MobiFone, VTC eye scratch card payments for services

Representatives of MobiFone and Vietnam Multimedia Corporation (VTC) have proposed the Ministry of Information and Communications (MIC) to consider scratch card payment for digital content services.

Illustrative photo
Illustrative photo

The proposal comes after the businesses of both operators and multimedia companies have taken a hit.

At a regular meeting with MIC on June 5, VTC chairman Luu Vu Hai said the halt of scratch card payment for digital content services had greatly affected its business. Its five-month revenue and profit were only 38 percent and 33 percent of the yearly targets, respectively, partly due to restricted payment methods, he said.

According to Hai, VTC is trying to overcome difficulties in payment services on its own, but without policy support from the management authority and the approval of scratch card payment, the digital content industry will still be in the back foot.

Tran Manh Hung, chairman of the Vietnam Posts and Telecommunications Group (VNPT), which manages mobile phone operators VinaPhone and MobiFone, said due to the ceasing of scratch card payment for non-telecommunication services, VNPT’s May revenue had dropped by 4 percent against the same period last year while the five-month revenue this year fell by 10 percent.

MobiFone’s general director Cao Duy Hai suggested that the management authority allow the use of scratch card to pay for digital content services as well as work out measures to solve the difficulties faced by businesses in providing services.

In April, major mobile phone operators, including VinaPhone, MobiFone and Viettel, announced a temporary halt of scratch card payment for digital content services.

The move came after the security authority busted an online gambling ring worth nearly VND9.6 trillion ($422 million ), of which some VND9.3 trillion were made through pre-paid telecom cards and game cards.

Pham Hong Hai, Deputy Minister of Information and Communications, said in principle, the ministry had no problem allowing the use of scratch cards for telecommunication and non-telecommunication services. However, after the online gambling incident, the issue was subject to reconsideration, he said, adding that the use of scratch cards for non-telecommunication services was under the management of payment services of State Bank of Vietnam.

He affirmed that the ministry did not prohibit the use of scratch cards for payment, but without clear legal regulations for payment related to services outside its scope of jurisdiction, network operators must consider scratch card payment in accordance with the existing law.

Nguyen Duc Trung, head of MIC’s Department of Telecommunications, said SBV’s divisions had recently coordinated with his department and other management authorities to come up with the best solutions involving the use of scratch card payment for non-telecommunications services.

Network operators and digital content companies are asked to jointly study and propose solutions based on the management experiences of other countries, Trung said.

In May, many online gaming businesses complained that by stopping scratch card payment, their revenues had dropped between 50 and 65 percent, while small businesses lost up to 90 percent of their revenue as they did not have enough resources to develop a separate payment channel.

The three largest operators –VinaPhone, MobiFone and Viettel – also said their sales of scratch cards plummeted by 80 percent after the halt.