Workforce Payments Guide Vietnam

Last updated: Jan 14, 2024

Currency
Vietnamese Dong (VND)
Payroll Frequency
Monthly
Capital
Hanoi
Fiscal Year
1 January - 31 December
Employer Taxes
21.50%
Employee Costs
10.50%
Central Bank
State Bank of Vietnam
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3rd Party Payments

Authority  Payment Frequency  Due Date  Payment Method 
 Tax Department (regional department)  Quarterly  By the last day of the first month of the quarter following the quarter in which the tax obligation arises  Partner bank account; or 

– Local account owned by client 

 

Enterprises (for Corporate Income Tax – CIT)  Quarterly and Annually  Quarterly provisional CIT payments are due no later than the 30th day of the next quarter. Final payment of CIT is due with the final CIT return (i.e., the last day of the third month as of the ending date of a calendar year or a financial year)  Partner bank account; or 

– Local account owned by client 

 

Social Insurance Department (regional department)  Monthly  Last working day of that month  Partner bank account; or 

– Local account owned by client 

 

Labour Union/ General Confederation of Labor (regional department)  Monthly  Last working day of that month  Partner bank account; or 

– Local account owned by client 

 

Payments Coverage

Papaya Global fully supports workforce payments in Vietnam.

Contractor Payments

Papaya Global supports payments to contractors in Vietnam. The payout currency may vary depending on the receiver bank account setup when receiving foreign currencies. It is advised for contractors to reach out to their bank to confirm how foreign currencies are handled.

Payroll Frequency

Monthly

IBAN

KYC

The Know Your Customer (KYC) process in Vietnam involves identifying and verifying the identity of clients when opening an account and periodically over time. This is done by checking the identification documents of applicants against public and sometimes government data sources.

For individual customers, the required identification information includes full name, date of birth, nationality, occupation, position, phone number, identity card or passport, and residential address. For organizations, it includes trading name, head office address, telephone number, fax number, operational sector, and information about persons establishing and/or representing the organization.

As of 4 December 2020, the Vietnamese government introduced a process for electronic KYC (eKYC) for Vietnamese citizens and enterprises applying for an individual account. The eKYC process typically involves verification of documents, extraction of customer information automatically by OCR technology, and comparing photos on identity documents with real faces through selfies or videos.

Banks must establish a process for collecting the same documents as required for regular KYC, perform an examination and investigation of the applicant’s documents, warn the applicant about the process of conducting KYC electronically and announce the results of the eKYC investigation to the applicant.

Banks are allowed to decide the method, form, and technology used for eKYC, as long as it meets minimal requirements and ensures the match between a client’s identity and biometric data. They must also formulate procedures for risk management, control, and assessment. Accounts opened using eKYC must be limited to a transaction amount of 100 million VND per client per month except for five specific cases.

In special cases, the bank may decide to apply a transaction limit of more than 100 million VND/month/customer, but must implement additional risk prevention measures. The eKYC process became operational from 5 March 2021.

Banking Regulations

ASEAN Cross-Border Payments: Vietnam’s central bank has agreed to participate in an ASEAN cross-border payments service system. This agreement aims to improve regional payment connectivity and facilitate the development of more transparent, affordable, trackable, and faster cross-border transactions.

Memorandum of Understanding (MoU) on Cross-Border Payments: Under the MoU, the State Bank of Vietnam (SBV) and their counterparts from Indonesia, Malaysia, Philippines, Singapore, and Thailand have committed to developing cross-border payment connectivity for retail transactions, including quick response (QR) codes, instant payments, and other emerging payment models.

Decree 101/2012/ND-CP: This decree provides guidelines and requirements for non-cash payments in Vietnam. It covers setting up and using accounts, non-cash payment services, payment intermediary services, and organizing and managing payment systems.

Decision No. 2545/QD-TTg: This decision sets out key objectives and solutions to promote non-cash payments. It targets the changing payment habits of Vietnamese citizens, creating risk management mechanisms, and improving the transparency of payment systems.

Circular 20/2022: Issued by the State Bank of Vietnam (SBV), this circular guides activities of one-way money transfer from Vietnam to abroad and payment, money transfer for other current transactions of institutional residents and individual residents.

Opening a bank account

To open a company bank account in Vietnam, the following requirements must be met:

Schedule an appointment with the chosen bank and visit the bank with the required documentation.

The necessary documents include:

  • Company registration documents: A copy of the business registration certificate, tax identification number, and business license.
  • Personal identification: A passport or ID card for each authorized signatory and a copy of their residential proof.
  • Company’s profile: Information about the company’s background, including its business activities, type of company, ownership structure, and number of employees.
  • Company’s financial information: A balance sheet, profit and loss statement, and other relevant financial documents to demonstrate the financial stability of the company.
  • Bank reference letter: A letter from a current bank that verifies the company’s financial status and reputation.
  • Power of attorney: A notarized power of attorney for the authorized signatories.
  • Proof of physical address: A utility bill or a lease agreement to prove the company’s physical address.
  1. Fill out the account opening application form provided by the institution with accurate details.
  2. Submit the application along with the required paperwork to the bank authorities and pay any necessary fees for opening the account.
  3. Undergo due diligence and compliance checks by the bank to confirm the legitimacy of the supplied papers and guarantee compliance with rules.
  4. If the bank has a requirement for maintaining a minimum balance in the account, deposit the account opening fees.

Once the application form has been approved, the account will be opened and account details will be received.

The process of opening a business bank account in Vietnam can take anywhere from a few days to a couple of weeks. However, in some cases, the process may take longer, depending on the complexity of the business and the specific requirements of the bank.

International Banks

Major foreign banks that operate in Vietnam:

  • Hongkong – Shanghai Bank Vietnam Limited (HSBC)
  • Australia and New Zealand Banking Group Limited (ANZ Bank)
  • Standard Chartered
  • Citibank Vietnam
  • Shinhan Vietnam
  • United Overseas Bank Limited (UOB)
  • Siam Commercial Bank
  • Bangkok Bank
  • BNP Paribas
  • Hong Leong Bank
  • CIMB Bank
  • Mizuho Bank

Major Local Banks

Major local banks in Vietnam:

  • Vietnam Bank for Agriculture and Rural Development (Agribank)
  • Bank for Investment and Development of Vietnam (BIDV)
  • Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank)
  • Vietnam Bank for Industry and Trade (Vietinbank)
  • Asia Commercial Bank (ACB)
  • Tien Phong Commercial Joint Stock Bank (TP Bank)
  • Maritime Commercial Joint Stock Bank (Maritime Bank)
  • Sai Gon Thuong Tin Commercial Joint-stock Bank (Sacombank)
  • Vietnam Prosperity Joint Stock Commercial Bank (VPBank)
  • Viet Nam Technological and Commercial Joint Stock Bank (Techcombank)
  • Military Commercial Joint Stock Bank (MB Bank)
  • Vietnam International Commercial Joint Stock Bank (VIB)

Payment Tools

The B2C payment tools available in Vietnam include:

1. Cash

2. Cards including NAPAS, Visa, Mastercard

3. E-wallets/digital wallets like MoMo, ZaloPay, Viettel Pay, AirPay (now ShopeePay), Grab (with Moca Wallet)

4. Bank transfers such as Vietcombank, VietinBank, BIDV, VIB, ACB, MB, and TPBank through NAPAS

5. Buy Now, Pay Later (BNPL) services with providers including Atome, AfterPay, Fundiin, Grab, Litnow, and Kredivo

6. Prepay payments

7. Over the Counter (OTC) Payment

8. Mobile payments (direct carrier billing)

9. Prepaid or debit cards

10. Cash on Delivery (COD) payments

11. Specific online payment platforms such as Vitapay, 2C2P, SenPay, 123 Pay, Skrill, OnePay, AsiaPay, PayPal, VNPay, VTC Pay, Ngan Luong, Bao Kim, Payoo, SmartLink, and inai.

Cryptocurrency

In Vietnam, it is not possible to pay employees with cryptocurrencies. The country’s legal framework and the State Bank of Vietnam do not recognize cryptocurrencies as a legitimate form of payment or currency. The issuance, provision, and use of cryptocurrencies as a means of payment are prohibited, and the law also mandates that all financial transactions and payments within the country be conducted exclusively through the Vietnamese Dong.

The State Bank of Vietnam has even issued a prohibition on the provision of services related to cryptocurrencies by financial institutions. Despite these prohibitions, possession of cryptocurrencies is not evidently illegal, but their use as a means of payment within Vietnam is strictly prohibited, and punishable by a fine. The government has not issued any licenses for cryptocurrency businesses, and running such a business without a license can lead to administrative penalties.

Currently, Vietnam’s Ministry of Finance is developing a legal framework on cryptocurrency and virtual assets, but no specific timeframe or regulations have been released yet.

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