Glimpse of the future: Cash going out of fashion

"Those who have paid their electricity bills using mobile banking certainly do not want to be bothered during their lunch breaks by bill collectors ringing their door bell. I assure you mobile banking users do not want to go back to using cash," Pham Tien Dung, head of the Payment Department under the State Bank of Vietnam, announcing the 2020 Cashless Day on Tuesday, said.

The economy is seeing a shift toward cashless payment, he said. Internet banking and e-wallet use rose by 37 percent and 86 percent last year.

The use of ATMs decreased significantly as a concomitant of the soaring popularity of electronic banking.

Electronic payments for public services also increased significantly as 50 banks linked up with customs and tax agencies as of the end of last year, resulting in more than 95 percent of customs duties and 90 percent of power bills being paid online. Some hospitals reported cashless transactions of 35 percent.

According to a recent survey by Visa, 74 percent of Vietnamese expect their cashless transactions to increase in the next 12 months since the acceptance of cashless payments is increasing and carrying cash will no longer be needed.

Some 37 percent of consumers use contactless payment technology that allows users to simply tap their cards on terminals to make payments, with 42 percent of it done through mobile phones.

Some 85 percent of people making contactless payments do so at least once a week.

The central bank’s Dung said 78 organizations offer Internet payment services, 49 offer mobile payment services and 34 non-banking organizations are licensed to provide payment intermediary services.

Building a digital ecosystem to catch up with this trend would remain an imperative, and banks that are unable to meet the growing demand for cashless payments would lose customers, he added.