The participation of telecommunications companies in the electronic payment (e-payment) market, not via bank accounts (Mobile money), will solve the non-cash payment problem for all people. However, this poses challenges for banks.
At the meeting in March 2019, the government assigned the Ministry of Information and Communications to coordinate with the State Bank of Vietnam (SBV) to study and develop a plan that telecom networks could provide e-payment services not through bank accounts (Mobile money).
According to the assessment, allowing mobile telecommunication accounts to pay for goods would solve non-cash payment problems for all people. However, this posed challenges for banks.
Judging by the competitive pressure, Phung Nguyen Hai Yen, deputy general director of Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank), said that the trend of telecommunications companies participating was inevitable trend. With an extensive information network and complete customer information of telecommunications companies, they could fully provide financial services, especially comprehensive finance to people.
“Our bank realise that we have to go together, we want to develop together. The bank has expanded many links, along with telecom companies to provide the best financing for people, including simple payments such as electricity, water, and more complicated payments like financial investment. Telecom firms have the advantage of being a full customer information base, which is the basis for exploitation”, Yen said.
Tran Thu Huong, director of Retail Division, Strategic director of Vietnam International Commercial Joint Stock Bank (VIB) said that although the telecom companies participated, the bank still had separate advantages.
“The bank has two biggest advantages, which is the bank’s facilities in reaching customers, providing complete services. Very few other companies can have it.
The second strong point is the trust of the people. Banks have a reputation for people to come to pay and do other services in daily life. The loyalty of consumers remains firm for banks to be confident to invest in the newest technology in order to increase the convenience for the people”, Tran Thu Huong analysed.
On the other hand, she also said that telecom companies had advantage of technology. They had good data sets. Besides, they were not bound by many policies like banks.
For example, customers would have to come to the bank office to verify customer information People could not do online to secure information. The banking system had a strict process.
However, Tran Thu Huong affirmed that the bank was still maintaining a good advantage of integrated products and technologies to deliver a comprehensive product package to customers.
Previously, the bank had access to telecommunications companies at a very basic level, working together to exploit their data. However, when both parties had services to manage cash flow, there would be many opportunities for telecom companies to take advantage. Banks could take advantage of new technologies and data of telecom companies. This cooperation was beneficial to the economy.
The bank thought that more and more suppliers brought a better experience to customers. The more competitive, the more perfect the bank.
Talking about bank’s difficulties when approaching customers, Tran Quoc Anh, Head of Individual Banking Division of HCM City Development Joint Stock Commercial Bank (HDBank), said that according to SBV’s regulations, most customers who wanted to open an account must go to the bank office to verify the information. However, commercial bank headquarters were often not fully located in all povinces.
“As a rule, in each province, each bank had only one branch and three transaction offices. While there were large areas, with many districts, moving to authenticate was difficult. Therefore SBV should probably stipulate more about the authentication method to ensure no fraud. For example, for identity card authentication system, banks could find intermediary partners, where there was no bank.
For customers who already had transactions at a certain bank, they wanted to open another bank account, SBV could allow to do online. The source of customers’ money to the new account might be required to come from the old account. I think it is authentic, it is impossible to cheat”, Tran Quoc Anh suggested.
