The fintech industry has seen a global boom over the past decade, and Vietnam is no exception. The fintech transaction value in Vietnam currently stands at USD 34.50 billion. This figure is expected to grow to USD 63.87 billion by 2028, and investors are taking note of the potential of the Vietnamese Fintech industry.

Quite a few Fintech companies operate in Vietnam and offer services such as digital payments, P2P lending, and blockchain-based platforms. As a foreign investor looking to enter the Vietnamese market, the Fintech industry provides plenty of attractive options.

Despite the current growth of Fintech, Vietnam still has many sectors in Vietnam that rely on cash transactions. Foreign investors can fill gaps by offering solutions for sectors that don't have dedicated Fintech solutions. Investors can also use Vietnam as a base to expand into the broader Asian Fintech markets.

However, setting up a Fintech in Vietnam is not as simple as establishing other types of businesses. Zora Consulting understands the complications of foreign investors who want to set up operations in Vietnam. We can help you establish a Fintech company or any other business in Vietnam to benefit from the country's unsaturated markets.

If you want to know more about Vietnam Fintech growth and opportunities, we suggest you read until the end.

Vietnam's Fintech industry compared to other ASEAN countries

As stated above, Fintechs in Vietnam have seen a sharp rise; however, it is nowhere near the other ASEAN countries. Other Singapore, Indonesia, Malaysia, Thailand, and the Philippines have a significantly larger number of Fintechs than Vietnam. Vietnam has the lowest number of fintechs out of all the ASEAN 6 members, with Singapore leading the pack.

As of 2021, Singapore had 1350 registered fintechs, while Vietnam had just 188. The Philippines is slightly ahead of Vietnam, with 268 Fintechs registered as of 2021. So, compared to other ASEAN countries, the Vietnam fintech sector is still in its infancy.

As a foreign investor, the relatively smaller number of Fintechs in Vietnam serves as a low-competition market. While the other ASEAN countries already have a high number of fintechs serving different aspects such as P2P lending, digital wallets, and blockchain, that is not the case with Vietnam.

So, if you are planning on entering the fintech sector in an Asian country, Vietnam offers a favourable environment with high growth potential.

Reasons to enter the Vietnamese fintech market

By now, we have already established that the Vietnam fintech industry is largely untapped with plenty of opportunities. However, the low competition in the Vietnamese fintech industry is just one of many reasons that make it ideal for foreign investment. Here are some reasons why investors should consider investing in the Vietnamese fintech industry:

Per capita income growth: As the per capita income grows, so does the need for new Vietnam Fintechs. Along with the increase in per capita income of the Vietnamese population, the number of internet users is also rising, creating a perfect scenario for companies that want to offer digital financial solutions.

Vietnamese population is looking to spend the surplus income thanks to the rise in per capita income. Vietnam fintech solutions tailored to the Vietnamese market's needs have the opportunity to integrate into the everyday life of the population and capture a significant market share in the process.

Untapped market: Most of the fintechs in Vietnam focus on providing mobile payment solutions. This leaves other fintech solutions primarily untapped. We will discuss all the sectors fintech sectors and products with low competition in the next section.

Banks are rapidly adopting digital banking: Over the past 6 years, Vietnamese banks have realized the importance of digital banking. Since 2017, Vietnam has seen that banks are gradually rapidly adopting new technologies to facilitate their customers and improve their services.

This shift towards digital banking in Vietnam opens up opportunities for B2B fintech companies. As banks adopt financial technologies such as QR code scanning, E-wallets, and advanced finance management software, the need for new fintechs will only rise.

Since banks are primarily concentrated in major cities, they leave the rural areas without any reliable financial services. That is where fintechs come into play by offering financial solutions for the majority of Vietnamese citizens who still rely on cash.

What are some attractive fintech options to invest in Vietnam?

As mentioned earlier, most of the Fintechs in Vietnam have been serving mobile payment solutions and e-wallet consumers. This leaves many other fintech categories without any significant competitors. Here is a list of some low-competition fintech sectors in Vietnam:

• P2P lending
• Wealth management platforms
• POS
• Data analytics

Vietnamese government's initiatives to support fintech sector

The government of Vietnam realizes the importance of fintech in the country. State Bank of Vietnam set up a special committee dedicated to developing the fintech industry in the country in 2017.

This committee is setting up regulations for the fintech industry and creating more growth opportunities. Ultimately, the Vietnamese government wants to reduce the percentage of cash transactions and promote cashless payments. And fintech companies can offer solutions that align with the government's vision.

The steering committee for the fintech industry launched a five-year plan in 2021. It encourages companies from various fintech categories to contribute to their goal of a cashless economy. The Vietnamese government aims to increase the percentage of cashless transactions in e-commerce by 50% within 5 years.

So, for any Fintechs looking for the right time to enter the Vietnamese, now is the right time to invest in the country's fintech sector.

Conclusion

Vietnam has a young and tech-savvy population ready to adopt new fintech solutions. The current stats of the Vietnamese fintech sector and government initiatives point towards further growth potential.

Zora Consulting can help you establish your Fintech in Vietnam by offering direct support in every aspect. From business establishment and recruitment to tax and accounting, we provide complete solutions to companies trying to enter the Vietnamese market. So contact us today to discuss your investment goals with our experts.