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High interest rates, annual fees and safety considerations have prevented the credit card industry from getting off to a roaring start in Vietnam.
Although both domestic and foreign banks have launched several promotion programmes, they still have failed to attract enough customers to use credit cards for their shopping and other needs.
Because they expect the market to be a lucrative one in the future, the banks are pushing the use of cards so as to acquire and expand their market share.
The promotion campaigns have included direct marketing and the granting of credit cards without any fees.
Ho Anh Ngoc, head of retail banking in the southern region for Techcombank, said his bank plans to increase the number of its credit card users to 23,000 by the end of this year. It is targeting customers from all income segments.
Other banks such as Vietcombank, Eximbank, Asia Commercial Bank have launched their own promotions to expand the use of credit cards.
Customers travelling to Singapore between August 27 and September 30, can get a set of X-mini Capsule speakers from Eximbank if they spend at least $500 using their Visa card over three days.
Phi Thi Phuong, head of Eximbank's card management department said since early this year, Eximbank has issued 4,000 credit cards, increasing the total number of customers to 30,000.
To attract more customers, international banks like HSBC and ANZ have sought to increase their market share by marketing on websites and through emails and phone calls to customers.
The banks have also linked up with trade centres and supermarkets to offer discounts for those using Visa or MasterCard for their shopping.
Hoang Long, who works for a transportation company in District 3, said he received an invitation to open a credit card from ANZ, but failed to get one because his monthly salary was less than VND5 million (US$256).
Furthermore, late payments on a Visa card attract very high interest rates of between 1.5 percent to 1.9 percent per month, and this is something that gives pause for thought to Vietnamese clients.
HSBC and Techcombank levy overdue fees of 1.87 percent and 1.6 percent per month respectively.
Card owners also have to pay other kinds of fees.
Nguyen Tu Anh, director of Smartlink Card Joint Stock Co, said customers have to pay considerable attention to opening fees, annual costs, loan rates and exchange rates for international payments.
Hai Duyen, a regular customer of Techcombank, said credit cards were not all as safe as presumed. Recently, she had her pocket picked, and lost VND20 million ($1,025) through her visa card.
According to Duyen, credit cards do not require any password like the ATM card. Thieves can use a forged signature.
Moreover, Vietnamese customers are still not used to using cards for their shopping, and prefer to use cash instead.
Also, many shopping centres are yet to install POS machines to accept credit card payments.
