With active support of technologies, banks are constantly developing and innovating services to attract customers.
Banks’ products and services are increasingly convenient with lower and lower costs. Banks even launch series of promotions each day in various forms. However, it is easy to see that banks are making good profit from service revenue. For example, Commercial Joint Stock Bank for Foreign Trade of Vietnam (Vietcombank) is the leader in the profit race with net income from service activities of nearly 40%.
For the group of private joint stock banks, the growth rate of services may reach more than 50 percent compared to the same period of the previous year, such as Vietnam Prosperity Commercial Joint Stock Bank (VPBank) with 51%. Vietnam International Commercial Joint Stock Bank (VIB) is one of the banks having the highest growth in service revenue, reaching more than 100 percent over the same period of 2018. This shows that banks are increasingly interested in services, and in this fierce competition, customers are the one who benefit the most.
Market information shows that a wave of zero-dong fees is being actively deployed by banks. Many banks are offering free intra money transfer transactions, namely Vietnam Technological and Commercial Joint Stock Bank (Techcombank), Commercial Joint Stock Bank for Industry and Trade of Vietnam (VietinBank), VPBank, HCM City Development Commercial Joint Stock Bank (HDBank), Tien Phong Commercial Joint Stock Bank (TPBank), Saigon Hanoi Commercial Joint Stock Bank (SHB), Southeast Asia Commercial Joint Stock Bank (SeABank), Maritime Commercial Joint Stock Bank (MSB), etc.
Particularly, VIB launched Sapphire and Gold account package which offers all free services in the first three months, including payment account fee, card maintenance fee, ATM withdrawal fee, online money transfer fee, money transfer fee at counters for first time customers joining the package. SeABank is also offering free intrabank and interbank money transfer to customers using SeANet and SeAMobile services.
Lien Viet Post Commercial Joint Stock Bank (LienVietPostBank) and Vi Viet exempt fee of money withdrawal and transfer in the same system, offer free payment services for unility bills, television, Internet and tuition, etc. An Binh Commercial Joint Stock Bank (ABBank) also offers free intrabank money transfer via Online Banking and Mobile Banking, applicable to all transaction value.
Recently, TPBank has announced the exemption of all only money transfer and ATM card withdrawal fees at most ATMs nationwide. In addition, all TPBank customers do not have to pay fees when transferring money online via TPBank eBank, applicable to all recipient accounts in any bank in Vietnam.
According to Dr Nguyen Tri Hieu an economic expert, not only exempting or reducing service fees, banks are also actively diversifying products to meet the new needs of customers. With banks’ linkage with schools, hospitals, suppliers of goods and services, fintech companies, etc. bank cards have been integrated with many different functions and needs such as student cards, employee cards, links to e-wallets, etc. Customers not only use bank cards to withdraw money and make payment, they can also book air-tickets, book restaurants, hotel accommodation, pay online shopping, and register for medical treatment, etc.
Thus, the competition to attract and retain customers has become increasingly fierce. To attract customers through increasing user experience, banks have taken advantage of information technology to diversify their products. TPBank has LiveBank, Vietcombank has Digital Lab, LienVietPostBank develops ViViet, and VietinBank launches new generation corebank. Military Commercial Joint Stock Bank (MB) has built and put into operation ChatBot virtual assistant with 24/7 service on social networks, etc. Banks have also launched different card products with cashback and rewarding incentives.
New payment methods have also been introduced such as contactless payment, QR code scanning or facial verification, etc. Customers do not have to come to bank directly, they may open cards through the online card opening system. Users can easily manage their accounts via internet banking pre-installed on their phone. Via this application, users can manage personal spending, pay bills, recharge phone cards, etc. and many other utilities.
According to Dr Hieu, banks should take advantage of technology to increase revenue from services. Traditional products such as capital mobilisation and lending can also be deployed on e-banking services. Experts also said that banks should pay special attention to VIP customers, because according to Pareto rule 20-80, 20 percent of VIP customers contribute up to 80 percent of the profits of the bank.
However, experts believed that the most important thing to attract customers is not promotions or competitive fees but the service attitude and safety of banks for customers. Banks need to make methodic investment in information technology and security. Along with that, banks themselves must also create a corporate culture to create trust for customers, etc.
