By Phan Thao – Translated by Kim Khanh
Spending habits of college students
Under the impact of the Covid-19 epidemic, the interest in new payment technologies is growing in the Asia-Pacific region.
According to a survey conducted recently in 18 countries by MasterCard, 94% of respondents said they would consider using at least one new payment method such as QR codes, e-wallets and cryptocurrencies next year. Notably, up to 74% of respondents said they would shop regularly at small businesses if there were more payment options.
In 2020, 84% of consumers in Asia Pacific said they used more emerging forms of payment. Notably, up to 64% of respondents (75% of them belong to Generation Y – millennials) said they tried using new payment methods because of the pandemic impact.
Cashless payments are becoming more popular in Vietnam and other Asian countries.
Along with this is a change in consumption habits. Consumers are expecting to be served both directly and online. In fact, 60% of the respondents said they would avoid stores that do not accept any form of electronic payment.
In the future, the use of payment technologies will increase, while the use of cash will gradually decrease.
In fact, 69% of Asian consumers plan to use cash less next year. Meanwhile, e-wallets have become quite popular among consumers in this region. At least 68% of respondents plan to use this type of payment next year. This is higher than the global average (about 62%).
Payment methods have changed in 2021, according to a survey by MasterCard.
In Vietnam, according to the State Bank of Vietnam’s statistics, more than 255,000 transactions made via e-wallets were conducted in the third quarter of 2020, with a total value of over VND100 trillion. In general, e-wallet transactions in the third quarter of 2020 increased by 123.1% in the number of transactions and 141.5% in value over the same period in 2019.
This shows that like people in most other countries in the region, Vietnamese are gradually changing. Instead of using cash, Vietnamese consumers are using digital payment utilities.
Asians especially like QR codes and cryptocurrencies.
Among emerging payment methods, QR code payments are particularly popular in the Asia-Pacific region. This type of payment has a particularly great attraction in the Asia-Pacific region compared to the rest of the world.
Among those using QR codes for payment, 63% said in 2020 they used this method more often than in the past.
The rate was 64% in both Thailand and India, higher than the global average of 56%. The survey by MasterCard shows that convenience and hygiene were the main reasons for users to make touchless payments through their mobile devices.
In Vietnam, according to the State Bank of Vietnam’s statistics, although the QR code payment has been implemented for a short time, 30 banks and about 90,000 transaction points have accepted payment via QR Code.
Besides QR Code, cryptocurrencies are asserting their positions. In the Asia-Pacific region, 45% of the respondents said they might consider using cryptocurrencies next year. This figure is well above last year’s 12%, and 40% higher than the global average.
The popularity of cryptocurrencies in different countries. Data: Statista
Geographically, more consumers are more comfortable with using cryptocurrencies in Thailand (46%) and India (44%) compared to Australia (17%). However, with their volatile prices, cryptocurrencies are more of an investment item than a currency to spend.
In Vietnam, cryptocurrencies are considered an illegal means of payment. The issuance and use of cryptocurrencies as a means of payment will be handled according to the provisions of law.
However, many statistics show that Vietnam currently ranks second in the world for the popularity of cryptocurrencies. According to Statista’s survey, of every five Vietnamese, one said they used to use or own cryptocurrencies.
|Visa and Sacombank are supporting SMEs in rationalising operations|
Business cards help SMEs to save time in accounting processes and empower them to control their company expenditure. Visa is collaborating with clients and partners to extend the merchant network for business debit card, assisting Vietnamese SMEs to start and grow their business. Meanwhile, SMEs can “buy now and pay later” using business credit cards. By utilising Visa Business Reporting for business cards, SMEs can safeguard against misuse or poor management of employee expenses to achieve further growth.
“As the digital economy continues to grow rapidly, it is a key priority for businesses to have the ability to make faster and more efficient transactions, which can be achieved through digital payment methods. With Visa Business Reporting, we are providing a powerful expense management and reporting solution that has been designed specifically for small businesses to enable them to operate more effectively,” said Dang Tuyet Dung, Visa country manager for Vietnam and Laos.
Nguyen Tan Cuong, deputy chief corporate banking officer at Sacombank, agreed, saying: “Sacombank is excited about our partnership with Visa because it gives us the opportunity to offer this groundbreaking business management tool to customers and help them manage their finances more efficiently. We believe that by monitoring their cash flow, companies will be able to overcome their financial challenges during this uncertain time. With Visa Business Reporting, SMEs are equipped with the data-driven insights that enable them to better understand and improve their operations.”
As businesses in Vietnam continue to grow at unprecedented rates, recognition of the need to streamline operations to save costs and facilitate expansion is vital. Digitalisation can quickly itemise and categorise expenses to help SME owners easily identify inefficient/costly parts of operations. Visa Business Reporting can improve cash flow management, while providing financial incentives, thus enabling business payment cards to act as a highly efficient tool in terms of planning.
Visa Business Reporting can be accessed via desktop or mobile with near real-time updates of all business-card transactions. Cash transactions can also be added. Expense categories and dashboard can be tailored by each business to provide information that matters to them through daily, weekly, or monthly reports that analyse spending patterns from various perspectives following pre-defined expense categories.
“Visa’s goal is to empower SME owners and entrepreneurs with knowledge, skills, and access to networks and financial services that improve their economic livelihoods. We are committed to supporting the local economy and helping SMEs benefit from a variety of initiatives, including our Practical Business Skills programme which provides free online education to help them get their online business up and running, and the Visa Commercial Offers programme to enhance the efficiency of business processes for SMEs’ sustainable growth,” added Dung.
By Phuc Le
With more than 37 years experience in the fashion industry and 15 years in Việt Nam, Henri Hubert, creative director of Le Nom Group, a visual communication agency, believes sustainability should be the top priority for the industry. He speaks to Bồ Xuân Hiệp about sustainable fashion trends emerging amid the COVID-19 pandemic.
Inner Sanctum: What do you think about the impact of the pandemic on the fashion industry, especially towards sustainability in terms of design, manufacturing, and use of eco-friendly materials?
The pandemic has created a dramatic contraction in demand and production in the fashion industry, one of the sectors hardest hit by the crisis. The resulting economic shutdowns have created unprecedented challenges for the industry, including a decline in consumer spending and disrupted supply chains.
This could help accelerate a shift to greener, more sustainable supply chains, which will not only be critical for companies but will also impact the future of the fashion industry as a whole.
Sustainability has been identified as one of the top priorities for the fashion industry. Improving raw material sourcing with better recycling processes, reducing water consumption, and replacing hazardous chemicals with safer alternatives are some of the measures that can reduce fashion’s environmental footprint and help the industry survive in the new business scenario.
I think fashion houses have been forced to reinvent themselves. Those who were able to do so transformed their production lines. For example, they made masks and gowns for hospital staff and doctors. They also redesigned their collection to be more current, with styles more adapted to the psychological aspect of the moment. The materials were also seen, reviewed and corrected.
Inner Sanctum: Environmental concerns are increasingly important among consumers who are calling for environmentally friendly practices in the fashion industry. What are the sustainability trends in the industry?
The unprecedented crisis that the fashion and luxury industry has been going through since the beginning of the pandemic is forcing it to rethink its operations from top to bottom.
This economic shock must also be an opportunity to take action to reduce the negative social and environmental impact of the sector as the United Nations says in a call for a more responsible recovery.
The question now is ‘How can we build back better?’ The environmental facts are clear. The fashion industry alone is responsible for 8 to 10 per cent of global carbon dioxide emissions, which is more than international flights and shipping combined. These emissions are mainly related to the production of raw materials, textile manufacturing and the transportation of finished products.
The water footprint is equally catastrophic. Another recent United Nations report estimates that about 93 billion cubic metres of water — enough to meet the needs of five million people — are used each year by the fashion industry. It takes 7,000 litres of water to make a single pair of jeans, the equivalent of the water drunk by a human for seven years.
The biggest environmental impact of fashion is related to the washing of clothes, not only because of the water and energy used but also because of the water and soil pollution it causes.
According to the United Nations Conference on Trade and Development, 500,000 tonnes of plastic microfibres, the equivalent of 3 million barrels of oil, are dumped into the oceans each year. In addition, textile dyeing is the second largest contributor to water pollution in the world.
These are scary figures. Sustainability will be an important issue for consumers as far as brands are concerned, and current and future consumers. And I’m not talking about greenwashing but ‘real sustainability’.
The best thing is that we understand that our individual actions have societal consequences. Sustainability matters and will matter more and more.
I see a growing concern for employees of fashion companies as well. The same people who are consumers on the one hand are employees on the other. When executives, managers and employees support sustainability, it can have a positive self-reinforcing impact on the corporate culture.
Any fashion company is only as good as the talent it can attract, and the fashion talent of the future will want to work for fashion companies that make sustainability the keyword. So let’s keep hoping.
Inner Sanctum: We are living in a ‘throwaway’ culture and fashion waste has been increasing. What do you think about buying secondhand clothing as an option to reduce environmental impact?
Oh my, I love your question, you fall right in my passion! Buying secondhand clothing is a habit that has become more common, which is good.
In recent years, mentalities have evolved enormously to the point that in 2020 72 per cent in the world had bought or were considering buying secondhand, while a few years ago it was 50 per cent.
I lived in this context in France, where it was already very fashionable to dress vintage. For many reasons, personally, for me, it was the taste of ‘the well-done, the well-finished, the different.’ I loved the details of the clothes of my father. All of this came from a certain education in fashion.
Today in Việt Nam in my entourage I see a certain craze. Purchasing secondhand has many advantages, and it can be of incredible help for the industry, and especially for us wellness lovers.
Let me explain. It allows us to save money. The first good reason to buy secondhand, and not the least, is that it saves money. It helps reduce the environmental impact of a garment. Buying secondhand can extend the life of a garment by several weeks, months or years — the longer the better, of course.
It also helps reduce textile waste. According to studies by an American giant of online resales, one out of two Americans throw the clothes they want to get rid of directly into the trash. The result is that 62 per cent of the 30 billion clothes produced each year end up in landfills.
You can also find unique pieces. When we buy secondhand, we are far from the mass offerings of fast-fashion, and it is so much better. It allows you to find unique pieces, which is even more true if you buy vintage.
The secondhand offering is now so vast that it is possible to find absolutely everything, including good basics: jeans, black cigarette pants, white blouses, black boots, and sometimes items that have never been worn.
Buying secondhand clothes is choosing another model than one of mass production. It is a mode of consumption that opposes fast-fashion.
Inner Sanctum: New fashion styles are available almost every day. What do you think about the concept of fast fashion which has revolutionised the industry over the past decade?
Fast fashion concerns fashion brands that renew their collections very regularly to produce at low cost and sell at low prices.
Fast fashion appeared in the early 1990s with the arrival of brands like Zara in fashion epicentres such as New York or London. But it was in the late 1990s and early 2000s that low-cost fashion reached its peak with the series of brands we know today, which have become veritable empires such as H&M, Topshop, Gap, and, of course, Zara.
The recipe of fast fashion is simple: very regular renewal of collections by seasons or even by months or weeks, low prices, and reduced stocks. The process must be fast: the brands propose new collections as soon as a new trend emerges from the catwalks, celebrities, or the street.
This definition hides an unglamorous reality: sweatshops, sanitary and ecological disasters, human dramas, discrimination, and so on. Yet its consequences seem far away. And as they say, out of sight, out of mind.
But fast fashion is here, implanted in our daily life, even in our underwear. And its consequences are also very present. At a time of awakening consciousness and the development of sustainable and eco-responsible fashion, fast fashion cannot remain opaque and closed in on itself.
In response, they try to make us forget what is hidden behind our labels, with discounts, sales and other advertising to push us to consume more and more, and faster.
But to understand is to be able to make a choice. And as consumers, we can choose to become full-fledged actors in the textile industry. After all, if we choose to consume ethical fashion, fast fashion will be nothing.
The price to pay with fast fashion is high. The real price is not visible when you buy it. However, its damage on the planet and on people is immeasurable. If you don’t pay, someone else will.
There is an environmental downside to fast fashion. The flip side of low prices is the pressure on resources. Fast fashion still favours non-renewable, petro-sourced materials like polyester, elastane, nylon or even acrylic. Crops and transformation processes such as dyeing also require a significant amount of chemicals.
Unfortunately, most people are far from all of this, and think “cheaper, faster, new styles are all good for us”. VNS
Contactless payments were up by 230 per cent year-on-year in the first quarter, according to a study by Visa.
‘Consumer Payment Attitudes’ studied how behaviours have changed during the COVID-19 pandemic towards a cashless economy, and found eCommerce growth was up 5.5 times from the last quarter of 2020 to the first quarter of 2021.
Cashless payments growth was led by digital wallets, contactless payments and QR code payments.
Contactless cards led the way in the food and dining category, with 67 per cent of consumers using them in 2020 for bill payments (71 per cent), retail shopping (58 percent) and supermarket shopping (57 per cent).
Vietnamese consumers have quickly adopted new ways of paying that do not involve physical contact such as tapping to pay.
Dang Tuyet Dung, Visa’s country manager for Viet Nam and Laos, said: “Since the outbreak of COVID-19 we have observed that … people desire safer, more convenient shopping experiences. That is why we are seeing more first-timers adopting contactless payments and more companies shifting to digital, and this trend is likely to continue.”
Driving this transition from cash to alternative payments are security and convenience, with 58 per cent of respondents saying the safety of digital compared to cash is the main reason, and more than half (56 per cent) citing less hassle. Before the pandemic, Vietnamese were spending 3.1 hours per day online, but during social distancing that number increased to 4.2 hours at its peak.
Statistics from Visa’s study showed that 85 percent of consumers used eCommerce applications on their smartphones to pay for goods and services at least once a week, and 44 percent started shopping through social media channels for the first time since the start of the pandemic. — VNS
Thai conglomerate SCG reported revenues of VND8.2 trillion (US$356 million) for the first quarter, a 34 per cent year-on-year increase.
The results were driven by higher sales by its chemicals business, the company said.
It was also driven by seasonal improvements in its cement-building materials business and higher contributions from its packaging business because of active downstream portfolio expansion and a diverse customer base.
SCG Packaging has been helping authorities in Hai Duong Province tackle COVID-19, donating 100 paper beds to field hospitals.
In other charity works, ‘SCG Sharing the Dream Scholarship,’ its 14-year-old flagship programme, has funded over 5,000 students nation-wide.
It provides financial aid to students and shares knowledge in communities about sustainability, ethics and leadership. — VNS