Phan Thùy Linh Online Payment
Phan Thùy Linh Online Payment
Phan Thùy Linh Online Payment
ONLINE PAYMENT
Business environment and Management problems
I. Introduction
Online payment, also known as electronic payment, it refers to the money which exchanged
electronically. Broadly speaking, online payment refers to the transaction exchanged the
funds on internet, typically involves computer network, internet and digital stored value
system. It makes e-payment may at any time, via the internet directly to the transfer,
settlement, and forms of e-commerce environment. Online payment may seem to be very
easy and fast, but it consist of the confidential and security for the card info. In order to
make sure that the process is work correctly, the merchant must connect to the network
with the Issuing bank, processor, and others financial institution, so that the information
that provided by the customer can be routed reliable and secure. As highly sensitive
payment information, trust and confidence is an essential element of any payment
transactions. This means that payment processing services should be provided by a wealth
of experience in payment processing and security…
2. General environment:
Political factor
With the Communist Party of Vietnam as the only political party in the country, the
Vietnamese political system has high level of stability compared to other countries in the
region. This is the cutting edge of Vietnam to raise its competitiveness. In order to be
accepted into WTO, Vietnam is obliged to set up trade relations and trade agreements with
foreign countries. As a result, this has opened up new opportunities for foreign banks to
further implement as well as enhance the efficiency of e-banking services in Vietnam
Economic factor
Vietnam is a developing country with continuously rising GDP over the year. In the period
between 2000 and 2013, Vietnam has managed to secure an average GDP growth rate of
6.2 percent. Beside, according to CIA World Factbook, Vietnam has one of the lowest
unemployment rates in the world. With the estimated unemployment rate of 1.3% in the year 2013,
Vietnam ranks 7th worldwide. According to Figure, after reaching the high point of 2.9% in the first
quarter of 2010, Vietnam has managed to continuously cut down the unemployment rate over the
year to the current level of 1.3%. According to the above data, the use of electronic payment by
Vietnamese people has also increased significantly.
Social factor
E-payment is influenced by socio-cultural factors. The most common concern among
internet users is privacy. Privacy is described as an ethical right granted to individuals who
are protected from intrusion into their personal lives. Users of the internet have an online
identity that they use to make financial and personal transactions. Consumers are very
worried about their online identity being protected. Countries are creating ethical
legislation to promote proper internet use in line with this. Any business should be aware of
these laws and build marketing strategies after carefully considering them. E-payment has
been impacted by the growing use of mobile technology.
Technological factor
Internet penetration rate of Vietnam has been growing with a rapid pace. As of 2010, the
total number of Internet users in Vietnam has reached 26.8 million and a penetration rate
of 31% was achieved. During this ten-year period, the figures keep rising year over year
without any fluctuation (Cimigo Net Citizens 2011). , the growth rate of internet users in
Vietnam is extremely high compared to other regional neighbours. This is a golden
opportunity for internet-based services to penetrate the Vietnamese market. Banks and
financial institutions can expect to benefit from the growth of Internet penetration and
should take this chance to further improve the quality of e-banking services and expand
their markets.
Demographic factor
Together, strong economic growth and a young, tech-savvy population will drive demand
for fintech solutions. Vietnam has seen impressive annual GDP growth of 6 per cent in the
last five years and 7 per cent in 2019 alone. Meanwhile, GDP per capita is predicted to
increase from US$2,516 in 2018 to US$4,449 in 2025. This rapid rise in incomes is expected
to boost demand for consumer products and services. At the same time, Vietnam boasts
favourable demographics. Its large and growing population stood at 96.5 million people in
2019.10 Vietnam is also a young country, with 70 per cent of people aged between 15 and
6411 and a median age of 30.,4,12
Legal factor
This rise of the digital economy (coupled with regulatory reform) has accelerated the uptake
and use of electronic payments (or e-payment) in Vietnam. Over the past few years,
e-payment activities in Vietnam have been developing rapidly, especially after the issue of
Decree 101/2012/ND-CP in 2012 and, Circular 39/2014/TT-NHNN in 2014, which set out the
legal framework for such e-payment activities. As a result, there has been a sharp increase
in foreign investment in the e-payment sector in Vietnam. Foreign investors have invested
in more than one third of the licensed e-payment companies in the market (eg Momo, 1Pay,
Paypoo, Mobivi), and about half of these companies now have majority foreign ownership.
IV. Conclusion
The term "electronic payment" refers to a method of payment that does not include the use
of physical cash or checks. Theft of payment records, personal data, and malicious
consumer denial are also threats to online purchases. As a result, before electronic
signatures become widely used, we must rely on the technologies available at the time to
ensure an acceptable degree of network protection. If the customer needs to keep their
information private, they can use payment options like E-cash or NetBill Checks, which have
a higher degree of privacy. E-payment networks will favor both customers and service
providers, resulting in increased national competition in the long run. The performance of
electronic payment system applications is determined by how well the protection and
safety aspects, as viewed by both customers and sellers, are handled. This, in essence,
improves market trust in the system.
To do that, businesses must improve customer trust by using tools like Encryption, Digital
Signatures. Another key point to bear in mind is to check the issuing country and the billing
address. Make sure the issuing country and billing address country are the same. This is
especially important, because minor banks may not have rigorous identification procedures.
While consumers value their privacy and require quick web site ordering facilities, it is
important to gather sufficient customer identity details during the ordering process. The
customers’ name, credit card number and expiry date is not enough. Merchants should call
them for verification through phone or request a photo ID to be faxed if they have any
doubts.
V. Reference
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3. Dennis, Abrazhevich (2004). Electronic Payment Systems: A User Centred Perspective and
Interaction design. Eindhoven: Technical Universiteit Eindhoven. p.1to12
6. Noor, Aaihan Ab Hamid, Aw Yoke Kheng. A Risk Perception analysis on the Use of Electronic
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and 8.
9. Whiteley, David, (2007). e-Commerce, Strategy, Technologies and Applications. Tata McGraw-Hill
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%E1%BB%87n,micropayment%20(Maiyo%2C%202013).
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