VietFinanceNews.com - The central bank has mapped out a plan to merge three local card networks to establish a unified card switching center.
Smartlink Card Services and Vina Brilliant Card (VNBC) companies will no longer provide card switching services, which will be transferred to Vietnam National Financial Switching Joint Stock Company, better know as BanknetVN, a source told the Daily.
The central bank has submitted the scheme to the Government, and it may be implemented within this year, said the source.
The source added the merger would help save costs and unify service management and development policies for the card market and non-cash payment services as a whole.
Card switching function facilitates the banks’ ATM and POS systems to connect and make payments with one another. In other words, this function helps ATM card holders of one bank to perform transactions at ATMs and POS of other banks and vice versa.
Local banks have linked their ATM systems with one another, but inter-bank ATM services only allow cash withdrawals and transfers, and holders cannot pay for goods and services at POS terminals of other banks than the issuing one.
The central bank said another issue was the strong surge in the number of ATMs in Vietnam, with 12,811 machines across the country reported by end-June last year, according to the Vietnam Bank Card Association. The country’s major financial centers have too many ATMs, yet the ratio of non-cash payment in the banks has recorded insignificant growth.
In fact, citizens withdrawing cash from ATMs is still cash payment by nature, whereas the banks find it harder to supply funds and ensure the security given the sharp increase in ATM-related crimes.
It is essential that the cards be wiped directly at POS terminals and the accounts paid with one another through intermediate tools such as mobile phones and the internet.
The merger of the three card switching systems will mark the connection of the country’s ATM and POS systems after more than ten years of development. The new switching center will facilitate residents and businesses in remote areas that are unfamiliar to electronic payment to pay for goods and services through different ways.
