Vietnam is targeting a virtually cashless economy

10:09 | 09/02/2017 Finance - Banking

(VEN) - A government-approved project to sharply reduce the use of cash in the economy aims to keep cash transactions at under 10 percent by 2020, to reach 200 million transactions a year through points of sale, promote electronic payments and boost the use of bank cards.  

Strengthening electronic transactions

Non-cash payments continued to grow strongly in 2016, in line with the global trend. A range of diverse products has replaced cash, contributing to ensuring safety and convenience, while better meeting the needs of customers.

The development of non-cash transactions in Vietnam during the 2016-2020 period, recently approved by the government, foresees the creation of 300,000 points of sale executing around 200 million transactions a year.

Promoting electronic payments in e-commerce is also included in the project. Accordingly, 100 percent of supermarkets, commercial centers and modern distribution sites will allow e-commerce transactions, 70 percent of water, electricity, and telecom providers will accept non-cash payments, and 50 percent of individuals and households will use non-cash transactions.

Preventing tax evasion

Multiple solutions are needed to promote the development of electronic payments. Administrative measures are also required, combined with incentives for people and business to use e-commerce, and policies to encourage electronic payments in tax collection and service fees.

To implement the project on schedule, the government has also requested other relevant authorities to issue appropriate mechanisms and policies on service charges in order to encourage non-cash payments. It also aims to strengthen control of payment and invoice issuance to prevent tax evasion and to issue legal regulations on electronic records.
Reviewing, amending and supplementing legal documents for the opening and use of bank accounts, promulgating regulations in terms of the purchase and sales of real estate and other valuable assets through non-cash payments, and developing retail payment systems and services are also necessary.

The project on non-cash transaction development in Vietnam during the 2016-2020 period clearly includes the enhancement

of electronic payments for public administration services. It also stipulates information exchanges between agencies in the

finance sector (the Vietnam State Treasury, the General Department of Taxation and the General Department of Vietnam

Customs) and the banking system to better meet the requirements of state budget revenues by electronic methods.

Duy Minh