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E-wallet market "explodes" & the race of "burning money" of e-wallet giants

The Vietnamese market is witnessing fierce competition from more than 40 e-wallets and is considered to be in a booming phase. In particular, in the context that Vietnam is in the race to become a cashless economy, the impacts of the 4.0 revolution, and the covid-19 pandemic have contributed to changing business habits and consumer payments of Vietnamese people.


Over the past four years (October 2018 to October 2022), the number of e-wallet users has grown impressively: from 12.3 to 41.3 million (up 330%). It is estimated that by July 2024, Vietnam's e-wallet market will have 50 million active users, 100 million users in May 2026, and 150 million users in July 2030. The volume of non-cash payment transactions in the first 11 months of 2022 also increased by 85.6% over the same period.


According to forecasts, with a compound growth rate of up to 30.2% per year in the period 2020-2027, the mobile payment market in Vietnam could reach $2.7 trillion by 2027. Besides the growth rate, the gap in the market is also a promising factor for businesses to enter the game.


According to Mastercard New Payments Index 2022 report, 94% of consumers in Vietnam used at least one digital payment method and 60% of them used an e-wallet with a smartphone operation. Consumers also plan to use digital wallets more in the future, with 77% saying they will use smartphone wallets more often next year.


The race of "burning money" of e-wallet giants

Besides the "big guys" such as MoMo, VNPAY, Moca, ShopeePay, ZaloPay, and Payoo, the e-wallet market is becoming more and more exciting with the entry of a series of "rookies" such as VinID, SenPay, MobiFone Pay, eM, SmartPay, G-Pay,... By the end of 2021, MoMo dominates when attracting 56% of the Vietnamese population to use it. Next is ShopeePay with 17%, ZaloPay with 14%, and ViettelPay with 8%, the rest are Moca and VNPT Pay with only 2% and 1% respectively.

VNPay

The game of "burn money" became more and more fierce when VNPay announced to receive an investment of US$250 million from General Atlantic, Dragoneer Investment Group, and Paypal Ventures, ... at the end of July 2021. This is not only a competition between e-wallets, but also a competition between e-wallets and similar services from banks and telecommunications companies.


With the strength of an electronic payment gateway platform and a "remarkable" network of payment affiliate partners, in early December 2022, VNPay announced a cooperation with the leading retailer in Vietnam, Saigon Co. op to expand the client file.


In recent years, the business situation of the enterprise is quite positive when recording a positive growth rate in both revenue and profit after tax. Specifically, this tycoon's revenue reached more than VND22 trillion by the end of 2021, up 4 times compared to 2017. After slowing down in 2019, VNPay's profit after tax started to grow again and reached nearly VND320 billion in 2021, an increase of 87% compared to 2020.


Momo

At the end of 2021, Vietnamese e-wallet Momo raised US$200 million in a Series E funding led by the Japanese bank Mizuho, becoming the latest unicorn in Vietnam along with VNG, VNLife, and Sky Mavis.


After becoming a "unicorn", Momo gradually transformed herself into a "shark" when deciding to establish MoMo Innovation Investment Fund and pour money into a series of startups. MoMo's first deal is to acquire all intellectual property rights of Pique startup, which was born in 2017. After the success of the acquisition of Pique, Momo continues to invest in the startup Nhanh.vn - Multi-channel sales management software with more than 80,000 shop owners is active.


Momo's revenue increased steadily in the period of 2019-2021. Accordingly, the revenue of this e-wallet in 2021 reached more than VND7.3 trillion (up 20% compared to 2020). However, so far Momo has not been profitable. By the end of 2021, the company's loss amounted to more than VND880 billion.


Foxpay

After more than 20 years of providing telecommunications infrastructure and online services, FPT Telecom officially developed a new business, which is providing intermediary payment services. With the desire to bring a smart, safe digital financial solution that best meets customer needs. This digital financial solution is called Foxpay.


In December 2020, the Foxpay system was granted the PCI DSS (Payment Card Industry Data Security Standard) level 1 by the PCI Security Standards Council. Foxpay is one of the few payment intermediaries to achieve this level of PCI DSS International Security.


The business results of the business are also quite impressive, bringing in thousands of billions of dong per year. In 2021, the revenue of this e-wallet reached nearly VND6.4 trillion, a slight increase of 4.3% compared to 2020. Along with that is the growth in profit after tax. Accordingly, in 2021, businesses bring in more than VND1.2 trillion, an increase of more than 60% compared to 2020.


ShopeePay

ShopeePay is renamed from Airpay, which is an electronic wallet in the Shopee-Now-Shopeepay ecosystem. Changing the name to ShopeePay helps increase brand recognition for the application thanks to the popularity of the Shopee e-commerce platform.


ShopeePay has been cooperating with many business partners to meet the diverse needs of users. Specifically, the ShopeePay wallet is integrated and widely used in shopping, payment, phone top-up on Shopee, money transfer, ordering food/drinks on ShopeeFood, and other services such as buying air tickets, passenger cars, and hotel reservations through ShopeePay's partners.


According to the report, in 2021 ShopeePay achieved a revenue of nearly VND5.4 trillion, an increase of nearly 20% compared to the same period in 2021. However, despite the huge revenue, ShopeePay still lost nearly VND385 billion, most of which was due to marketing expenses.


VNPT Pay

VNPT Pay is one of the typical products of VNPT-Media. From 2/3/2022 VNPT Pay application has been changed to VNPT Money. VNPT Money is a digital payment ecosystem via e-wallets, domestic cards, and international cards... to meet the needs of convenient, safe, and fast payment for most daily needs.


In the period 2017-2021, the company's revenue increased continuously from VND1.4 trillion (in 2017) to VND4.2 trillion (in 2021). 2021 is the first year that VNPT-Media reaches the revenue milestone of VND4 trillion. However, the profit after tax in 2021 has slowed down compared to 2020. Accordingly, the company's profit is only nearly VND380 billion, down 28% compared to 2020.

Payoo

Payoo is an electronic wallet owned by Viet Union. To date, Payoo has linked with nearly 25,000 points nationwide, paying nearly 1,000 different types of utility bills. With a large and regular user base, the total transaction value through Payoo reaches nearly VND100 trillion per year.


Once successful with bill payments, Payoo is back to conquering retail partners with new payment solutions. After retail, Payoo also encroached on many new areas. Up to now, Payoo has been serving most of the leading partners in many fields from technology, electronics, supermarkets, convenience stores, F&B, motorbikes, pharmacies, healthcare, beauty spa,…


After reaching the revenue milestone of more than VND3.2 trillion in 2019, the company's revenue began to show signs of decline. By 2021, Payoo's revenue only reached VND2.5 trillion, down 15% compared to the same period in 2020. However, the company's profit after tax still achieves a positive growth rate.


ViettelPay

ViettelPay was previously known as a mobile payment application in the form of a digital bank. At the time of its launch in 2018, ViettelPay created a new breeze for the digital finance field.


Facing the continuous development of advanced technology along with the increasingly diverse financial payment needs of consumers, Viettel decided to change ViettelPay to Viettel Money at the end of 2021.ViettelPay is not completely lost but converted into a digital payment feature right on the Viettel Money application.


By 2022, Viettel Money will become the 5th most popular electronic payment unit on social networks. Taking advantage of a telecommunications network and a system of transaction points covering 63 provinces and cities, Viettel Money aims to reach deeply into a group of customers who have never been exposed and are still afraid of electronic payment services.


Nganluong

Ngan Luong is an electronic wallet belonging to Ngan Luong Intermediate Payment Gateway Joint Stock Company, which was established in 2009. With huge capital from the world's leading financial groups such as IDG (USA), SoftBank (Japan), eBay (USA), Ngan Luong has the ability to secure finance for all online transactions in Vietnam. Ngan Luong has built an advanced system that links directly with nearly 40 financial and telecommunications institutions in Vietnam and internationally.


Ngan Luong's revenue in recent years has been quite volatile. Revenue in 2021 has increased compared to 2020 but is still lower than in 2017-2018. Specifically, in 2021, Ngan Luong's revenue reached about VND430 billion, an increase of 20% compared to 2020, and profit after tax also increased by 35% compared to 2020.

ZaloPay

ZaloPay e-wallet is developed by Zion, the competitive advantage of this e-wallet lies in the association with the Zalo application - the leading chat platform in Vietnam with more than 100 million users. ZaloPay e-wallet is currently a partner of famous brands such as Lazada, Beamin, Tiki, Sendo, Circle K, Big C, and Be in many different areas from e-commerce, and shopping to health and beauty.


Zalopay is also spending money strongly and suffers a large loss to attract consumers. In 2021, Zalo Pay brought in a revenue of only nearly VND270 billion but also recorded a net loss of up to VND1.2 trillion. Parent company VNG has spent a total accumulated provision expense as of September 2022 for this e-wallet of VND2.3 trillion.


Moca

In 2013, Moca was established by a group of former senior employees of Microsoft, Google, and leading experts in the financial and banking industry in Vietnam.


If Momo and ZaloPay are used the most to recharge phones, transfer money and pay periodic bills, Moca is mainly used for technology car payment and food delivery needs. Moca chose to cooperate with Grab to build a mobile payment ecosystem for the entire ecosystem of this super app. In addition, Moca also cooperates with Tiki to meet the increasing demand for shopping and electronic payment, especially in the current context.


Closing 2021 full of fluctuations, this brand's revenue reached about VND235 billion, down 13% compared to 2020. Like Zalopay, Moca has continuously "burned money" in recent years. Accordingly, Moca's profit after tax is continuously negative. By 2021, this business reported a loss of nearly VND165 billion.


In fact, the 4.0 technology revolution has changed the business and consumer payment habits of Vietnamese people. In addition, under the impact of the Covid-19 pandemic, electronic payment forms are increasingly promoted, the e-wallet playground is therefore also more and more exciting with the participation of a series of domestic and foreign names. The appearance of some "rookies" recently has made the race for market share hotter than ever.


Therefore, instead of attracting as many users as possible, the Vietnamese e-wallet market in the coming time will be competitive through the convenience and payment experience of users, and the advantage will belong to the e-wallet that retains many users. However, with people's psychology still afraid of the safety of online payment services, and the habit of using cash for a long time, besides increasing utility, e-wallets must pay special attention to ensuring safety and security for customers in order to develop quickly and sustainably.


Source: Vietdata's 2022 E-Wallet Market Report

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