To differentiate itself from the unauthorized Cross-Border Electronic Payments (CBEP) activities reported recently, the State Bank licensed Payment Intermediary VIMO.vn has released a public statement to clarify its legal CBEP service in partnership with WeChat Pay and Alipay.
Stories of certain Chinese-owned shops in Vietnam using unauthorized Chinese-issued payment POS (point-of-sale) machines to accept Chinese card and QR-code payment from Chinese tourists traveling to Vietnam have been highlighted by Vietnamese media recently, raising concerns about unauthorized foreign currency payment and tax losses involving visiting Chinese tourists. Specifically, by mid-May in Ha Long city on the shores of famed Ha Long Bay, local authorities have discovered over 200,000 RMB paid through Chinese-issued POS payment machines without going through the local banking system or payment intermediaries in Vietnam.
Mister Do Cong Dien, VIMO CEO, stated: “Recently, 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. 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 only without flowing into Vietnam, and has resulted in unmanageable transactions as well as tax losses.”
VIMO is now the first and only licensed Payment Intermediary in partnership with both WeChat Pay and Alipay without equity capital involved. This has grown acceptance of legal Cross-Border Electronic Payments through e-wallets for Chinese and South Korean tourists when they travel to and make payments at local stores in Vietnam, for which VIMO has reported and submitted a dossier to the State Bank of Vietnam. Accordingly, 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 tourist’s account, then credit into VIMO e-wallet of the Vietnamese vendor in Vietnam Dong (VND), in accordance with applicable laws and regulations. When the reconciliation period comes around, the foreign e-wallet company will transfer the outstanding balance to VIMO’s bank in Vietnam, bringing about a significant source of foreign currency to the country.
By explaining and distinguishing obviously between the legal Cross-Border E-Payment method being provided by VIMO in combination with WeChat Pay, with the unauthorized ones performed by Chinese businessmen operating in the territory of Vietnam, VIMO has officially proposed the State Bank of Vietnam, the relevant competent authorities and local media to support and advocate VIMO to push back the urgent problem of unauthorized Cross-Border E-Payment, so as to create a shakeout in the market, promote non-cash payment and Vietnam tourism industry as a whole.
According to figures from the Vietnam National Administration of Tourism, tourists from China totaled nearly 1.8 million in the first four months of 2018 and South Korea nearly 1.2 million, increases of 39.7 percent and 67.3 percent year-on-year, and accounting for nearly 60 percent of all inbound tourists. Similar to other types of bank cards such as Visa, MasterCard or CUP, the acceptance of the popular e-payment methods in tourist’s home countries when they travel to Vietnam helps stimulate consumption of foreign tourists and turnover for Vietnamese enterprises, meanwhile bring about foreign currencies for the country and support the government to well-manage the spending flow of tourists and turnover of local businesses.
Emphasizing the need for Cross-Border E-Payment, Mister Dien highlighted that VIMO has been contributing 30-50 percent increase in turnover for Vietnamese businesses thanks to its convenient e-payment methods, which also stimulate consumption among foreign tourists as they no longer need to carry so much cash, but just the handy mobile phone. He also advised Chinese tourists visiting Vietnam to only pay at local stores accepting legal WeChat Pay and Alipay issued by VIMO to stay safe and avoid unnecessary trouble with local authorities similar to recent cases in Ha Long Bay.