Voluntary Youth Public Benefit Service Co. Ltd., which is tasked with collecting fees for on-street car parking in Ho Chi Minh City, recently announced that its fee collection arm reported a VND8 billion (US$344,200) loss in 2021.
A financial statement by the company showed that its revenue from the fee collection was more than VND2 billion ($85,900) last year, a figure which pales in comparison to the firm’s VND10 billion ($429,400) in fee collection costs, including staff salaries and software rentals.
The company announced it would use revenues from other business activities to compensate for the loss.
The inefficiency of on-street car parking fee collection in Ho Chi Minh City resulted from difficulties in collecting fees and the impact of the COVID-19 pandemic, according to Voluntary Youth Public Benefit Service Co. Ltd..
In 2021, Ho Chi Minh City enacted social distancing measures to cope with COVID-19, thereby hindering fee collection operations.
In addition, residents’ awareness of the fee payment requirements remains low and vehicles owned by guests at some restaurants are often parked improperly.
The company also claimed that Myparking – the fee collection software it uses – does not work smoothly and there have been issues with processing payments.
Additionally, drivers often do not register with the app or make payments using the software.
Voluntary Youth Public Benefit Service Co. Ltd. has proposed that inspectors from the municipal Department of Transport enhance patrols and impose sanctions on those who park vehicles on the streets but do not pay parking fees.
The company also suggested that the department urge relevant agencies to handle violations on streets with car parking areas and allow the opening of more car parks in order to increase fee revenues to the point where they cover costs.
Revenues from fee collection have increased since the beginning of 2022.
In April, the revenues collected from cars parked on 20 streets in the city reached more than VND437 million ($18,800).
There is potential for this number to continue to climb if the kinks in the fee collection system are ironed out.
In mid-2018, the Ho Chi Minh City Department of Transport launched a plan to charge fees from cars parked on 23 streets in the city.
The number of streets was later reduced to 20, including 12 in District 1, three in District 5, and five in District 10.
The fees start from VND20,000 ($0.86) for the first hour for vehicles parked on streets in District 10, and VND25,000 ($1.1) for those parked on streets in District 1 and District 5.
The rates will spike progressively over the time.
The municipal Department of Transport has recently proposed expanding the fee collection to 31 streets in District 1, District 3, District 4, District 6, District 10, and Phu Nhuan District.