Vietnam's Tech and Fintech Sectors Show Resilience Amid Funding Declines in 2024 | Vietcetera
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Jul 03, 2024

Vietnam's Tech and Fintech Sectors Show Resilience Amid Funding Declines in 2024

A brief funding report of Vietnam's tech and fintech sectors up until mid 2024.
Vietnam's Tech and Fintech Sectors Show Resilience Amid Funding Declines in 2024

Source: Unsplash.

In the first half of 2024, Vietnam's tech startups secured $5.2 million in seed funding, marking a 29% drop from the second half of 2023 and a 23.5% decline from the first half of 2023. Early-stage investments totaled $41.3 million, a decrease of 41% from H2 2023 and 53.4% from H1 2023. Notably, there was no late-stage funding in H1 2024, continuing the trend from H2 2023. Ho Chi Minh City led with $36.3 million, followed by Hanoi with $7.7 million. Key sectors included transportation and logistics tech, edtech, and retail.

Despite these declines, Vietnam's tech ecosystem remains resilient, with two mergers and acquisitions in H1 2024 compared to three in H1 2023. Prominent investors such as CyberAgent Capital and Insignia Ventures Partners played crucial roles. Vietnam, with its young population and high growth rate, is emerging as a prime location for fintech. Woori Financial Group's DINNOlab in Hanoi is fostering partnerships between Korean startups and Vietnamese fintech firms.

Vietnam's fintech sector is the second fastest-growing in ASEAN after Singapore, projected to reach $18 billion in 2024. The number of fintech companies has surged from 39 in 2015 to over 200 in 2022. JB Securities Vietnam's collaboration with Infina aims for mutual growth, while Konsentus and SAVIS are accelerating open banking with a focus on financial inclusion.

The payment sector, especially mobile wallets, is booming. Statista projects the number of mobile-wallet users to triple by 2026. The digital economy's expansion is driving fintech growth, particularly in digital payments and consumer lending. The central bank's MoU with ASEAN countries aims to enhance cross-border payments.

Hanoi's successful pilot programme for mobile payments in rural areas has been extended. The National Digital Transformation Programme targets a 25% GDP share by 2025. A new regulatory sandbox for fintech is in progress, with a draft decree launched in 2024.

Although fintech investments saw an 84% decline from $227 million in 2022 to $35.3 million in 2023, the outlook for 2024 is positive. Alternative lending experienced a 50% funding increase. A Mordor Intelligence report projects fintech transaction values to grow from $16.62 billion in 2024 to $41.76 billion by 2029, driven by digital banking and payments.