The strong development of digital technology is forcing banks as well as policy makers to make changes. This is also the general trend of the world, not only in Vietnam. International and domestic experts in the field of Financial Services Consulting from PricewaterhouseCoopers (PwC) share about this trend.
Accordig to John GarveyGlobal Leader in PwC’s Financial Services Consulting, the banking trends in Vietnam are not too different from the global.
The trend that banks around the world are following to achieve customer-centric goals is, firstly, less emphasis on products. In the past, most traditional banks built quite independent products such as credit cards, personal loans, and mortgages. And each product had its own support system, its own management and reported its own business results. But now banks are aiming at customer lifetime value model and adjusting their management structure based on this model.
Secondly, banks tend to place all forms of distribution channels under common control. In the past, different parties managed each distribution channel (transactions at branches, over the phone, mobile devices, etc.) Now, many banks are putting all of the distribution channels under a single management.
Thirdly, banks are complying with regulations towards better behaviours. Regulatory agencies in many countries are promoting fairness and transparency in lending, complaints and investment advice. All these changes require better control, culture and business model changes.
Finally, digitisation focuses on the customer experience. Much of technology expenses have focused on improving the customer experience. Integrating fintech or making use of social networks has been enhancing the customer experience, increasing the ease of use and the ability to solve problems.
Meanwhile, Grant Dennisgeneral director of PwC Vietnam Consulting Company said that banks need to understand the lifestyle of each customer.
Trends in Vietnam are quite similar to world trends. It can be seen that banks are following the trend of digitisation, applying new technology to change their activities towards customer-centred, providing faster and better services.
In the future, banks need to understand the lifestyle of each customer and understand their needs and ambitions. For example, customers may plan to buy a car, an apartment or get married. The bank must be a party to assist the customer in achieving those personal goals through services such as savings, loans, life insurance or third party products such as health insurance.
Most importantly, banks need to understand customers’ needs and offer corresponding services even before customers are aware of what they want or express that desire. Banks can gain insights about customers thanks to proactive data analysis. They can apply smart data analysis technologies; collaborate with fintech companies or other solution providers to do this.
Vo Tan Longdeputy general director of IT Consulting Services, PwC Vietnam Consulting Company believed that Fintech is a great motivation to expand and universalise financial services.
The fact is that State management agencies, especially the State Bank of Vietnam (SBV), are very interested in the development of fintech companies. SBV has established a steering committee on fintech with the participation of many senior leaders in the industry.
SBV recognises that fintech is one of the major drivers for expanding and universalising financial services in Vietnam, in order to achieve the goal of a cashless society. Therefore, SBV is very active in promoting policies so that fintech companies can develop more. Specifically, SBV is currently drafting a proposal to the prime minister on agent banking and identifying customers through electronic means (e-KYC). These two regulations, if approved, will open a new playground for fintech companies to directly provide financial services to a large number of people in Vietnam.
In addition, financial safety and security are also a concern for fintech companies. Therefore, SBV is putting great efforts in making policies related to management of information security and safety. Thereby, there is a balance among opening up, supporting fintech development, and ensuring the safety and privacy of financial information on cyberspace and digital space.
Fintech is required to have certain partnerships with banks in the field of providing financial services, supporting the improvement of information safety and security for customers.
Dinh Hong Hanhdeputy general director of Financial Services Consulting, PwC Vietnam Consulting Company said that personnel must be switched to be suitable for the digital age.
In addition, as in the world, Vietnamese banks are following the trend of personnel transformation to be suitable for the digital age. Many of them are developing rapidly in digital technology.
However, their employees’s scale and operating models may not be as efficient as shareholders and bank leaders expect. The issue of labour productivity has become a great concern of many Vietnamese banks. The question is, how effective that productivity is, how it is motivated and adapted in the context of digital automation and technology. PwC found that many banks, which were pioneers in technology, would now be more concerned with efficiency and productivity.
