Rationale-
In today's digital age, electronic payments have become a prevalent payment method in developed nations, facilitated by seamless bank transfers and credit card transactions Conversely, in developing countries like Vietnam, electronic payment services are just beginning to emerge and evolve through their initial development stages.
The rapid growth of electronic payment services in enterprises has led to significant advancements in the sector Key players like Paynet and Vnpay are at the forefront, while banks such as Vietcombank, Vietinbank, and Techcombank are increasingly focusing on enhancing their online banking offerings Additionally, payment services are continuously evolving, with notable improvements from organizations like the National Payment Services Joint Stock Company (NAPAS) and Banknetvn.
NAPAs operates a comprehensive interconnect network featuring 16,800 ATMs and 220,000 POS machines, facilitating payment services for over 90 million cards issued by 43 commercial banks both domestically and internationally in Vietnam.
200 firms in the airline sector, telecommunications, hotels, tourism and electronic payment services for other utilities customer
NAPAS has achieved notable success; however, it faces intense competition and limitations in its payment service quality, particularly in areas like risk warning and management systems Additionally, the company has not established friendly connections with many popular e-commerce platforms To enhance its market share, NAPAS JSC must evaluate how the quality of its payment service system impacts its expansion efforts A model for assessing the quality of the electronic payment service system has been developed and implemented to identify the strengths and weaknesses of the company's service quality, ultimately leading to solutions for increasing market share in the future.
This thesis explores "The Impact of Payment Service Quality on Market Share Expansion of NAPAS," addressing a significant gap in existing literature, as there are no prior evaluations of payment service quality's effectiveness on NAPAS's market share in Vietnam As one of the first studies in this area, it aims to assess the quality of NAPAS's payment services and contribute valuable insights for their improvement and development.
Literature review
In my thesis research, I analyze relevant literature, which is categorized into three main groups: first, studies examining payment services and their quality in online businesses; second, case studies evaluating payment service quality both in Vietnam and internationally; and third, experimental research exploring the connection between service quality and market share.
In his 2010 thesis titled “Payment in Electronic Commerce,” Nguyen Tran Hung explores the fundamental theories of payment activities within the realm of electronic commerce across three chapters The work delves into the current e-payment systems and highlights the critical role of security technology in electronic payment processes Additionally, it discusses the significance, advantages, and limitations associated with electronic payment methods By providing a theoretical framework for understanding electronic commerce, the thesis illustrates its growth potential in Vietnam and includes examples from developing countries Overall, Hung’s thesis effectively underscores the concept of electronic payment and its vital importance in today’s integrated economy.
Hy, Le Van's (2009) thesis, “Online Payment and Electronic Wallet,” serves as a foundational resource on electronic payment and wallet systems in Vietnam The author asserts that Vietnam's electronic commerce is poised for significant growth, necessitating the evolution of electronic payment services to support this advancement Key concepts such as e-payment and electronic wallets are defined, alongside an analysis of current providers in Vietnam, detailing their strengths and weaknesses The thesis emphasizes that to enhance the quality of electronic payment services, companies must devise targeted strategies to address existing limitations while leveraging their advantages for future success.
Tyree, A (2000) published a thesis that named as “ Virtual Cash - payment on the internet ” This thesis provides basic and clear concepts of online payment method
The thesis outlines essential criteria for evaluating the quality of online payment service systems and popular online payment models This analysis is crucial for understanding how the service quality of electronic payments impacts the growth and market expansion of companies offering these services.
In my thesis, I will use the collected knowledge in the thesis to build the research model to assess service quality of electronic payment of NAPAS JSC
In 2011, researchers from the University of Economics Ho Chi Minh City conducted a study titled “Research on the Actual Situation of Electronic Payment Systems in Vietnam,” which explored the concepts, characteristics, advantages, and disadvantages of various electronic payment systems The research examined the global and Vietnamese development of electronic payment forms, identified popular models in use today, and analyzed factors influencing the electronic payment service system in Vietnam Additionally, it reviewed successful intermediary electronic payment websites both domestically and internationally to inform the future development of electronic payment in the country Consequently, electronic payment service providers must proactively refine their business strategies and address existing limitations to enhance revenue and market share, contributing significantly to the service quality improvements at NAPAS JSC.
So, in recent years, there have been many research projects on the quality of electronic payment service as follows:
Choi, Stahl & Whinston (2010) conducted a detailed study on the quality of electronic payment service systems in the United States, focusing on the concept and influencing factors of electronic payment systems Utilizing SPSS software for data analysis, the authors identified both the strengths and weaknesses of electronic payment services They proposed solutions to enhance the quality of these services, although some recommendations remained general and lacked specificity.
Craig D Mason's 2011 research, "Effect of the Quality of Electronic Payments Service to Increase the Sales of Service Companies," examines how electronic payment service quality influences market share growth for service companies in the UK By analyzing the current state of electronic payment services and gathering data from customer interviews, Mason highlights the positive impact of service quality on revenue growth for these companies Similarly, Le Duy Hung's 2013 study, "The Payment in Electronic Commerce in Vietnam," explores the theoretical foundations and processes of electronic payments in e-commerce This research also evaluates the development of electronic payment systems in Vietnamese enterprises from 2010 to 2014, ultimately proposing strategic solutions to enhance electronic payment services in Vietnam.
2015 -2020 However, because the research topic is quite general and research problem is quite broad, the topic cannot be in the details and delve into research problem
In 2014, Le Duc Tung conducted a study on the development of electronic payment systems for enterprises in Vietnam The research highlighted key issues surrounding electronic payment services in the country and assessed the current quality of these systems It emphasized that the safety and security of customer financial information are critical factors influencing the effectiveness of electronic payments for Vietnamese businesses However, the study's proposed solutions lacked specificity and detail regarding future improvements to enhance the quality of electronic payment systems in Vietnam.
(3) Experimental studies that relate to issues of service quality and expand market share
The author did not identify any research directly linking service quality to increased market share; however, several studies may provide valuable insights for understanding this relationship.
According to Zeithaml et al (1996) in their study "The Behavioral Consequences of Service Quality," published in the Journal of Marketing, companies that provide superior service experience significantly higher market share growth compared to their competitors.
According to Buzzell and Gale (1987), service quality significantly impacts profitability through mechanisms such as enhanced market share and the ability to command premium prices, as noted by Phillips, Chang, and Buzzell (1983) This indicates that companies providing superior service quality are likely to capture a larger market share.
In their 1993 study "Customer Satisfaction, Customer Retention, and Market Share," Rust, Roland T., and Anthony J Zahorik highlight the importance of investing in existing customers rather than solely focusing on acquiring new ones Citing Fornell and Wernerfelt's findings, they suggest that enhancing service quality can lead to greater benefits for companies, ultimately helping to retain current customers and maintain market share.
On the other hand, many researchers (Trang, 2006) support for the conclusion that
Customer satisfaction and loyalty are closely linked; enhancing service quality boosts customer satisfaction, which in turn fosters loyalty and helps retain existing customers This retention is crucial for maintaining market share Furthermore, satisfied customers are likely to recommend the company to others, contributing to market share expansion.
In conclusion, a review of relevant studies both globally and in Vietnam has equipped the author with foundational knowledge about electronic payment services and their impact on service quality This understanding is crucial for assessing the expansion and market share of companies providing these services The thesis will facilitate the development of models to evaluate the service quality of NAPAS's electronic payment offerings, providing a significant theoretical framework for this research.
Aims of research
Conduct an analysis of the current quality of payment services at NAPAS JSC to identify strategies for enhancement Improving these services is essential for increasing the company's market share and ensuring customer satisfaction.
- Systematize the basic theoretical issues about the electronic payment and quality of electronic payment service
- Assess the effect of factors affecting the quality of electronic payment service and then find out its effect on expanding market share of NAPAS
- Find out the advantages and limitations in activities of electronic payment service at NAPAS
- Propose solutions to improve quality of electronic payment service to expand market share of NAPAS and give recommendations to relevant units.
Objects of research
The main object of this research is “The impact of the electronic payment quality on the market share expansion of NAPAS company”.
Scope of research
Location scope: The research is carried out at NAPAS JSC
The research is carried out from Aug, 2016 to Dec, 2016 Solutions applicable until
Research methodology
The model of the topic is synthesized and built from previous researches In which:
Based on Paret and Lyapunov, 2000
Based on Paret and Lyapunov, 2000
Safety and security of the system
Safety (confidentiality) based on Nguyen Ngoc Hien, 2003
The security based on Gary P.schneider, 2000
This is characteristic to ensure the accuracy of electronic payment system, including pricing, tax, product information, etc (Nguyen Ngoc An and Nguyen Van Hoang, 2003)
The user-friendly interface of a website is essential for effectively presenting products and services, as it enhances the accessibility of information and facilitates the use of electronic payment systems (Tran Ba Thai, 2005).
The author builds a model to assess the effect of factors on the quality of the electronic payment service based on original assessment model of service quality of Parasuraman (1988)
Qualitative research: Qualitative research is used through group discussion In group discussion, the author will run a survey of 30 people as follows:
- 25 customers who use payment services of NAPAS
Qualitative research aims to explore and refine research concepts, with interview findings indicating unanimous agreement among participants regarding the impact of payment services on customer satisfaction Consequently, the author employs this set of factors for further investigation.
Quantitative research is conducted to analyze the factors influencing customer satisfaction and market share growth for NAPAS, utilizing insights gained from qualitative research The author develops questionnaires and conducts surveys, targeting a sample size of 300 customers to gather relevant data.
According to Roger (2006), a minimum sample size of 150-200 observations is essential for practical research Additionally, Hair, Anderson, Tatham, and Black (1998) suggest that the required sample size can be determined by multiplying the number of questions (n) by 5.
This research utilized a questionnaire comprising approximately 30 questions, necessitating a minimum sample size of 150 observations based on the model's requirements To enhance the generalizability of the findings, the author opted for a larger sample size of 300 observations.
The author plans to conduct direct interviews with customers, as well as telephone interviews, to gather valuable insights Additionally, the annual customer conference presents an excellent opportunity to collect a diverse range of customer ideas and feedback simultaneously.
+ Secondary data: secondary data will be collected at NAPAS in the period from
+ Primary data: The research will focus on collecting primary data within 3 weeks from 2 nd September, 2016 to 20 th September, 2016.
Thesis structure
The intended thesis structure as following:
(Not include Introduction and Conclusion)
CHAPTER 2: ANALYSIS THE CURRENT SITUATIONS
THE THEORETICAL BACKGROUND
Overview of the service quality, electronic payment service and market share 9
Service quality has been defined and conceptualized in various ways, leading to numerous measurement approaches Despite the challenges in defining it, several key concepts frequently emerge in research discussions on service quality.
Customer perceptions of quality vary significantly, making their involvement in the development and evaluation of service quality essential In the service industry, quality is largely defined by customer awareness, meaning that service quality is shaped by how well it meets individual customer needs (Bui Nguyen Hung and Nguyen Thuy Quynh Loan, 2010).
There are two components of service quality: (1) technical quality is what the customers perceive; (2) function quality interprets how the services are provided (Grửnroos, 1984)
Service quality is defined as the gap between consumer expectations and their perceptions of the actual service received (Grünroos, 1984; Parasuraman et al., 1988) It encompasses the overall characteristics of services and reflects the ability to meet user needs within specific economic and social contexts (Ngo Thi Thu, 2002).
1.1.1.2 Electronic payment and Electronic payment service
Electronic payment is a way of making payment via electronic message instead of cash (Nguyen Tran Hung, 2010)
Electronic payment refers to non-cash transactions conducted through various electronic methods, including payment cards, electronic checks, bank transfers, and electronic funds transfers It encompasses online payments, which are made directly through the internet, and batch payments, where multiple transactions are processed together, such as at supermarkets at the end of the day As a crucial component of electronic commerce, e-payment is essential for facilitating seamless transactions in the digital marketplace.
An electronic payment gateway serves as a crucial link between banks, buyers, and sellers, enabling sellers to receive payments seamlessly after online transactions Buyers can easily make payments to sellers through e-commerce websites using their registered online accounts, ensuring a convenient and efficient payment process (Le Van Hy, 2010).
An electronic payment gateway is a software solution that enables e-commerce websites to connect with payment channels like banks, facilitating seamless transactions for customers using credit accounts or credit cards This system allows users to make payments for goods and services online without the need for cash deposits or bank visits, thereby saving both time and costs Essentially, the electronic payment gateway acts as a virtual sales location, enhancing the overall shopping experience (Le Duc Tung, 2011).
1.1.1.3 Service quality of Electronic payment service
The quality of electronic payment gateway services is closely linked to the user interface and the level of service demanded by customers, as all user interactions occur through a computer interface Therefore, the effectiveness of these payment systems can be evaluated in terms of software quality and website performance (Vu Dinh Thu, 2010).
The electronic payment system is primarily composed of networked computers, client-server communications, multimedia services, and various other services The quality of these electronic payment gateway services directly reflects the system's ability to meet end-user requirements, particularly through the computer interface (HCI) Consequently, the interface quality must adhere to established software quality principles to ensure a seamless user experience (Kalakota, Winston, 2007).
The quality of electronic payment gateway services is determined by six key factors: functionality, reliability, efficiency, availability, maintenance, and portability Among these, availability is often highlighted as the most crucial aspect, as indicated by the ISO 9126 standard, which emphasizes its significance in assessing the overall quality of electronic payment systems Regular reviews of these quality factors ensure that the payment systems remain effective and user-friendly.
1.1.1.4 Market share and market share expansion
Market share is the market segment of the business has occupied In essence, it is the market segmentation of the business to competitors in the industry (Vuong Van Dao, 2013)
Expanding market share involves a combination of strategies aimed at maximizing product consumption by a business This process includes not only the development of new markets but also the enhancement of product market share within existing markets (Nguyen Van Anh, 2013).
To assess the extent of market share of a business, the manager can rely on a number of indicators, such as broadening the geographic scope of the market, creating new customers
1.1.2 Characteristics of service quality of electronic payment
+ Electronic payment services are not limited space
The first characteristic of the quality of electronic payment services is that the parties may make payments at any time and under any condition
Electronic payments allow payment partners to narrow geographic distances, widen the scope of their payments globally Electronic payment is a component of the digital economy
+ Electronic payment services are not limited in time
Electronic payment services utilize computer networks and telecommunications to enable real-time transactions, allowing users to make payments globally 24/7 This payment method offers numerous advantages, making it a convenient choice for consumers and businesses alike.
The rise of electronic payment services is driving the shift towards non-cash payment methods, diminishing the reliance on cash in traditional transactions This evolution signifies an inevitable trend in modern financial practices.
Electronic payment services to expand into new fields: exchange of electronic financial datas, electronic money, digital wallet, electronic sec, smart card, payment cards
1.1.3 Factor affecting the service quality of electronic payment
The effectiveness of the payment gateway
The efficiency of an e-payment gateway system is determined by its ability to handle customer requests effectively, which is evident in the rapid processing of transactions and the accuracy of information management.
If the electronic payment system works more efficiently, the quality of the system of higher and the more satisfied the customer
The stability of the system
The stability of an electronic payment gateway is crucial for delivering high-quality service, as it directly impacts transaction processing speed and the accuracy of transaction information A reliable electronic payment system is characterized by its high stability, minimal issues, and the absence of errors or interruptions, ensuring a seamless experience for customers during transactions.
The safety and security of the system
Security and security are the prerequisite for any electronic payment system This factors are to ensure confidential information, the privacy rights of the account holder to use the service
Customers typically possess key information like their address, phone number, account number, and hobbies Electronic payment systems empower users to choose whether to share their information openly or keep it private, and they can also opt to include additional details.
The electronic payment system is more secure and secure, the quality of the system of higher and the more satisfied the customer
Consistency is the characteristic that ensures the accuracy of the electronic payment system include issues such as pricing, taxation, product information
Consistency is expressed in the preparation of the content of the Website so that more accurate information, as well as the preparation of videos, images guide the payment process
The more consistent the e-payment system is, the better the quality is and vice versa
The friendly level of the interface
The interface is full of the images that the user can see on the Web pages of electronic payment
Assessment models for service quality of electronic payment and relationship of
1.2.1 Assessment model for service quality of electronic payment
1.2.1.1 Assessment model for service quality of Parasuraman 1988
Parasuraman (1988), known as the father of the service field, developed the SERVQUAL model to evaluate service quality This model is based on the premise that perceived service quality arises from the comparison between customer expectations and the actual value they receive.
The SERVQUAL model, comprising five key components, has been extensively utilized since its introduction (Asubonteng et al., 1996; Buttle, 1996; Robinson, 1999) and is widely recognized as an effective tool for assessing service quality Its acceptance among researchers and its application across various industries and sectors highlight its versatility and global reach, with usage reported in countries such as the USA, UK, Singapore, Korea, Malaysia, Saudi Arabia, and Kuwait This widespread adoption suggests that SERVQUAL is one of the most prevalent methods for evaluating service quality across diverse fields.
Difference 1 Difference between expectation of customers and awareness of managers on expectation of customers Difference 2 Managers incorrectly transmit or can‟t transmit expectation of customers into procedure, specifications of quality
Difference 3 Staff don‟t work under proper procedure
Difference 4 Advertise and introduce incorrectly
Difference 5 Total of above difference, difference between received service and expectations of customers 5-different model is general model with its theoretical nature of service quality To be able to practice, Parasuraman et al tries to build the scale used to assess the quality in service field According to him, for any service, customers perceive quality basing on 10 following components: Reliability, Responsiveness, Competence, Access, Courtesy, Communication, Credibility, Security, Understanding customer, Tangibles
The advantage of this model lies in its comprehensive coverage of nearly all service aspects; however, it presents challenges in assessment and analysis In 1988, Parasuraman et al refined this model to include five key components: Reliability, Responsiveness, Competence, Sympathy, and Tangibles.
Model 1.1: Scale for service quality assessment SERVQUAL
According to Parasuraman's (1988) research model, numerous studies have developed service quality assessment models across various service sectors When implementing these models in real-world research, the number of factors influencing service quality may vary, potentially exceeding or falling short of the original five factors These factors are also subject to change based on the specific industry and research context, highlighting the adaptability of prominent research models in different service fields.
1.2.1.2 Assessment model for service quality of online banking of Broderick and
In their research, the authors analyzed social websites in the UK to understand customer awareness of internet banking and its influencing factors They identified five key elements that significantly impact the perception of service quality in online banking: customer expectations, visual content, organizational reputation, service setup, and customer engagement.
Model 1.2: The assessment model forquality of online banking service
Source: Broderick and Vachirapornpuk (2002) 1.2.1.3 Assessment model for quality of electronic payment of ISO 2005
The ISO-International Organization for Standardization and the IEC-International Electrotechnical Commission have introduced the ISO/IEC 9126 standards to assess software quality This initiative is overseen by project ISO 25000:2005, which defines a software product quality model, outlines key quality characteristics, and establishes metrics for quality evaluation.
Under ISO 9126 standard, there are 6 groups of factors affecting the quality of electronic payment gateway, including factors as following model:
Model 1.3: Research model under ISO 9126 standard
Image, reputation of the organizations
Perception of service quality Customer expectation
Quality of electronic payment gateway
Base on model 2.3, we can see that research model under ISO 9126 standard includes
6 factors: functionality, reliability, efficiency, usability, maintainability and portability The research results show that all these factors have positive effect on the quality of electronic payment gateway service
When evaluating electronic payment systems, usability is frequently regarded as the most critical aspect of software quality However, it is essential to recognize that other quality factors, such as operational performance, reliability, and efficiency, also significantly influence user experience and satisfaction.
1.2.1.4 Assessment model for quality of electronic payment of Liliana Solís 2011
British economist Liliana Solís (2011) has made significant contributions to the study of electronic payment gateway service quality in UK enterprises Her research identifies key factors influencing service quality, which can be summarized in a comprehensive model.
Model 2.4: Research model of the author Liliana Solís (2011)
Source: Liliana Solís (2011) 1.2.2 The relationship between service quality and market share expansion
Service quality plays a crucial role in determining an enterprise's ability to expand its market share, as high-quality services increase the likelihood of attracting more customers and, in turn, driving market growth Research by Curry and Sinclair (2002) supports this notion, highlighting that meeting customer expectations through superior service quality leads to customer satisfaction, ultimately enabling enterprises to gain a larger market share.
Consistency Safety and security of the system
Quality of electronic payment gateway
Improving service and product quality is essential for enhancing customer satisfaction and loyalty, as noted by Wicks and Roethlein (2009) Satisfied customers are more likely to continue using a company's services and recommend them to others, ultimately increasing revenue opportunities Additionally, Al-Wugayan et al (2008) emphasize that high service quality is crucial for retaining existing customers and attracting new ones, which in turn boosts business efficiency and market share.
Numerous studies in the e-commerce sector, including research by Craig D Mason (2011) and Choi, Stahl & Whinston (2010), have highlighted the critical role of service quality in enhancing market share This significance extends beyond e-commerce, impacting all business sectors.
Based on Parasuraman's original 1988 assessment model of service quality, extensive research has been conducted on measuring service quality, particularly in the context of electronic payment gateways Numerous authors have developed their own assessment models for this purpose Drawing from previous studies and the established relationship between service quality and market share growth, I propose a research model for this topic.
Model 2.5: Proposed asessment model of quality of electronic payment gateway of the topics
The model of the topic is synthesized and built from previou researches In which:
Safety and security of the system
Quality of electronic payment gateway
The system's capability to optimize resource conservation and enhance operational efficiency under specific conditions is crucial (Paret and Lyapunov, 2000) This effectiveness is influenced by two key factors.
This feature describes the ability to maintain a specific level of performance under different conditions
Stability is essential for an automatic system, as it must be able to self-adjust and return to its balanced state after experiencing any changes or impacts (Paret and Lyapunov, 2000).
Safety and security of the system
Five components, which are identified in the related electronic payment are confidentiality, authentication, access control, accountability and use of data (Nguyen Ngoc Hien, 2003)
ANALYSIS THE CURRENT SITUATION
Introduction about NAPAS.JSC
2.1.1 The process of formation and development
NAPAS JSC (NAPAS) was established by the Joint Stock Commercial Bank for Foreign Trade of Vietnam in collaboration with 15 other joint-stock commercial banks Its primary aim is to professionalize and diversify services related to non-cash payment transactions, aligning with the policies set forth by the Government and the State Bank of Vietnam.
NAPAS currently operates an advanced information processing system linked to 51 member banks, financial institutions, airlines, telecommunications companies, and large enterprises across Vietnam This system facilitates convenient payment services through various electronic transaction channels, including ATMs, POS terminals, mobile phones, and the Internet NAPAS focuses on providing and enhancing a range of key services to meet the growing demands of digital transactions.
1 Electronic data processing service for financial transactions - NAPAS Switching includes:
- Data processing service for ATM transactions
- Data processing service for POS transactions
2 Payment gateway service - NAPAS Payment Gateway includes:
- Online payment gateway via Internet (e-Commerce)
- Electronic payment gateway for Topup, Billing
3 Service of providing solutions and payment methods for electronic wallet - NAPAS eWallet
4 Service of training, consulting and developing card services and electronic payment
After 6 years of operation, NAPAS has expanded the connection of ATMs, POS system for member banks with a network of 16,000.00 ATMs and 105,000.00 POS and accepted payment for 55 million domestic cardholders of domestic and foreign banks in Vietnam
NAPAS has established partnerships with major domestic entities, including prominent airlines like Vietnam Aviation Corporation, VietJet Aviation Joint Stock Company, and AirAsia, as well as telecommunications companies and significant enterprises offering goods and services in Vietnam.
The Vietnam Military Telecommunications Group, Vietnam Mobile Telecom Services Company, Viet Nam Telecom Services Company, and Vina Group, Jsc are enhancing customer convenience by offering essential payment services through electronic transaction channels, including ATMs, POS systems, mobile phones, and the Internet In terms of international collaboration, NAPAS is actively exploring partnerships to integrate its system with global card organizations such as Visa, MasterCard, American Express, China Union Pay, and JCB, thereby equipping banks with modern payment support services.
2.1.2 Introduction about electronic payment gateway service (NAPAS Payment Gateway)
NAPAS Payment Gateway is the service to process the authentication and license electronic payment transactions on the internet environment
The NAPAS Payment Gateway empowers banks to enhance their online payment capabilities, facilitating transactions for both international credit cards and domestic debit cards on websites integrated with the NAPAS system.
- International cards: Visa, MasterCard, American Express, JCB…
- Domestic debit cards: Domestic payment cards (ATM) issued by the banks
NAPAS Payment Gateway is a prominent online payment solution in Vietnam, leveraging connections with over 30 member banks It adheres to the highest security standards in the finance and banking sectors, as well as those set by international card organizations.
- Number of international cards, domestic cards which are accepted on NAPAS Payment Gateway are the biggest and widest
- Connect with many large enterprises and many customers who have online payment habit such as VietnamAirlines, VinaGames, Ngan Luong, Bao Kim, etc
- Implement with the member banks quickly, simply on existing Switch connection platform
- Transaction process is standardized, simple, unified, easy for the customers to use
- The flows of transactions are standardized to minimize transaction risks, errors, improve service quality
- Provide more diverse payment channels based on existing connection with the banks
- Tools for control, automatic settlement are under the standards of finance and banking field
- Tools for transaction report for the banks and sales units, risk management, systems for monitoring and warning fake transactions under international standards
NAPAS Payment Gateway enables enterprises with e-commerce websites to accept online payments as following model:
+ Model of domestic card payment
- Customers purchase goods and services on the websites and choose the payment methods
- Customers will be switched to interface of NAPAS online payment gateway
- Customers fill in their card information and confirm the payments
- NAPAS online payment gateway will transfer payment request to the international card organizations to process
Upon receiving confirmation of payment transactions from international card organizations, the NAPAS online payment gateway promptly notifies the card acceptance unit and informs customers with a success message regarding their transaction.
+ Model of domestic card payment
The payment process for domestic cards mirrors that of international cards After completing a purchase, customers are directed to the NAPAS online payment gateway, where they enter their card information to confirm the transaction.
Its difference compared with international payment gateway: NAPAS sends payment request to the issue bank
2.1.3 Business operation results of the company
The business operation results provide a comprehensive overview of the operational status of NAPAS JSC To assess these results, the author analyzes the data presented in the following table.
Table 2.1 : Business operation results of the Company
Net revenue from sales and rendering services
Cost of goods sold 6,861,973 8,286,779 20,300,932 1,424,806 20.76 12,014,153 144,98 Gross profit from sales and rendering services
Financial cost 200,000 603,512 1,003,395 403,512 201.76 399,883 66,26 Net operating profit 6,895,015 7,977,955 16,840,463 1,082,940 15.71 8,862,508 111,09 Other profit 590,136 743,407 718,568 153,271 25.97 -24.839 (3.34)
Earnings before tax 7,485,151 8,721,362 17,559,031 1,236,211 16.52 8,837,669 101.33 Current business income tax charge
Source: Data of NAPAS JSC
Between 2014 and 2016, the company's revenue experienced consistent growth, with a notable 23.38% increase in 2015 compared to 2014 Furthermore, in 2016, revenue surged by an impressive 121.01% compared to the previous year, 2015.
It proves that service-providing activities of the company are well implemented
In the latter half of 2015, the economic landscape experienced price fluctuations due to the global economic crisis, impacting many domestic enterprises, including NAPAS JSC To counter the risk of losing market share from a reduced number of familiar partners, the company's leadership implemented strategic adjustments in service pricing and incentives aimed at boosting revenue As a result, NAPAS JSC achieved a 16.52% increase in profit after tax compared to 2014, demonstrating resilience amidst challenging market conditions.
In 2016, our country witnessed significant growth in international payment activities, prompting our company to capitalize on this opportunity by securing numerous contracts with major partners, including Vietnam Mobile Telecom Services, Vietcombank, Agribank, and VnExpress As a result, the company's service revenue surged by 121.01% compared to 2015, while sales expenses rose by 26.26% and general and administrative expenses increased by over 51.67%.
In the past three years, NAPAS JSC has experienced positive growth in its production and business operations, indicating effective management and a successful diversification of products and services that have boosted revenue since 2013 Notably, the rise of electronic payment gateway services has played a crucial role in enhancing the company's income and profits To sustain this momentum, it is essential for the company to implement policies and measures aimed at improving service quality, ensuring a continuous increase in revenue from its services.
Actual situations on market share of NAPAS JSC
2.2.1 Actual situation on the revenue of NAPAS JSCin comparison with other companies in the same field
Revenue from service provision is a crucial indicator of an enterprise's consumption capacity across various sectors This analysis focuses on NAPAS JSC, comparing its revenue to that of competitors within the same industry to assess its market impact The findings are detailed in the accompanying table.
Table 2.2 Revenue of NAPAS JSCin comparison with other companies
The data indicates a consistent increase in revenue from non-cash payment services at the company, particularly for NAPAS JSC, which saw significant growth from 2012 to 2016 Specifically, revenue rose from 9,908,297.00 thousand dongs in 2012 to 39,727,852.00 thousand dongs by 2016, highlighting a robust upward trend in service revenue over the years.
Since its establishment in 2012, Vietnam Payment Solution JSC (Vnpayment) has consistently led the non-cash payment sector, achieving remarkable revenue growth from 23,092,154 thousand dongs in 2012 to 47,091,023 thousand dongs in 2016 As a pioneer in the industry, Vnpayment has built a strong reputation among customers, solidifying its position as a trusted provider Competing firms such as Onepay, Mobivi, and M-Service are also notable players in the market, actively vying for increased market share.
Over the years, companies have significantly increased their market share in service revenue To evaluate this growth, the author conducts a comparative analysis of the market share among these firms.
2.2.2 Market share in rendering services of NAPAS JSCin the market
Analyzing the market share of NAPAS JSC over the years in comparison to its competitors provides valuable insights into the company's recent market expansion The table below, compiled through thorough research and data collection, illustrates the market share dynamics of NAPAS alongside its competitors.
Table 2.3 Market share in rendering services of NAPAS JSC
Name of the company Năm 2012 Năm 2013 Năm 2014 Năm 2015 Năm 2016
Onepay Online Service and Commercial JSC 9.25% 11.18% 11.72% 14.85% 17.76%
Between 2012 and 2016, Vietnam Payment Solution JSC (Vnpayment) emerged as the leading competitor to NAPAS in the non-cash payment sector, achieving a peak market share of 34.40% in 2012 However, Vnpayment's market share has gradually declined over the years By 2016, NAPAS JSC recorded its highest market share at 24.93% Overall, while NAPAS has consistently maintained a market share higher than most competitors, it still trails behind Vnpayment Consequently, the growth and expansion of NAPAS JSC's market share are essential components of the company's current strategies and initiatives.
2.2.3 Number of major partners of NAPAS JSC in comparison with other companies in the same field
Analyzing the number of partners associated with NAPAS JSC and comparing it to other companies is a valuable method for evaluating NAPAS's competitive strength in the market This insight enables company leaders to identify opportunities for acquiring new partnerships, ultimately facilitating market expansion for their products and services.
Table 2.4 Major partners of NAPAS JSCin comparison with the ones of other companies
Name of the company Năm
The growth of partners at NAPAS JSC has been significant, reflecting the Sales Department's success in boosting revenue and expanding market share From 32 major partners in 2012, the number rose to 51 by 2016, a milestone year marked by contracts with esteemed organizations like VnExpress, Vietcombank, Agribank, and Mobifone While NAPAS has fewer partners than Vietnam Payment Solution JSC (Vnpayment), which increased from 36 to 60 partners in the same period, it still outpaces other competitors in the market This disparity is largely due to Vnpayment's strong reputation and advantages within the industry.
Vietnam Payment Solution JSC (Vnpayment) stands out as a leading competitor to NAPAS, excelling in both reputation and market share To successfully expand its market presence, NAPAS JSC must thoroughly analyze the strengths of its competitors and focus on improving service quality to boost its reputation among customers.
2.2.4 Activities of NAPAS JSC in the market share expansion
To enhance market share and boost revenue in service rendering, NAPAS JSC has engaged in various impactful activities This study aims to assess NAPAS's competitive capacity relative to other companies in the non-cash payment support sector by analyzing their market expansion efforts The findings of this research are detailed in the accompanying table.
Table 2.5 Activities to expand market share of NAPAS JSC NAPAS
Onepay Online Service and Commercial JSC
Online Mobile Services JSC (M-service)
Viet Phu Payment Support Corp (Mobivi)
- Increase accuracy for transactions with customers
+ Improve product quality and customer service
- Design new features for users
- Ensure accuracy for transactions with customers
+ Improve product quality and customer service
- Ensure consistency for money transfer transactions
- Increase security of the system
- Improve stability of the system
+ Cooperate with many prestigious organizations
+ Invest in modern technology functions for users
- Set up a lot of language interfaces for customers + Invest modern technology for the system + Pay attention to severing close customers + Diversify products and services access
- Increase accuracy for the transactions
- Set up error notification system when having transaction error
- Ensure security of customer information
- Beautiful interface + Focus on customer service + Diversify products and services + Invest in technology
+ Promote to seek customers + Frequently upgrade the system
- Auto support customer if necessary
- Speed up money transfer transactions
To enhance customer experience, it is essential to establish multiple language interfaces that cater to diverse clientele Investing in the expansion of the transaction network will facilitate smoother operations and increased accessibility Additionally, prioritizing the training and development of staff is crucial for maintaining high service standards Ultimately, recognizing customer engagement as the top priority will drive business success and foster lasting relationships.
Research into market share expansion in the non-cash payment sector reveals that companies engage in various activities to enhance their product and service consumption A common strategy among these companies is the improvement of product and service quality, although approaches may vary This underscores the critical role of service quality in driving market share growth within the non-cash payment industry.
NAPAS JSC prioritizes improving service quality to expand its market share, implementing various initiatives such as accelerating transaction speeds, enhancing transaction safety, and bolstering system security Additionally, the company focuses on designing a user-friendly interface and improving system stability and transaction efficiency These factors are crucial for enhancing NAPAS's service quality and driving its overall market share growth.
To effectively expand market share, NAPAS JSC must prioritize service quality in its strategies By focusing on enhancing service delivery, the company can better achieve its goals for market share growth in the future.
SOLUTIONS AND RECOMMENDATIONS
Solutions to improve the quality of electronic payment service
3.1.1 Training the technical staff of the company
Implementing comprehensive training programs for technical staff is essential to enhance their professional expertise and familiarize them with advanced features This initiative will also focus on establishing new risk warning and management systems, alongside improved security methods Additionally, recruiting more technical personnel will ensure efficient troubleshooting and minimize system upgrade times as required.
NAPAS JSC faces challenges in finding skilled personnel to operate its electronic payment gateway services, which are crucial for business development As the company's scope and scale continue to expand, having a competent workforce becomes increasingly important for effective service delivery.
It also means that happened shortage of highly qualified labor with specialized training in electronic payments
To enhance the quality of human resources in electronic payments, the Company can focus on two key strategies: recruiting skilled professionals from external sources and providing training to develop internal talent.
To address immediate needs, companies should prioritize training their internal resources by facilitating employee participation in short courses that enhance skills and qualifications These courses are essential for improving the quality of electronic payment gateway services and other applications that benefit users Additionally, for external recruitment, companies should target young, knowledgeable candidates with expertise in IT, e-commerce, and strong customer communication skills Sourcing talent from universities, research institutes, and international graduates is crucial Implementing a competitive remuneration policy will attract these skilled individuals, significantly enhancing the company's competitiveness and service quality.
Training the business staff is capable of communicating with customers and implement transactions with partners in providing services
Training the skills administrator of Site and transaction processing such as:
+ Handle email: write emails, answer emails to customers
+ The basic operations for troubleshooting on the system popular
+ The administrator tasks: put images onto the system, the system administrator, updated information, the transaction processing operations,
3.1.2 Completing the system interface gateway payment services of the Company to raise the level of customer friendliness
The design and construction of an electronic payment system interface for transaction offices is crucial for both domestic and international markets However, having a functional interface is only a starting point; continuous improvement in presentation, information updates, and user-friendliness is essential An attractive payment gateway interface is vital, as outdated advertisements, broken links, or slow response times can frustrate visitors and damage the company's reputation, necessitating their removal.
An interface is considered to be friendly, to attract users when it satisfies the following factors:
- Present simple with easy to implement guidelines
- Number of connections is at least
- Engaging content without slowing down the operation of the system
- To ensure safety and reliability for users
In the future, the company should implement new technology applications in the design interface to create a more modular page system, enhancing user-friendliness and overall user experience.
- Establish a system language: Vietnamese, English, Chinese, Japanese, French, and distinguished by IP access to express language (Eg: customers in China access the display language exam is automatically Chinese)
To enhance the presentation of content, it is essential to transition from manual column adjustments to a structured approach utilizing a Content Management System (CMS) This system standardizes the format for new content, ensuring consistency While the company's service quality has improved, especially in electronic payment transactions, a regular review of the payment gateway system is crucial This should not be limited to infrequent updates but should include ongoing assessments of pricing and service information, ensuring accuracy and reliability for customer satisfaction Recognizing the interface as a vital communication channel is important; a well-organized electronic payment gateway enhances customer experience by facilitating easy navigation Implementing visible links to various features and a search engine will empower customers to efficiently find the services they need.
In the cashless service sector, the system interface is designed to facilitate customer transactions by providing essential information and updates on available services Additionally, the company should regularly update and offer valuable information related to its services at no cost, thereby boosting viewer trust and enhancing the overall perception of the company.
On the system should have full address, service instructions placed by phone or the service functions by email, through the form located service
3.1.3 Expanding cooperation, linking with organizations large e-commerce, popular with users of Vietnam
In today's digital landscape, the significance of organizations and e-commerce websites is rapidly growing, particularly in the business sector By collaborating within an e-commerce framework, companies can enhance mutual support in online operations, share costs related to application deployment and IT infrastructure, safeguard one another against potential disputes in the evolving business environment, and strengthen their collective presence through a unified approach.
Companies should consider joining the e-commerce Association of Vietnam (Vecom) to take advantage of numerous member benefits, including access to security software and network security support Membership also promotes national development for businesses while providing opportunities for collaboration with other companies across diverse sectors, ultimately facilitating business expansion.
3.1.4 Investment and application of modern technology, advance to the work raising, improve the quality of the system's electronic payment gateway company to avoid limiting condition system crash
To enhance the electronic payment gateway system, companies must focus on developing advanced software that facilitates faster and more accurate transactions while ensuring robust security against hackers and theft By prioritizing these improvements, businesses can significantly boost the safety and reliability of the services they offer to users.
Companies should assess their existing technological equipment and consider upgrades where feasible Additionally, it is essential to invest in new computer systems that meet work demands, prioritizing machines with high processing speeds to enhance payment processing efficiency.
Investing in advanced equipment and high-speed computing, along with ensuring compatibility between hardware and software, enables companies to streamline transaction processing This efficiency not only attracts more customers but also enhances the company's competitive position in the market.
The company also attaches great importance to the maintenance, maintenance of computer equipment, software testing regularly check the backup device, besides, attach importance to the security and data storage
To retain existing customers while attracting new ones, the company must enhance the quality of its payment gateway services This includes increasing the success rate of transactions through effective system monitoring and control Additionally, establishing a 24/7 customer service center will ensure that customer inquiries are addressed promptly and efficiently.
To enhance transaction accuracy and minimize billing errors, coordination with member banks is essential for guiding customers in making payments, particularly to prevent issues like incorrect password authentication or repeated entry of wrong information Additionally, simplifying the online payment registration process for credit card users by enabling self-registration through online platforms or ATMs is crucial Furthermore, establishing backup links is vital to reduce system failures, especially during peak promotional periods for service providers.
Solutions expand market share of NAPAS
3.2.1 Solution to attract customers using NAPAS e-payment portal
To be able to continue attracting more customers using electronic payment gateway services of NAPAS in the near future NAPAS should promote solutions to expand market such as:
In response to the rapid evolution of e-commerce and payment methods, NAPAS is launching e-payment training courses to help customers stay updated with the latest trends This initiative not only generates additional revenue for NAPAS but also enhances brand visibility and promotes the diverse range of products and services offered by the company.
To effectively promote the NAPAS e-payment portal to both domestic and international customers, active participation in economic fairs is essential These events attract large businesses and organizations that represent potential future clients for NAPAS, a leading provider of comprehensive electronic payment solutions Engaging in these fairs not only enhances visibility but also allows NAPAS to showcase the quality of its services to a broader audience, creating valuable advertising opportunities.
After Vietnam signed the TPP Agreement in 2016, the country faced increased competition from global markets, prompting the organization of numerous economic development seminars NAPAS should actively participate in these workshops to share insights from a young entrepreneur's perspective and propose innovative e-payment solutions that can boost the competitiveness of Vietnamese enterprises This engagement not only contributes to the national dialogue on economic growth but also serves as an excellent opportunity for NAPAS to enhance its brand visibility among potential customers.
NAPAS, a leading electronic payment company in Vietnam, should proactively conduct annual evaluation meetings to showcase its achievements and attract media attention These meetings will serve as a platform for gathering customer feedback on NAPAS services and forecasting market trends for the coming years By doing so, NAPAS can assist its customers in refining their strategies to align with market developments.
Active participation in seminars and fairs, along with engaging with customers across various channels, will enhance NAPAS's visibility and reputation This approach will establish NAPAS as a trusted provider of secure electronic payment services among consumers, while businesses will recognize NAPAS for its diverse, high-quality offerings As a leading player in Vietnam's electronic payment market, NAPAS is poised for continued growth and recognition both now and in the future.
3.2.2 Group solutions to improve the security of electronic payment of NAPAS
NAPAS electronic payment gateway currently utilizes authentication programs from international card organizations, including MasterCard Security Code, Verified by Visa, J Secure, and AVS These programs assist banks in verifying cardholders' identities and help protect customers from potential risks By implementing a secret code provided by the issuing bank, in line with international standards, customers are safeguarded This solution not only enhances security for cardholders but also enables businesses to mitigate risks and seek reimbursement when necessary.
While current programs provide protection and authentication for customers after completing the registration process, they still face risks of personal information exposure through keyloggers and computer worms when entering sensitive data like card account numbers and passwords To improve customer security throughout the payment process, NAPAS should explore additional methods to safeguard information transmission and enhance overall customer security.
Utilizing virtual keyboard technology enhances security on payment websites by enabling customers to input their personal information, such as account numbers and passwords, through a virtual interface This method effectively prevents keylogger detection, ensuring that sensitive data remains protected during online transactions.
To enhance payment security, our website employs advanced digital matrix technology to authenticate each transaction During the payment process, a unique two-dimensional matrix number is displayed on the interface Customers are required to input this matrix information by column via SMS, which is then sent to NAPAS's digital service for verification before entering their payment card details on the site.
NAPAS offers an efficient e-wallet technology that simplifies the payment process for customers Upon registration, users only need to provide their payment card information once, which is securely encrypted and stored on NAPAS servers For future transactions on various partner sites, customers can conveniently access their electronic wallet by entering just their wallet information and password, eliminating the need to repeatedly input sensitive payment details This streamlined approach not only enhances user convenience but also significantly reduces the risk of exposing personal information during online transactions.
Figure 3.1: Electronic wallet technology model
3.2.3 Solutions for the development of customer support services
NAPAS is actively enhancing its support for customers looking to implement e-payment gateway systems on their websites, offering consultancy services for developing electronic payment platforms and building online sales teams To establish itself as a comprehensive e-payment solution provider, NAPAS needs to intensify its business support efforts in various activities.
- Sales regulations and policies in e-commerce
- Process and operate an online business
- Risk management in electronic payment
- Payment card and payment system
- Invoice of electronic voucher, electronic signature in electronic payment gateway
NAPAS should enhance its promotion of electronic payment transactions by highlighting the benefits and safety of e-commerce and e-payment gateways Currently, its collaboration with VnExpress to publish articles in the newspaper's shopping section has limitations, as it primarily reaches an audience that may not be highly engaged with electronic payment options To effectively reach the target demographic, particularly young people, NAPAS should consider partnering with its clients to provide educational content on electronic payments directly on their websites This strategy will facilitate a more direct approach to inform those who genuinely need electronic payment solutions.
3.2.4 NAPAS brand building and development solutions
In a competitive market, e-payment gateway providers must prioritize becoming the preferred choice for customers The uniqueness of electronic payment services often complicates the decision-making process for users, who face psychological barriers when selecting their payment suppliers.
Global electronic payment gateway service providers prioritize brand building, with established names like Visa and MasterCard leading the way in customer trust It's crucial for both major players and local providers to focus on branding tailored to their specific markets To strengthen the NAPAS brand, significant investment in service quality and customer confidentiality is essential, alongside robust promotional efforts aimed at consumers, who are key decision-makers Establishing unwavering trust in payment and security systems will reassure customers and encourage those unfamiliar with NAPAS to engage with its electronic payment gateway services.
Building a strong brand needs to focus on the unit's competitive advantage Specifically, NAPAS is one of the leading companies in the electronic payment market in
Vietnam's electronic payment customer base remains limited, presenting an opportunity for NAPAS to enhance its brand visibility By emphasizing its exceptional service quality, robust security measures, and a diverse range of products tailored to various business models, NAPAS can attract more users Additionally, its expertise in technology consulting and commitment to high-quality customer service, coupled with innovative solutions, positions NAPAS as a leader in the electronic payment sector.