Vietnam is one of the most promising markets for fintech in Southeast Asia, with the payments segment continuing to lead the way. While talk of Vietnam going truly cashless is premature, there is a steady transition to digital payments in the country. Data compiled by the State Bank of Vietnam show that non-cash payment transactions increased by 63.3% in volume and 41.45% in value in January, compared to the same period in 2023. Many Vietnamese banks now have over 90% of their transactions conducted via digital channels.

Another metric which is useful for assessing the state of Vietnam’s financial digitization is e-wallet use. A report published in February by Hanoi-based FiinGroup found that the number of active digital wallets in Vietnam will jump 40% to 50 million by the end of 2024. Since 2018 the number and value of e-wallet transactions have respectively risen by 80.4% and 83.5% on an annual basis.

According to Statista, Vietnam in 2022 was No. 3 in Southeast Asia with regards to overall e-wallets in use, behind only Indonesia and the Philippines, both of which have larger populations. Statista predicts that by 2026, the number of active e-wallets in Vietnam will grow to 67.6 million.

In Vietnam, the top three e-wallets by users are Momo, Shopee Pay and VNPay. Each of these e-wallets has a distinct business model. VNPay is focused on boosting its network of partners to become the favored payment option for retailers, while Shopee is attempting to harness synergies from its e-commerce ecosystem. For its part, MoMo appears to be going down the well-worn but rather fraught path to super app status.

MoMo became a unicorn at the apex of the pandemic’s fintech funding surge, achieving a valuation of US$2 billion in December 2021. Since then, MoMo has continued to grow steadily and recorded revenue of US$355 million in 2022, an increase of 18% over the previous year. However, it is not clear how well its super app strategy is panning out. Outside of China, this business model has proven difficult to replicate because of e-wallet fragmentation – something that Alipay and Tenpay never faced – and different consumer preferences.

We observed with interest the tie-up of Grab and MoMo announced in Nov. 2023 as the Singapore-based company has been one of Southeast Asia’s biggest proponents of the super app business strategy. Under the agreement, MoMo’s payment solution will be integrated into the Grab app. “We welcome MoMo to our super-app platform,” Alejandro Osorio, CEO of Grab Vietnam said in a news release.