Based upon the use of e-wallets and digital payments systems in China, many Chinese tourists have asked Vietnamese retailers whether they have Point Of Sales (POS) systems that support Chinese e-wallet systems and QR codes.
Vietnamese media have highlighted various Chinese-owned shops in Vietnam that are using unauthorized POS machines. Many of these machines have been issued to companies in mainland China to use with domestic customers. The machines are then brought to Vietnam illegally in order to accept Chinese e-wallets and QR code payment systems from Chinese tourists travelling to Vietnam.
The Chinese government says that it doesn’t condone the use of digital payment systems in any unauthorized setting and the Vietnamese government has raised concerns about unauthorized foreign currency payment and the potential loss of tax revenues from Chinese tourists.
Earlier this month, Ha Long city authorities examining the records of one retailer found more than $30,000 USD (200,000 RMB) had been paid through a Chinese-issued POS system that was not linked into the Vietnamese governments database or had links with any Vietnamese banks or payment intermediaries.
One solution to the payments issue is Vimo.vn, an e-wallet application that is co-branded with Vietnam telecommunications giant, MobiFone. In a discussion about the problems with illegal Chinese digital payment systems, Do Cong Dien, the CEO of Vimo said, "There have been a number of Chinese-owned businesses using POS payment machines or e-wallets issued in China to receive RMB payment from Chinese tourists while trading in the territory of Vietnam. This is a serious breach of Vietnam Laws.”
Dien noted that, “Due to prices listed and payment accepted in foreign currency in the territory of Vietnam, it has caused direct money flows from buyers' bank cards or e-wallets to that of the sellers in the China territory without flowing into Vietnam, and has resulted in unmanageable transactions as well as tax losses."
VIMO is the first and only licensed payment intermediary in partnership with both China’s Alipay and WeChat Pay. Vimo’s business goal is to facilitate legal cross-border electronic payments through e-wallets for Chinese and South Korean tourists when they travel Vietnam and make purchases and payments at local stores in Vietnam.
VIMO is working wit the State Bank of Vietnam to create a system that is in accordance with Vietnamese laws and regulations. With the Vimo system, when a tourist uses a foreign e-wallet application to pay at local Vietnamese stores, VIMO requests the foreign e-wallet company to deduct the payment amount from the tourist's account and then credit that amount as Vietnamese Dong in the VIMO e-wallet of the vendor.
When the Vimo and bank reconciliation period is complete, the foreign e-wallet company will transfer all outstanding balances to VIMO's bank in Vietnam. The company believes will be a significant source of foreign currency to the country.
Vimo’s CEO, Dien said that Vietnam needs to have Cross-Border E-Payment systems in place to take advantage of foreign tourism. Dien said that Vimo has documented revenue increase of 30 ~ 50% with Vietnamese retailers due to its e-payment systems. One of the key advantages of e-payment systems is that they allow consumers to make spontaneous buying decisions since they don’t need to carry cash, but just their mobile phones and the company expects to see the expansion of legal e-payment systems throughout the country in the coming years.