Remittances to Ho Chi Minh City jumped 39.5 percent last quarter: why Asia, and the Korean won, are bringing the money home

Are remittances to Vietnam recovering? In Ho Chi Minh City, yes. Money sent home by overseas Vietnamese and workers abroad reached 2.835 billion dollars in the third quarter, up 39.5 percent from the previous quarter and 3.6 percent from a year earlier, according to the State Bank of Vietnam's Regional Branch 2, as reported by VietNamNet. It was the first quarter of positive annual growth this year.

Ho Chi Minh City is Vietnam's largest destination for remittances, so its numbers are a bellwether for the country. The rebound came after two quarters of steep declines and was driven mainly by Asia, helped by the Korean won's sharp rise against the dollar. For families, banks, property markets and the dong, the recovery is a welcome signal, though the year as a whole will still fall short of 2025.

Where the money came from

Asia was the largest source by far, sending nearly 1.677 billion dollars, or 59.1 percent of the total. The Americas ranked second with 748.5 million dollars, or 26.4 percent, followed by Europe with 222.1 million dollars and Oceania with 173.2 million dollars. The mix reflects Vietnam's large workforce in South Korea, Japan and Taiwan, alongside the long established overseas Vietnamese communities in the United States and Australia.

The channels shifted too. Economic organisations that directly receive and pay out foreign currency, such as licensed remittance companies, handled more than 2.2 billion dollars, or 77.7 percent of the total, up 58.5 percent from the previous quarter. Transfers through credit institutions such as banks reached 631.4 million dollars, down slightly by 1.6 percent.

That split matters for the banking sector. Remittance companies are winning a growing share of flows, which means banks face competition for the deposits and foreign currency that remittances bring.

Why remittances rebounded

Tran Thi Ngoc Lien, deputy director of the central bank's Regional Branch 2, said the recovery was driven mainly by the Asian market, and that the Korean won's appreciation against the dollar was one factor. When the won strengthens, the wages of Vietnamese workers in South Korea are worth more in dollars, so each transfer home is larger.

The won has rebounded sharply this year on chip export revenue, as we covered in our report on the won's swing to a two year high. That currency move has quietly boosted household incomes in Vietnam.

When the Korean won rises, a Vietnamese factory worker in Ulsan gets a raise in Ho Chi Minh City without changing jobs.

Seasonal factors also helped. Lien said demand for transfers typically rises as the year end approaches, as overseas Vietnamese send money to support investment and consumption at home, including ahead of the Lunar New Year.

Why the full year will still disappoint

Despite the strong third quarter, remittances remain below last year's levels. Cumulative inflows through September reached about 6.87 billion dollars, down 13.8 percent from a year earlier, though that was a big improvement on the 22.8 percent decline recorded in the first half.

The central bank's regional branch forecasts full year remittances to Ho Chi Minh City of about 9.5 to 9.8 billion dollars, below the 10.3 billion dollars recorded in 2025. Weak first half flows, tied to global economic uncertainty and a strong dollar, will be hard to fully recover in one quarter.

Vietnam is not alone. The Philippines, another major remittance economy, has seen growth slow sharply this year, as we reported in our analysis of Filipino remittances growing at their slowest pace in four years. Rising living costs in host countries and tighter budgets among overseas workers are a common theme.

What it means for Vietnam's economy

Remittances are an important source of foreign currency for Vietnam, supporting the dong, household spending and investment, particularly in property. A rebound in the final months of the year can help stabilise the currency at a time when the central bank is directing banks to cut interest rates, which could otherwise weigh on the dong.

For banks and fintechs, the shift toward remittance companies is a competitive warning. Digital channels, cross border QR links and new payment rails are changing how money moves into Vietnam, and banks that offer faster, cheaper transfers may win back share. The key factors that will shape remittances include:

• Exchange rates in host countries, especially the Korean won and Japanese yen
• Employment and wages for Vietnamese workers in Asia
• Fees and speed of different remittance channels
• Seasonal demand ahead of the Lunar New Year
• Investment opportunities at home, particularly in property

What to expect in the fourth quarter

The fourth quarter is traditionally the strongest for remittances, as overseas Vietnamese send money ahead of the Lunar New Year. If the Korean won stays strong and employment in Asia holds up, Ho Chi Minh City could see another solid quarter, narrowing the full year shortfall further.

The risks are a renewed dollar surge, an economic slowdown in host countries or tighter rules on cross border payments. For now, the third quarter numbers suggest that the worst of this year's remittance slump has passed, and that Asia's economic strength is flowing back into Vietnamese households.

Ho Chi Minh City's third quarter rebound shows remittances to Vietnam turning a corner after a difficult first half. Asia's workers, helped by a strong Korean won, are sending more money home, and the Lunar New Year season should add to the momentum. The year will still end below 2025, but the trend has shifted in Vietnam's favour.