Hanoi, August 23, 2024, The Europe Today: The State Bank of Vietnam (SBV) and the Bank of Laos are set to explore the establishment of a joint cross-border retail payment system, aiming to enhance economic cooperation and mitigate external risks. This initiative was highlighted during a recent conference where both nations shared their experiences in promoting the use of their domestic currencies in bilateral trade and investment activities.
Currently, Vietnam stands as the third-largest trade partner of Laos, underpinned by a long-standing partnership in trade and investment. This strong foundation provides a crucial basis for the two countries to advance the use of their respective domestic currencies in cross-border transactions.
The proposed payment system, which will be jointly managed by the Vietnam National Payment Corporation (NAPAS) and the Lao National Payment Network Co. Ltd. (LAPNET), is seen as a significant step toward deepening financial integration between the two economies.
During the conference, officials introduced the Vietnam-Laos cross-border retail payment connection project, which will utilize QR codes as a key feature. The project is currently in the preparation stage, with the first phase slated for launch in September.
A total of nine Vietnamese banks and 13 Lao banks are participating in this pioneering project, which is expected to facilitate smoother and more secure transactions between the two countries.
This move aligns with a broader trend across the ASEAN region, where countries like Laos have increasingly adopted the use of domestic currencies in trade and investment to shield themselves from the uncertainties posed by political, geopolitical, economic, and financial changes.
The collaboration between Vietnam and Laos in establishing this payment system is a testament to the growing economic ties between the two nations and their shared commitment to financial stability and innovation in the region.
