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Feb, 2022     

Vietnam Fintech: Closing the Unbanked Gap

Digital banks can help to achieve the government’s target to reach 80% banked population by 2025


1. Digital payments dominates Vietnam’s FinTech. However, digital lending and banking are expected to gain share by 2025

Currently, digital payment players dominate Vietnam’s fintech market. However, we expect that by 2025, other services (e.g., digital lending and digital banking) will start to capture a higher share of the market, in terms of transaction value.

Investors remain keen to explore opportunities in digital banks and trading platforms. Earlier this year, in January, several funding rounds were being raised.

Fintech Market Split by Transaction Value, In percentage (%)

2. Digital banks can help to achieve the government’s target to reach 80% banked population by 2025

The government plans to achieve 80% banking penetration by 2025 from a relatively low base of 45% in 2020. The digital banking industry can play a supportive role here by offering their quick and convenient registration processs to rapidly onboard new users.

Meanwhile, some commercial banks have launched their own digital banking services to keep up with the trend. This trend creates a suitable opportunity for new digital players to collaborate with the traditional banks to have an omni-channel presence and rapidly reach a wider market.

Banked and Unbanked Population, In percentage (%)

Note(s): 1Based on Vietnam’s government target, 2The list is not exhaustive, 3Time claimed by the players

3. SMEs present a significant opportunity for fintech offerings

More than 95% of the total available enterprises in Vietnam are categorized as SMEs. This segment provides a large opportunity for digital lending, as it contributes to almost 40% of the economy. Accordingly, fintech offerings for SMEs can play an important role in helping the overall economic ecosystem.

4. Aggressive focus on retail and services SMEs can help to tap into the biggest part of SME loans

Retail and services account for more than 60% of the total SME loans. Accordingly, by accelerating digital lending offerings to these two categories, fintech players can capture a significant portion of the SME lending opportunity.

SMEs Loan Needs by Sector, In percentage (%)