“It’s difficult to do business in the banking sector now. You cannot create a new service and just tell clients to use it,” the retail banking director of a large bank said.

Banks globally are using AI (artificial intelligence) apps in the financial sector, cooperating with BigTechs and Fintechs in providing banking services, and using core-banking transformation, digital assets technology, and blockchain.

In Vietnam, banks’ digitalization process now focuses on digital services such as Internet Banking, Mobile Banking, e-wallet and app launching. 

According to the State Bank of Vietnam’s Payment Department, most banks in Vietnam provide payment services via internet while 41 banks provide mobile payment services.

Big and small banks, foreign and Vietnamese, are digitalizing. Tens of Vietnamese banks have registered to open online accounts. 

Other banks offer specific products. BIDV, for example, has SmartBanking, while TPBank has LiveBank. 

Military Bank approaches individual clients via an official fanpage on Facebook and its own app, and VP Bank has stepped up digitalization with the establishment of a banking Digital Lab.

As for 100 percent foreign owned banks, UOB in mid-2018 launched UOB Mighty which allows users to open bank accounts in a way that saves 80 percent of time in comparison with usual way.

More recently, CIMB has launched OCTO, an app allowing remittances, deposits, card management and payment for bills. 

CIMB’s CEO Tengku Dato- Sri Zafrul Aziz said developing digital banking is a key strategy of the banking group in Southeast Asia, and Vietnam is the first market for it to deploy.

The bank has announced that it would launch an online lending service where clients can ask for loans and get approval via an app, then get disbursement without having to go directly to banks.

CIMB estimates that digital banking will help banks reduce the CIR (cost income ratio) from 50 percent to 20-30 percent.

A recent study conducted by UOB, EY and Dun & Bradstreet found that individual clients and business clients prefer banks with good digital capability.

However, MasterCard Foundation and IFC have pointed out that banks face risks in the areas of legal, technological, operation, fraud and strategy.

LienVietPost Bank chair Nguyen Dinh Thang said the technological risk related to information safety and fraud was the most worrying.

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