TOKYO -- South Korean payment servicer Alliex has partnered with Vietnam's central bank to develop a cashless payment network accessible to banks and retailers, helping the country's broader effort to move away from a cash-based economy.
The system could become operational next year and will be expanded over five years with an investment of $700 million. In addition to the State Bank of Vietnam, Alliex will also work with major Vietnamese lenders VietinBank and SacomBank to promote cashless payments.
In Vietnam, cash payments accounted for 90% of transactions in 2016, according to local media reports. The government seeks to cut the ratio down to 10% by next year in a bid to improve both the transparency and efficiency of payments.
The core system will serve as a platform for electronic payments and bookkeeping. Tablets will be distributed to stores where the devices can be used to process QR payments and other cashless options.
Alliex, wholly owned by a parent based in Japan, envisions earning fees from each transaction.
South Korea boasts one of the most advanced cashless societies with penetration exceeding 90%. As a mid-tier player in the market, Alliex is behind the payment systems used by Lotte group stores and South Korean Starbucks outlets. Overall, its payment systems oversee over $700 million in transactions a year in South Korea.
Vietnam aims to leverage Alliex's know-how to quickly get its own cashless system off the ground. For its part, the South Korean company aims to cash in on the business opportunity created by a free trade agreement between Hanoi and Seoul.