South Korea’s Lotte has almost doubled its investment in its Vietnam consumer finance subsidiary Lotte Finance, with its total investment jumping from VND 2.46 trillion or US$96.8 million to VND 4.186 trillion or US$164.8 million. This is despite general challenges for the firm cracking the local market reported earlier this year.
Of note, demand for credit has plummeted over the last year or two as thrifty Vietnamese have tightened their belts. By the end of March credit growth was at just 1.34 percent. That said, credit cards have not proven to be very popular in Vietnam in general, with consumers tending to spend only what they have. In fact, just 6 percent of Vietnamese had a credit card according to a 2021 report from the World Bank.
That said, Lotte Finance attributed its struggles in Vietnam to initial startup costs and this increased investment seems to support the thesis that Lotte Finance still sees a lot of potential in Vietnam’s consumer finance market.