50% of banks' lending decisions to be based on technology

A report of IDC conducted under the authorization of Backbase clearly shows two directions of development in the banking industry of Vietnam in the coming time: mobile transactions and tech-based lending activities.

50% of banks' lending decisions to be based on technology
Banks' lending decisions in the future will depend on fintech. (Photo: Hai Dang)



According to this report, mobile transactions in Vietnam are expected to grow by 300% in the period of 2021-2025, with mobile payments playing a leading role. Newly emerging technologies such as artificial intelligence (AI) and machine learning will be applied to enhance the customer experience.

Digital banks across Asia - Pacific (APAC) reached a customer growth rate of three times higher than that of traditional banks in 2020/2019. All banks are actively performing digital transformation, the report says.

It is forecast that in the next four years, the APAC market will welcome about 100 new generation banks, including banks operating entirely on digital platforms. As a result, in each market in the APAC region, current banks will have to face fierce competition from at least two digital banks. It is estimated that up to 30% of business activities of Vietnamese banks are threatened by new digital challenges.

The report says that 60% of banks in the APAC region will leverage artificial intelligence and machine learning to solve database-driven problems, compared to 48% last year. In Vietnam, core banking and modernization of the payment system will be the two main concerns of the top eight banks in order to meet high consumer demand by 2025.

Lending services are expected to develop again. Banks in APAC will focus on digitizing lending activities. This trend is very clear in Vietnam, where up to 80% of banks reinvest in credit risk management and liabilities, while consolidating lending capacity. Lending activity in Vietnam is expected to reach double-digit growth annually starting in 2021.

New potential in this service segment will include the presence of fintech partners. IDC predicts that by mid-2021, 50% of lending decisions in retail banking will be supported by benefits from fintech, emphasizing the acceleration of cooperation between banks and this potential sector.

In the past, lending activities depended entirely on application reviewers at banks. Currently, the explosion of fintech companies makes use of technology to review personal credit scores, creating the basis for lending activities. Banks are also taking advantage of the fintech company's platform to shorten the credit lending process.

Hai Dang

 
Mobile payment: new trend in Vietnam

Mobile payment: new trend in Vietnam

Buyers nowadays only need to scan a QR code by their phones to pay for items, and shops have even stopped accepting cash payments.

Fintechs to partner with telecom carriers to offer Mobile Money

Fintechs to partner with telecom carriers to offer Mobile Money

The pilot program on providing the Mobile Money service is expected to increase non-cash transactions, especially in remote areas. To improve users' experience, fintechs should work with network operators, experts say.

 
 

Other News

.
Wind and solar power: race to exploit endless resources
Wind and solar power: race to exploit endless resources
FEATUREicon  08/10/2021 

In the Draft Power Development Planning 8, one of the power source scenarios with the highest scores is the development of power sources associated with renewable energy under Resolution 55 of the Politburo.

Military Bank named among ‘Best Companies to Work for in Asia 2021’
Military Bank named among ‘Best Companies to Work for in Asia 2021’
BUSINESSicon  08/10/2021 

The Military Commercial Joint Stock Bank (MB) on October 8 received the "Best Companies to Work for in Asia 2021" award by HR Asia, a leading HR magazine in Asia.

Vietnam’s steel group in the world’s top 15 for market capitalization
Vietnam’s steel group in the world’s top 15 for market capitalization
BUSINESSicon  08/10/2021 

Hoa Phat Stee Group of billionaire Tran Dinh Long has entered the world's top 15 corporations in terms of market capitalization.

Apparel industry struggles to reach export target this year due to COVID-19
Apparel industry struggles to reach export target this year due to COVID-19
BUSINESSicon  08/10/2021 

The domestic textile and garment industry is likely to not reach its goals in production and business due to the strong impacts of the COVID-19 pandemic, according to the Vietnam Textile and Apparel Association (Vitas).

Economic momentum in 2021 takes a knock
Economic momentum in 2021 takes a knock
BUSINESSicon  08/10/2021 

Prolonged social distancing in many localities have led to lower-than-expected economic growth for the first nine months, but with the accelerated vaccine rollout, the economy is expected to gain growth momentum soon.

Proposal to resume flights from/to major cities from October 10
Proposal to resume flights from/to major cities from October 10
BUSINESSicon  08/10/2021 

The Vietnam Aviation Business Association (VABA) has proposed centrally-run provinces and cities agree on a plan to resume regular commercial passenger flights, especially those from/to Hanoi, Da Nang and HCM City from October 10.

Pig farmers incur losses, pork shortage for Tet holiday possible
Pig farmers incur losses, pork shortage for Tet holiday possible
BUSINESSicon  08/10/2021 

With the current low prices, farmers will take a loss of VND2 million when selling a pig. If the prices keep decreasing, farmers will give up farming, resulting in pork shortage for Tet (lunar New Year) sale season.

Nike Group to expand investment in Binh Duong
Nike Group to expand investment in Binh Duong
BUSINESSicon  07/10/2021 

Sportswear giant Nike Group has affirmed that it will continue to expand production in Binh Duong province, said Nguyen Thanh Toan, Director of the Department of Industry and Trade of the southern industrial hub.

Smartphone market narrows, IoT opens up
Smartphone market narrows, IoT opens up
FEATUREicon  08/10/2021 

When VinSmart announced the withdrawal from the smartphone market, Nguyen Tu Quang, CEO of BKAV Corporation, the manufacturer of BPhone, showed his regret.

VIETNAM BUSINESS NEWS OCTOBER 7
VIETNAM BUSINESS NEWS OCTOBER 7
BUSINESSicon  07/10/2021 

First three wind-power plants put into use in Soc Trang province

USAID funds US$2 million to improve Vietnam’s innovation workforce
USAID funds US$2 million to improve Vietnam’s innovation workforce
BUSINESSicon  07/10/2021 

The two-year USAID-funded project is expected to support the nation’s strategy on the fourth industrial revolution to advance continued economic transformation./.

Vietnamese enterprises need cash to revive
Vietnamese enterprises need cash to revive
FEATUREicon  07/10/2021 

Nguyen Quoc Ky, Chairman of Vietravel, a big tourist company in Vietnam, said that due to the impact of the 4th wave of Covid-19 epidemic, the entire tourism industry of Vietnam has been closed since May 2021.

Business associations unhappy with weekly tests for vaccinated, recovered workers
Business associations unhappy with weekly tests for vaccinated, recovered workers
BUSINESSicon  07/10/2021 

Several business associations in HCM City have called for scrapping a requirement that workers commuting to the city from elsewhere need to undergo a weekly test for COVID-19 regardless of their vaccination or recovery status.

Govt' to consider zero-interest loans for all airlines
Govt' to consider zero-interest loans for all airlines
BUSINESSicon  07/10/2021 

The Vietnam Aviation Business Association asked the Government to consider a proposal to slash 30 per cent off the airlines' income tax for 2020 and the first half of 2021.

Vietnamese businesses to overcome challenges
Vietnamese businesses to overcome challenges
FEATUREicon  07/10/2021 

Ho Chi Minh City and 18 southern provinces are gradually resuming business and production activities after a long time of lockdown. 

90,000 businesses get stuck, others need VND100 trillion
90,000 businesses get stuck, others need VND100 trillion
FEATUREicon  08/10/2021 

Businesses need loans without collateral and a simple procedure which allows them to access bank loans soon or they will die before they get the money.

Incurring big losses, café chains shut down
Incurring big losses, café chains shut down
FEATUREicon  07/10/2021 

The Covid-19 pandemic, with changes in consumers’ habits and requirement on a minimum distance between customers, has dealt a strong blow to the (food and beverage) F&B industry.

Vietnam’s power development plan to boost LNG sector
Vietnam’s power development plan to boost LNG sector
BUSINESSicon  06/10/2021 

The outlook for Vietnam’s emerging liquefied natural gas (LNG) sector remains promising as the country’s need for the product is large to serve its power development plan, according to Fitch Solutions.

Serious worker shortage looms as factories resume operations after prolonged lockdown
Serious worker shortage looms as factories resume operations after prolonged lockdown
BUSINESSicon  06/10/2021 

Companies in HCM City and other industrial hubs like the neighbouring provinces of Binh Duong and Dong Nai are struggling with a labour shortage after the pandemic.

Vietnamese products at risk of trade violation investigations
Vietnamese products at risk of trade violation investigations
BUSINESSicon  06/10/2021 

The Trade Remedies Authority of Vietnam (TRAV) have warned that Vietnamese products are at risking of falling foul of anti-dumping and trade defence investigations. 

 
 
 
Leave your comment on an article

OR QUICK LOGIN