Vietnam’s digital economy to value US$220 billion by 2030
Vietnam’s digital economy to value US$220 billion by 2030
Digital financial services have seen healthy growth, especially in the adoption of e-wallets and account-to-account, fueled by both merchant adoption and consumer usage.
Vietnam’s digital economy is estimated to grow 11 times to reach US$220 billion in gross merchandise value (GMV) by 2030, the highest one among the Southeast Asian (SEA) countries.
Source: Google, Temasek and Bain & Company |
This year, SEA internet economies including Vietnam are forecast to enjoy double-digit growth, according to the latest e-Conomy SEA Report-Roaring 20’s: The SEA Digital Decade released by Google, Temasek and Bain & Company.
The size of Vietnam’s digital economy would be $21 billion in GMV, a 31% year-on-year increase underpinned by a 53% growth in e-commerce, despite the shrinking online travel market due to ongoing travel restrictions.
Looking at 2025, the country’s internet economy will likely reach $57 billion in value, growing at 29% compound annual growth rate (CAGR).
From the start of the pandemic to the first half of 2021, the country has seen eight million new digital consumers with more than half of them coming from non-metro areas. Stickiness of adoption remains high as digital consumption has become a way of life. About 97% of the new consumers are still using the services and 99% intend to continue going forward.
Pre-pandemic users, those who used the services before the pandemic, have consumed an average of four more services since the pandemic, and amongst all users, satisfaction with the services sit at 83% across verticals.
In Vietnam, digital financial services are also becoming critical enablers, with 99% of digital merchants now accepting digital payments and 72% having adopted digital lending solutions. Many of them are also embracing digital tools to engage with their customers, with 72% expecting to increase usage of digital marketing tools in the next five years, according to the report.
Some 30% of surveyed digital merchants in Vietnam believe that they would not have survived the pandemic if not for digital platforms. While digital merchants use an average of two digital platforms, profitability remains a top concern.
Source: Google, Temasek and Bain & Company |
The report highlighted digital consumption is now ingrained as a way of life in SEA. Early adopters have deepened usage-pre-pandemic users are consuming four more digital services than they did before 2020-and the 60 million consumers who joined since the pandemic started are here to stay, with nine in 10 consumers who tried a new digital service in 2020 continuing to use the service in 2021.
While SEA’s internet economy was resilient in 2020, a resurgence in 2021 has propelled the region upwards to $170 billion GMV. E-commerce, food delivery and digital financial services remain primary growth drivers and the internet economy is expected to reach nearly $360 billion by 2025.
Continued shifts in consumer and merchant behaviour, matched with strong investor confidence, have ushered SEA into its ‘Digital Decade’ - and the region is on its way towards $1 trillion GMV by 2030.
Florian Hoppe, Paner and Head of Digital Practice in Asia-Pacic, Bain & Company said: “The region has generated tremendous investor interest over the past two years, and we believe the ‘roaring 20s’ will really put Southeast Asia’s internet economy on the global map, as it chas a unique growth path and reshapes all industry sectors in the region. Managing this growth sustainably in the interest of all stakeholders will be a key mission for all ecosystem paicipants."
