Vimo Technology JSC, a mobile wallet provider, and Vietnam mPOS Technology JSC, which develops portable point-of-sale technology, will merge into one entity called NextPay Holdings.

Nguyen Huu Tuat, CEO of mPOS, is set to become CEO of the combined entity while Nguyen Hoa Binh, the founder of both Hanoi-based startups, will be NextPay’s chairman.

Nguyen Hoa Binh told VnExpress that NextPay will use the payment intermediary license granted to Vimo for its operations. It is in talks with five foreign investors to raise about $30 million and anticipates closing the round in July or August this year.

The capital will be used to expand the company’s merchant network as also fund its expansion plans into Myanmar and Indonesia next year, he said.

"After five years of development Vimo and mPOS have become large-scale companies in the local payment market. And the government is enouraging cashless payment. Given these contexts, the time is ripe for such a merger."

Binh said NextPay will have a network that accepts non-cash payment services in over 40 provinces and cities with nearly 40,000 points of sale.

The future NextTech chairman also said that the synergy will help them increase their strength and competitiveness in the non-cash payment market where many "big players" are vying for dominance.

NextPay will enter into a market where other e-payment applications have mushroomed over the past few years. These include prominent names like MoMo, Moca, Viettel Pay, Zalo Pay, AirPay, and ePay.

The value of e-wallet transactions in 2017 exceeded VND53 trillion ($2.2 billion), an increase of 64 percent from the previous year, according to the State Bank of Vietnam.