With an annual 20-30 percent growth rate, the consumer credit market has become an attractive sector.
According to Viet Securities JSC, the consumer finance market has been growing steadily from VND646 trillion in 2016 to VND1,000 trillion in 2019. The ratio of consumer lending on total outstanding loans in Vietnam is modest, 11.4 percent.
Eighteen finance companies are operating in this field, including six foreign invested.
The lenders have been expanding their networks to obtain bigger pieces of the market. However, instead of opening new sale points in a traditional business model, consumer lenders are developing online sales.
|The lenders have been expanding their networks to obtain bigger pieces of the market. However, instead of opening new sale points in a traditional business model, consumer lenders are developing online sales.|
Easy Credit, a consumer lending brand of EVN Finance, for instance, has begun providing loans without required collateral via Zalo.
With the new service, borrowers have to provide basic personal information, including identity cards, mobile phone numbers, date of birth, the amounts of money they want to buy and lending terms. The system will give advice to borrowers about the loan packages they can access and the interest they would have to pay.
Clients can leave proposals on apps on mobile phones, without having to call Easy Credit or access the lender’s website. Borrowers can receive advice about loans from anywhere and at any time via Zalo.
Prior to that, Easy Credit also began providing customer care service with the support of the Zalo app. It works with Go Bear Vietnam, a technology firm, using Easy Apply to improve customers’ experience in registering for loans.
In the competition to bring the best experiences to customers, Home Credit in late May launched a new version of an app for borrowing cash online with smartphones. With 2-minute operations, users can borrow VND10-20 million and get disbursement within the same day. It takes 10 minutes to follow procedures to borrow VND200 million.
FE Credit has invested millions of dollars to develop automatic lending app which allows customers to get consumer loans via smart devices within several minutes. Snap, the app, is integrated with automatic recognition feature, allowing customers to post images and documents during the process of registering online loans.
The lender also helps analyze customer behavior and recognizes priority customers, thus strengthening long-term relations.
Nguyen Mai Long from Easy Credit said the company wants clients to access the service in the easiest way, especially those in rural areas. With the service via Zalo, Easy Credit will help rural residents more easily register loans from prestigious credit institutions, thus reducing the rate of access to black credit providers who offer loans at exorbitant interest rates.
Lieutenant General Le Dong Phong, Director of the Ho Chi Minh City Department of Policy, speaks to Thanh Niên (Young People) newspaper on his agency’s commitment to tackle ‘black credit’ in the city.
Vietnam currently has 17 consumer finance companies, whose total outstanding loans reached more than US$5 billion by the end of last year.