HO CHI MINH CITY -- M_Service JSC, a fintech company based in Vietnam, has received a $28 million investment from investment banks Standard Chartered and Goldman Sachs to expand its electronic wallet service MoMo nationwide.
M_Service's MoMo e-wallet processes transactions for a customer base of around 2.5 million people, offering money transfer and payment features via smartphone apps and over-the-counter services.
Standard Chartered Private Equity, an arm of the global bank, has invested $25 million, while existing shareholder Goldman Sachs has put in $3 million, on top of an initial $5.75 million investment it made in 2013.
Proceeds of the new equity finance will be used to launch new products and services under the MoMo brand. This year M_Service, which was founded in 2007, plans to install MoMo point-of-sale terminals at retail outlets, including supermarkets and convenience stores, across Vietnam. It also aims to expand its customer base to 4 million.
Electronic money transaction services have become increasingly popular in Vietnam as more migrant workers in big cities are sending money home to rural areas using smartphones. As of December 2015, over half of the population were internet users, and there were more than 120 million mobile phone subscribers in the country last year. With only around 20% of the 93 million population having access to bank accounts, the government has been encouraging non-cash payment services to keep the economy turning.
MoMo, a shortened name of Mobile Money services, are leveraging on the growing availability of high-speed internet in the country, Pham Thanh Duc, chief executive officer of M_Service, said at a press conference on Thursday. "It's quite easy to send money to anyone in Vietnam, just by a text message," he explained.
Goldman Sachs invested in MoMo because of the potential of Vietnam's market, where many people have not been served by banks and the number of mobile phone users is increasing rapidly, according to Terence Ting, head of Asia private investment at Goldman Sachs Investment Partners.
Last year, Standard Chartered partnered with M_Service to enable corporate clients to make payments directly into their MoMo mobile wallets via its Straight2Bank platform, which has been launched in 10 emerging markets in Africa and Asia.