3 ways to encourage online payments in Vietnam’s e-commerce market


While e-commerce is booming in Vietnam (from $300 million in 2011 to an estimated $2.5 billion by the end of 2015), the online payments market has been slow due to the popularity of COD (cash-on-delivery).

There are 4 main reasons for this:

1. Old habits die hard- Vietnam's consumers are used to paying for online goods via cash on delivery. Customers have not yet developed the habit of using credit cards and merchants don't encourage its use, given that they are hesitant to pay transaction fees.

2. Lack of trust in online service providers

3. Low credit card penetration

4. Generation gap—while young people are more willing to spend money online, they don't have much purchasing power yet and the older generation is not willing to do so.

Despite these barriers, there are more and more service providers emerging in Vietnam which may slowly change the trend by giving consumers a good reason to pay online.

1. Make it more convenient to pay online:

A good example is Paybill—a bill payment service that allows homeowners to pay electricity, water, telephone, internet and cable bills online, as an alternative to paying utility collectors at the door—which is still common in Vietnam. By giving consumers a more practical solution to pay their bills, it gives consumers a more practical reason to use online payments.

2. Give a good discount:

Group buying and daily deals sites have brought Asian consumers online because of the attractive deals offered, overcoming consumer distrust of the virtual economy. According to Hung Huynh from IDG Ventures Vietnam, group buying in Vietnam grew 700-800%.

3. Create a  solution that co-exists with cash

Ngan Luong, one of Vietnam's leading online payment startups, is the first online payment platform that supports cash, integrating COD within their own business model by partnering with ShipChung.vn, a shipping gateway in Vietnam. In this partnership, Ngan Luong serves as an online bank that helps ShipChung so the whole COD payment volume goes through Ngan Luong.

Have insights and expertise in Vietnam and Thailand? Get in touch with alyssa.reinoso@terrapinn.com for speaking opportunities for Total Payments Asia, an event to be held this October 8-10 in Bangkok.


  1. Rosa

    The developpment of Online payment Systems that are more trusted and used by Vietnamese would be a very positive thing for the country and its trade. The old-fashioned paying systems are slowing down the transactions and the economy, especially now that online buying has become important. Payment service providers need to show customers that they can be trusted and that online paiement is as safe as paying the delivery cash.

  2. Elena

    I am not a specialist when it comes to the situation in Vietnam, but I am here simply to say something about online payment providers in general. When it comes to online payment they are as far as I am concerned the best option. Indeed they set up secured payments and help to gain customers’trust. Of course you have to pay some fees, but it is nothing compared too what you gain in the end. You just have to choose a Provider that ensures quality and affordable prices. And business is so much faster with their help, so I could only recommend that people in Vietnam use them more.

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