Vietnamese fintech start-up MoMo, the key to winning the battle against Grab, Sea, and other rivals for the country’s 100 million consumers may be a simple cup of coffee. Before Vietnam’s latest COVID lockdown, the Ho Chi Minh City-based company ran promotions with some of the country’s biggest coffee chains, including Highlands Coffee, a fast-growing brand with more than 300 outlets. MoMo users got a discount for using the app to place and pay for an order that they then picked up at a scheduled time. The promotion was designed to give them a taste of the convenience of the all-in-one app. Nudging Vietnamese consumers to use MoMo for even small purchases is part of the company’s strategy to get the app “on the first page of their iPhone.
MoMo, short for Mobile Money, launched in 2013 and has become Vietnam’s biggest e-wallet. Being an early mover gave it time to cultivate relationships with tens of thousands of offline stores and connect them with the technology to transfer money between bank accounts. Today, it claims 60% of Vietnam’s mobile payments market, processing an annualized $14 billion worth of transactions for more than 25 million users, according to the company. The rise of MoMo, however, has drawn in overseas rivals, helping turn Vietnam into one of Asia’s most competitive fintech markets. Dozens of players, including Southeast Asian tech giants Sea and Grab, have entered the space, and are burning cash to acquire users. Analysts predict very few will survive the battle, not just against each other but also against similar services from banks and telecommunications firms. In addition to expanding its network of stores that accept the app, MoMo is racing to expand its suite of services, branching out into areas like motorcycle insurance and consumer loans. It has acquired a software company to speed up product development. More deals may be on the horizon if, like other fintech giants in Asia such as China’s Ant Group and India’s Paytm, it pushes to evolve from a payments business into a full-fledged digital bank.