Deal Street Asia: SaaS startups double down as Vietnam’s new tax rules shake up small businesses

From June 1, 2025, household businesses earning over 1 billion VND/year (~$40,000) must issue e-invoices through certified POS systems linked to Vietnam's tax authority. This shift aims to formalize the informal economy of approximately 5.2 million businesses. However, many businesses are struggling or shutting down due to compliance burdens, costs, and digital literacy challenges. P/s: Special thanks to Deal Street Asia for featuring my comment in the article, where I shared insights about the positive long-term impact of the new tax rules, in fostering a fair and transparent market, accelerating digitalization, and unlocking potential for SaaS startups in Vietnam. Yeah, just keep fighting!

For those interested, please read the full article on Deal Street Asia and find the key takeaways below:

www.dealstreetasia.com

Household businesses with annual revenues exceeding $40k must issue electronic invoices.

1. Tax Reform Disrupts Informal Business Sector

• From June 1, 2025, household businesses earning over 1 billion VND/year (~$40,000) must issue e-invoices via certified POS systems, linked to Vietnam’s tax authority.

• The shift aims to formalize the informal economy (~5.2 million businesses), but many are struggling or shutting down due to compliance burden, costs, and digital illiteracy.

2. SaaS Sector Sees Opportunity — and Challenges

• This policy opens a rare chance to mainstream SaaS adoption among small and micro-enterprises, previously resistant to tech transformation. High upfront costs (POS, printers, e-signatures) and tax ambiguity are deterrents.

• SaaS providers like SoBanHang, Sapo, KiotViet, and MISA are competing to offer simple, mobile-first e-invoicing and tax solutions. With fierce competition from both established companies (FPT, MISA) and new SaaS entrants, success will depend on quick execution and deep understanding of the local market.

3. My key insights shared in this article:

• The Decree promotes transparency and access to finance in Vietnam. While the initial deployment phase presents challenges—small businesses often lack budget and digital literacy, and may struggle with correct invoice compliance— we would see the positive long-term impact in fostering a fair and transparent market, accelerating digitalization, and unlocking potential for SaaS startups in Vietnam

• Long-term gain: Accelerates digitalization and creates tailwinds for SaaS with tax system integration; Freemium/low-cost models; Scalable onboarding for micro users

• Emphasized data-driven value: Leveraging customer data for lending and supply chain finance, enabling financial inclusion.

• Genesia Ventures has also bet on Vietnam’s digital transition. One of our portfolio companies, Kamereo, also provides solutions to help F&B businesses issue valid invoices, not only complying with tax regulations but also supporting businesses in controlling costs.

Overall Thoughts

Vietnam’s tax digitization reform is a turning point for SaaS adoption, unlocking a massive untapped market—but also filtering out startups that can’t localize fast or build trust with low-tech users. Investors and founders should view this moment as both a regulatory shift and a go-to-market accelerator—where success will come from providing value beyond software, including user education, integration, and financial tools.

P/s: Founders interested in this topic, please book a Meeting below so we can discuss further! Thank you very much!