Hanoi (VNA) - The State Bank of Vietnam is completing a mobile moneypilot project and will submit it to the Government for approval this month,Governor Le Minh Hung has said.

The pilot project will allow mobile subscribers to use their telecommunicationaccounts to pay for goods and services up to a limited value.

Telecommunications providers like VNPT, Viettel and MobiFone will join in thepayment market.

Mobile money, which can easily reach people living in remote areas withoutbanks as most people now own smartphones, is expected to help move Vietnam fromcash to cashless payments.

At the same time, banks will not have to spend money to expand their networks,according to the central bank.

To promote the development of mobile money, it is necessary to develop a goodsecurity mechanism, the central bank said. In addition, it also requires cooperation from telecommunications providers and efforts to upgradetechnology infrastructure.

Prime Minister Nguyen Xuan Phuc approved the use of mobile phone accounts topay for goods and services in January 2019.

The Government has been pushing mobile money as a solution to fight theCOVID-19 pandemic.

According to the Global System for Mobile Communications Association (GSMA), amobile money service includes transferring money and making and receivingpayments using a mobile phone.

The GSMA’s report released in March highlighted that mobile money accounts nowexceed one billion worldwide. The industry processed 2 billion USD intransactions per day in 2019.

The association’s statistics also revealed that the reach of mobile moneyagents was now seven times that of ATMs and 20 times that of bank branches.

According to a report of the BIDV Training and Research Institute, mobile moneyhas huge potential for development in Vietnam.

The report pointed out that at the end of 2019, Vietnam had 129.5 millionmobile subscribers, of which nearly half were 3G and 4G. Vietnam also had 43.7million smartphone users, or 45 percent of the country’s population in 2019, togetherwith 68.5 million internet users.

In addition, the central bank’s statistics showed about 63 percent of peoplefrom the age of 15 or higher were unbanked and could be target customers ofmobile money.

The report also pointed out that Vietnam needed to improve the legal frameworkfor mobile money./.