1. Key findings from the report:

From a cash-reliant country in Asia, Vietnam has undergone remarkable growth in embracing cashless payments, especially the acceleration of credit card usage in the past 5 years.

Despite a temporary slowdown in 2023 following weakening consumer demand surrounded by unfavorable economic conditions, the credit card market sustained double-digit growth in terms of both active card volume and transaction value. In the first half of 2023, the number of credit cards in circulation multiplied by 2.4 times compared to 2018 and the transaction value via credit cards increased by 35% p.a.

The market has seen a significant boost from domestic credit cards, with their circulation increasing approximately 4 times over the last 5 years. This growth can be attributed to the widespread adoption of NAPAS based cards by commercial banks and finance companies (FinCos), a trend that is expected to continue with the support of government initiatives and ongoing improvements in infrastructure and card acceptance networks.

Banks dominates the market share in terms of both card volume and transaction value, while FinCos started to penetrate the landscape recently with modest contributions due to their limited-service offerings and weak ecosystem compared to commercial banks. However, FinCos still have room to boost its credit card segment thanks to consistent consumer credit demand from the mass and middle-income segments.

The credit card market in Vietnam embraces huge growth potential backed by its low penetration compared to regional countries, robust growth of e-commerce and online services, and the acceleration of digital payments. Payment via QR code, POS, and e-commerce sites witnessed outstanding growth, reflecting the shift in consumer behavior toward contactless payment, indicating a promising prospect for credit card development.

However, credit card development will evolve with new capabilities, and market players must stay up to date on trends to provide the best customer experience possible. Emerging trends like QR codes, E-Wallets, pose challenges, forcing credit card players to adapt to innovative features to stay competitive in the payment market. Therefore, issuers are motivated to bring into play new solutions to fulfill consumer preferences for convenient payments, starting with the introduction of virtual and contactless cards.

Market players are expected to enhance their ecosystems by integrating into digital platforms, collaborating with consumer brands and fintech firms, and introducing innovative card products and incentives. As a result, co-branded and hybrid credit-debit cards are anticipated to trend in the coming years.

2. Key figures covered in the report:

• Market structure and growth of financial cards in Vietnam by active card volume and transaction value, breakdown by types of cards (debit, credit and prepaid cards) , by international cards vs domestic cards and by card network providers (VISA, MasterCard, JCB, American Express, NAPAS and UnionPay)
• Zoom in market size, growth, and segmentation of the credit card market during 2018-1H2023 by the number of active credit cards in circulation and by transaction value, with breakdowns by
  • Product type: International vs Domestic credit cards
  • Card issuers: Banks vs FinCos
  • Card usage purpose: Credit purchase vs Cash withdrawal
• Updates on credit card payment infrastructure by:
  • Number of card acceptance points nationwide – total number and breakdown by type of card payment solutions: POS, mPOS, QR Code, Ecom, ATM
  • Payment value via card acceptance points nationwide and the growth of each type of acceptance point
  • Average monthly transaction value per card during 2018-1H2023
  • Key development trends and growth drivers for the credit card market
  • Market size and market share by active card volume and transaction value, including credit card purchase and cash advance of major card issuers, including bank issuers and non-bank issuers (finance companies/FinCos)
  • Major regulatory updates affecting the business operations of card issuers
  • Outlook of the credit card market

3. This report answers the following questions:

• What is the market size, growth pattern and share of credit cards compared to other circulating payment methods in Vietnam?
• How is credit card usage tendency towards credit purchase vs cash advance and through different types of acceptance points i.e. QR code, POS &mPOS, Ecom, etc.,
• What is the pace of development for card payment infrastructure, and how do card payments compare to cash spending among Vietnamese consumers?
• What are the drivers poised to propel the growth of the credit card market in the upcoming years?
• Which key development trends are expected to shape credit card market changes?
• How is the competitive landscape among key credit card issuers
• With an in-depth view, which factors influence Bank’s credit card and FinCo’s credit card market?
• How does the Vietnamese government regulate and facilitate the expansion of cashless payments, specifically card transactions, through legal frameworks?