly collecting user information via various apps and services. This further enhances target marketing. Moreover, with the application of AI algorithms and machine learning, fintech can easily identify consumer purchasing patterns.

Restraints

Crunch of Specialized Personnel Due to Fintech Boom

The fintech sector is booming rapidly in Vietnam but the lack of specialized human resources is acting as a major restraint for the market growth. Similarly, fintech startups are increasing at a rapid pace, but there is a shortage of professionals who possess the knowledge and understanding of the industry to fill in the gaps within these firms. Due to this, the companies are struggling to survive and keep up with the rapidly changing global market.

Impact of COVID-19 on Vietnam Fintech Market

The sudden COVID-19 outbreak in the country provided enormous growth opportunities to the Vietnam fintech market. The dependence on payment apps amplified several folds due to the growth of the e-commerce sector during the pandemic. Additionally, the adoption of fintech services witnessed a sharp boom in the non-banking financial companies as well as microfinance institutions, after the pandemic. The banking and non-banking sector are currently focusing on expanding their customer base through these services. Furthermore, growing investment in blockchain technology after the pandemic is also providing significant growth opportunities to the market.

Vietnam Fintech Market - By Service Propositions

Based on service propositions, the Vietnam fintech market is segmented into money transfer & payments, digital lending & lending marketplaces, savings & investments, online insurance & insurance marketplaces, and others (e-commerce purchase financing, etc). Among these, the money transfer & payments segment holds the largest market share. There are already several companies that have established their markets as payment applications, including MoMo, Nextpay, Zalopay, etc. The flourishing e-commerce sector and the growing need for mobile wallets and payment apps among the public to make instant payments are further driving the growth of the money transfer & payment segment.

Vietnam Fintech Market - By Application

Based on applications, the Vietnam fintech market is segmented into banking, insurance, and securities. Among these, the banking sector accounts for the largest market share. Fintech is carrying forward the rapid digitization in banking as banks shift to a fully automated environment. Fintech companies in Vietnam provide banks a platform for connecting with their customers more efficiently. Moreover, they offer security, access, and promotional features that are increasing its adoption in the banking sector, propelling its market growth.

Vietnam Fintech Market - By Deployment

Based on deployment, the Vietnam fintech market is segmented into cloud and on-premise. The cloud segment accounts for the largest share of the Vietnam fintech market due to the higher level of security offered by cloud-based technology. It allows the fintech companies and banks to establish effective and secure services for lending, payment, and fraud detection. Moreover, cloud technology eliminates the need for physical hardware and software setup and enables companies to scale up and down easily on a cloud infrastructure while remaining compliant with regulations.

Vietnam Fintech Market-Competitive Landscape

The leading players in the Vietnam fintech market are MoMo, Nextpay, Zalopay, VayMuon, Kilimo Finance, VNPAY, Coin98, Rikkei Finance, VIU APP, Bizzi, Fundiin, and other prominent players.

Since Vietnam's fintech market is still growing, it is highly fragmented among many fintech startups and companies. The startups are going the extra mile to make space for themselves in the lucrative market with the launch of a wide range of apps and services. They are also counting on advertisement and marketing strategies to create brand awareness among potential consumers. Furthermore, the adoption of competitive strategies, such as partnerships, mergers, acquisitions, collaborations, etc., is also prominent in this market.

Recent Developments

In November 2021, GIMO, Vietnam’s fintech startup offering on-demand pay for blue-collar workers, announced to have raised USD 1.9 million in the seed funding round led by Singapore’s Integra Partners.

Scope of the Report

By Service Propositions

• Money Transfer and Payments
• Savings and Investments
• Digital Lending & Lending Marketplaces
• Online Insurance & Insurance Marketplaces
• Others (E-Commerce Purchase Financing, etc.)

By Application

• Banking
• Insurance
• Securities

By Deployment

• On-cloud
• On-premise