Promoting financial inclusion in Vietnam: the role of mobile phones

Abstract

Financial inclusion refers to the provision of formal financial services (payments, money transfers, savings, credit, insurance) in a convenient manner, in accordance with needs and expenses, and
for acceptable prices. Vietnam currently has more than 60 million smart mobile phone users (Statista, 2022a), hence, the study hypothesizes that mobile phones can increase access to and utilization of financial services. The study assessed the effect of mobile phones on Vietnam’s financial inclusion in terms of account ownership, formal borrowing and savings, and non-cash transactions using binary probit model and data from over 5000 Vietnameses individuals compiled by the General Statistics Office (2019). The results indicate that mobile phone owners are more likely to have bank accounts, formal and informal savings, and electronic payments. In contrast, the use of mobile phones had little influence on formal and informal borrowings.