Oppotunities and challenges for fintech in Vietnam when Ho Chi Minh City aims to become fintech hub

Ho Chi Minh City aims to become fintech hub

In recent years, the development of the fintech market in Vietnam is very exciting and bustling. A series of large projects have become the unicorn of the whole region and emerged as a phenomenon (typically MoMo and VNPay - 2 major partners of FinFan).

The common point of these projects is that its headquarters are all located in Ho Chi Minh City. So, what advantages and disadvantages will be turning Ho Chi Minh City into a fintech hub bring to the fintech market in Vietnam? Let's find out with FinFan through the following article.

The rapid development of the fintech market in Vietnam in recent years

Not only MoMo and VNPay, other fintech giants have also been running the momentum for their own development.

Typically, in some other fintech models that are not e-wallets, companies in the field of digital banking have also made rapid breakthroughs, bringing a new breeze to the movement of developing and digitizing traditional banking services.

The story of Timo is a prime example in the development of this fintech model. From that success of this digital bank, traditional banks have begun to digitally transform their banking system to provide the best services for GenZ customers.

Not only that, in the field of wealth management, fintech companies have also made great strides to be able to provide customers with wealth management solutions as well as investment from very low capital (only from 50,000 VND) from companies like FinHay, Infina, etc.

In addition, the continuous growth of remittances to Vietnam over the years is also a good signal for some companies providing this service to be more confident in their development journey to give customers the fastest and most economical experience in the process of remittance to Vietnam.

FinFan is one of the pioneers to implement the above service and during our nearly 10 years of development, we have been cooperating with many major international money transfer partners such as MoneyGram, Remitly , SendWave aims to bring the most effective solution to their own expatriates abroad.

Oppotunities and challenges for fintech in Vietnam when Ho Chi Minh City aims to become fintech hub.

Oppportunities for fintech in Vietnam

Ho Chi Minh City has long been the largest economic center of Vietnam and is always the first destination of some foreign businesses, entrepreneurs and investors when they set foot in this country shaped like S.

Therefore, placing Ho Chi Minh City as a fintech hub will greatly help in attracting foreign investment as well as international development cooperation of businesses in this field.

Moreover, according to the writing of Vietnamplus on June 18, 2023, HCM City will also continue to invest and effectively exploit technology incubation centres at universities, hi-tech parks and the Quang Trung Software Park to form a sustainable startup ecosystem.

The city has also implemented many important programmes and projects such as the digital transformation programme, a project on turning HCM City into a smart city and the one to support the development of businesses and information technology - communication products in the 2020-2030 period, he noted.

One of the three types of data that the data management strategy has issued, financial business development has been mentioned as a guideline for the above strategy to be implemented in the most successful way.

The above data is enough to bring an open and very potential market for the fintech field to develop in this fertile land.

Challenges for fintech in Vietnam

Putting too much resources into Ho Chi Minh City will lead to a labor imbalance and affect the overall development of the country.

What if one day Ho Chi Minh City is overloaded and companies cannot expand their scale? Moreover, putting too many eggs in one basket may lead to cities or provinces that are not as developed as Ho Chi Minh will suffer technological disadvantages as well as investment capital will not be poured into cities and provinces. that province.

This makes it difficult for some people from the unbanked and underbanked classes (who are from poor rural areas) to have access to modern financial technologies and it will be difficult for them to deal with their financial problems.

Despite knowing that current technology can cross borders and is not space-critical, the dissemination and education of the market about new technological innovations is still a problem today.

This will cost fintech companies more budget for appropriate communication campaigns to reach the public and allow them to accept the services that these companies provide while they are in Ho Chi Minh City and those who have problems come from other provinces.

In short, turning Ho Chi Minh as a fintech hub is a necessity for Vietnamese fintech to have the opportunity to develop and reach out to the world.

However, calculating how to not lose the balance of the labor ecosystem and how to educate the market towards technological advancements have always been two difficult problems that Vietnam's fintech industry need to solve.