Vietnam IT industry is more than just outsourcing

By Dat Nguyen April 21, 2019 | 05:00 pm PT

Major technology companies in Vietnam have been developing and coming up with solutions to apply AI in real life. Photo by Shutterstock/Alexander Supertramp

Vietnam is known as an outsourcing software destination but local IT businesses are expanding into other technology areas such as AI and fintech.

For years, MNCs like Intel, IBM, Samsung Display, Nokia and Microsoft have chosen Vietnam to outsource their software projects. Last year, Vietnam exported $3.5 billion worth of software, up 11.6 percent from 2017, according to the Ministry of Information and Communications.

But a recent report by HCMC-based IT recruiting firm TopDev showed that local companies are branching out to different areas also.

Artificial Intelligence (AI) is one of them. Technology giant FPT, telecommunications giant Viettel and online gaming giant VNG in recent years have been developing and coming up with solutions to apply AI in real life.

Conglomerate Vingroup has also announced it would establish an AI research institute as part of its technology arm VinTech.

Big demand has resulted in a higher pay check for AI engineers in the country, TopDev says. Its data shows that an AI engineer or machine learning engineer could earn up to $1,678 a month, 21 percent higher than the average salary for an experienced IT developer of $1,318.

Fintech is another area believed to have big potentials in Vietnam, as the development of mobile payment services could increase the number of cashless payments in the country.

Since last October, ride-hailing app Grab has partnered with e-payment Moca to allow users to pay electronically for their rides. Another mobile payment service, Momo, reached 10 million users in Vietnam last year.

There are at least 64 companies providing fintech services in the country, but this figure is still lower than 490 in Singapore, 262 in Indonesia and 196 in Malaysia, TopDev said, adding that this means there are still opportunities in this area for large companies and future startups in Vietnam.

Vietnam's fintech market reached $4.4 billion in 2017 and is estimated to grow to $7.8 billion by next year, according to consulting firm Solidiance.

The report added that other IT areas that Vietnamese businesses are expanding into are blockchain, software as a service (SAAS) and e-commerce.

IT is a growing industry in the country which is promoting the development of Industry 4.0. A report by recruitment firm ManpowerGroup released in January said that IT will be the industry with the highest recruitment demand this year with 14 percent increase compared to last year.