Online Payment in Vietnam Remains Limits

 

Assessing the development tendency of the e-commerce, Deputy Director of the E-commerce Department Tran Thanh Hai quoted a recent survey into 2,000 Vietnamese enterprises as saying up to 98.3 per cent of enterprises ha websites to introduce their businesses, 62.5 per cent introduced their products and services. Only 27.4 per cent of websites have e-commerce transactions (mainly online order). However, only 3.2 per cent of websites allowed online payment.

 

Hai added that 91 per cent of enterprises connected to the internet, nearly 60 per cent using ADSL and 75 per cent using LAN networks. But, they mostly use websites and the internet to surf, send email, administer website, train online and manage human resources.

 

The E-commerce Department also gave information from Visa’s report: A total of 34,000 e-commerce transactions were made through Visa cards issued in Vietnam from June 2004 to June 2005. The transaction value was US$5.7 million and of course this amount was paid for foreign websites.

 

Several banks took initiative in investing in online payment methods but received humble results. Recently, the Eastern Asia Bank opened EAB Electronics, allowing online transactions on its own account on internet and SMS. The online payment portals of Vietcombank and EAB and other banks will be put into service soon.

 

In fact, Vietnam has some 2.5 million bank card holders serving by 20 banks but only 2 per cent of them make payment through internet. The core reason leading to this actuality is the awareness of the people and enterprises about the sales through the internet.

 

The second hindrance is resulted from the State management authorities and legal systems. Vietnam Airlines’ e-ticket sales method is a clear example of this. According to estimates by consulting experts, the cost to issue an e-ticket is equal to 10 per cent of paper ticket. In addition, the purchase of e-tickets is much more time-saving than buying a paper ticket. Both passengers and Vietnam Airlines find benefits from this form. However, this form is almost impossible to carry out because of tax barriers. The tax sector requires Vietnam Airlines to show receipt invoices for its e-ticket sales if it wants a discount. This means Vietnam Airlines find it hard to carry out its e-ticket service.

 

Legally, the Government has ratified two programmes related to this issue: The Overall E-commerce Programme until 2010 and the Programme to Assist Enterprises to Apply IT. The Electronic Transaction Law took place from March 1, 2006 and the government’s issuance of the Decree No. 57/2006/ND-CP dated June 9, 2006 turned green lights for the wide development of e-commerce model in Vietnam. However, the instructive documents for the implementation of the law need more discussion.

 

At present, the online payment is no longer a choice but a tendency of enterprises. It is time enterprises had plans for investing e-commerce development to support their businesses, not discussing the necessity to apply e-commerce or not. The pressure from economic integration will force Vietnamese companies to change the mode of payment. The absence of online payment in an enterprise means losing to its rivals. While the State agencies are building their overall development strategy for a legal environment, e-commerce contents and online payment mechanism, enterprises should not wait but seek and grasp opportunities and take initiative right away.