Vietnam seeks to accelerate digital banking development

The online seminar on digital banking and electronic payment (VietnamPlus)

Hanoi (VNA) - “Vietnam needs to focus on restructuring the economy, promoting digitalisation and internationalisation following the COVID-19 pandemic because these are important to industrial development and sustainable development of the national economy and enterprises”, said an economic expert.

Chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc made the remark during an online seminar on digital banking and electronic payment hosted by VCCI on May 21 in Hanoi.

Electronic payment services become more and more popular

In his opening remarks, Loc said Vietnam now has 70 credit institutions and intermediary units which are providing payment services via the Internet and mobile phones. The values of financial transaction via the Internet and mobile phone channels have reached over 7 quadrillion VND and 300 trillion VND, respectively.

However, the figures are still small compared to the size of the national economy, he said.
 
Digital banking and e-wallets have many differences and have competitive advantages compared to the traditional banking model. All communication channels with customers are manipulated online via mobile devices with an intuitive and cohesive interface, Loc added.

According to Pham Quang Dung, Director of the State Bank of Vietnam’s Payment Department, electronic payment has been maintaining stable growth in recent times, especially in the context of the COVID-19 pandemic.

Statistics showed that the growth of mobile banking in Vietnam is up to 200 percent, with about 30 million people using the mobile banking payment system per day, Dung said.

Vietnam's mobile banking platforms are not inferior to those of the US, he said, adding that the SBV has built an effective payment infrastructure and it is working to upgrade this system, Dung noted.

However, the official said, the rapid change of technology makes relevant regulations and institutions become “obsolete”.

"It takes us a few years to build a decree, while technology is constantly developing, even there is a new type after two or three months," Dung said.

For example, P2P Lending (peer-to-peer lending) exists but there is no regulations to adjust this.

Therefore, it is necessary to pilot, develop and learn experience from the practice to build relevant legal systems, Dung said.

Nguyen Chien Thang, Director of BIDV Digital Bank, said that in order to achieve successes, the bank has made preparations since 2014 by setting up a research team to apply banking on mobile devices, and learn about models of foreign banks which have had developed digital banking systems.

In its banking development strategy until 2025 with a vision to 2030, BIDV identifies technology and digital banking as one of the three pillars in its main development strategy.

Amid the COVID-19 pandemic, the bank’s smart banking services have witnessed significant growth. In which, customers can use up to 1,300 types of payment transactions, accounting for 85 percent of BIDV's total transactions on electronic payment channels, handling an average of 15.5 million transactions per month with a total value of 11,000 billion VND. BIDV has also integrated VinID with the "online shopping" application to increase utilities for customers.

Customers have got used to online shopping. 

More efforts needed to change consumption habits

While analyzing difficulties that face development of electronic payments,  Dr. Nguyen Tri Hieu, a financial and banking expert, said Vietnam needs to “run” faster to keep up with the digital banking development trend around the world.

He said currently as many as 40 percent of the population do not have bank accounts, so to call on customers to use the national payment system, it is necessary to stimulate them to use electronic wallets.

Meanwhile, Dung said his agency had to develop regulations on opening accounts by electronic confirmation, facilitating customers’ account creation.

He also underlined the necessity to enhance connection among ecosystems, saying that this can help customers use many services on digital banking platforms.

Banks have considered digital banking as a business strategy, not just an IT project.

However, Dung said the biggest barrier is habits, so it still needs a great push to change habits of customers.

Attention should be paid to increasing the quality of services, and providing simple instructions on installation and use of mobile banking services, thus changing users’ habits, he noted./.