A series of banks famous for overseas remittances attraction such as Dong A Joint Stock Commercial Bank (Dong A Bank), Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank), Saigon Thuong Tin Joint Stock Commercial Bank (Sacombank), Vietnam Joint Stock Commercial Bank of Industry and Trade (Vietinbank), etc. are actively implementing promotions and gifts programmes to customers receiving overseas remittances.
Vu Thanh Trung, deputy general director in charge business segment of Dong A Overseas Remittances Company, said that only in October 2018, more than 8,000 transactions were made, up 13.66 percent compared to the same period last year. Trung forecasts that the transaction volume will increase 2-3 times during the Lunar New Year (Tet) since many people transfer money to relatives on Tet.
“Since the beginning of the fourth quarter of 2018, the company has built a plan as well as prepared necessary tasks such as strengthening staffing to ensure that the transactions are always processed smoothly, meeting the needs of customers”, he said.
Besides promotion and gift giving to attract overseas remittances, many companies and banks said that they are actively expanding the market to seek more overseas remittances.
Vietcombank representative said that the bank’s overseas remittance company has built a large dealer network with more than 1,800 banks around the world, cooperating with many partners. From the end of December 2017, the company began receiving remittances from the US and made foreign currency payments to beneficiaries in Vietnam. Currently, the company cooperates and connects with partners from the US, Czech, Japan, Taiwan, South Korea, Malaysia, etc. to pay at counters and transfer throughout Vietnam.
Leaders of Hochiminh City Development Joint Stock Commercial Bank (HDBank) also said that remittances through banks grew quite well in 2018 and mainly from the US and Taiwan (China). The bank has really focused on this segment and actively expanded the market.
Nguyen Hoang Minh, deputy director of the State Bank of Vietnam (SBV), HCM City Branch informed that by the end of December 2018, overseas remittances transferred to HCM City were estimated at more than $5 billion. This figure accounts for about 50 percent of the total remittances sent to Vietnam. This is very remarkable in the context that investment capital flows tend to flow out of emerging economies after the move to increase US dollar interest rates of the Federal Reserve (Fed) and many other economies. Other countries also tend to tighten monetary. That’s not to mention, US dollar interest rates in Vietnam have been decreased to zero for two years.
According to Minh, overseas remittances in 2018 were positive when domestic investment channels recovered, especially the real estate investment channels. Statistics of SBV, HCM City Branch said that the average remittance in the last three years has reached about five billion US dollar per year. In particular, overseas remittances flowing into real estate was accounted for over 21 percent.
Thus, an average of over $1 billion a year flows into real estate. Minh evaluated that this is a great support for businesses and investors, contributing positively to the economic development of HCM City in particular and the country in general.
Last year, the domestic macro-economy was stable and the pressure to increase the exchange rate due to market sentiment was a major reason that recipients of overseas remittances gradually shifted from foreign currencies to holding dong.
As a result, the US dollar/dong exchange rate from the beginning of the year has been quite stable despite the strong fluctuations of the world market. By the end of 16th January, US dollar was quoted by banks at around 23,155-23,245 dong, not changed for many days.
