From the past few years, digital banks are considered a new direction to help banks diversify non-interest revenue and individual deposit growth.
This is also regarded as an indispensable development path of banks, if they do not want to be left behind in the era of technological development.
However, some people do not fully understand what exactly digital banking is and how it brings about opportunities and challenges.
At the seminar “Digital Bank promotes the development of specific ecosystems” recently organised by BizLIVE, Tran Hoai Nam, director of Tien Phong Commercial Joint Stock Bank (TPBank), said that “Digital Bank” was a very broad definition, each bank, even each person has their own definitions.
“For us, digital banking are not Internet banking or Online banking, not banking technology, or alternative channels.
For us, digital banking is a banking business model, consisting of four pillars including new products, selling methods, access channels, operational, customer service and risk control mechanisms. All are supported by new technology platforms, “Thang said.
According to Thang, as one of the leading banks in the digital banking sector, TPBank has made a serious strategic investment not only in mobile banking and Internet banking products but also with scattered but effective investments in all the pillars to make a real digital bank.
In particular, TPBank is the first bank in Vietnam to operate the LiveBank model, the 24/7 bank in 2016. And this really brought a difference to this bank.
Accordingly, LiveBank not only performs all functions of an ATM but also integrates other functions such as savings, account opening and debit card issuance.
Previously, if customers wanted to open a bank account and receive an ATM card, the time between registration and card acceptance must be calculated by week. But with LiveBank, within five minutes customers could do it thanks to the combination of OCR technology, biometric identification and open API with external databases.
Thanks to its convenience, safety and security, TPBank’s LiveBank service developed rapidly after just three months, this service attracted 10,000 customers to successfully open ATM cards.
Accordingly, LiveBank has helped the bank expand its network and gain market share quickly thanks to lower investment costs than traditional branches.
Nam said, LiveBank had transaction costs equal to half of the costs at the counter, operating costs are only one fifth of the counter expenses, the transfer costs are one fourth of that at the counter.
As a result, LiveBank has a rapid growth rate, 50 times higher than that of the branch, expected to reach 300 points by 2020.
Another product of TPBank also receives great attention from customers is Savy Savings App.
Based on the leading modern technology platform, this is the first savings application in Vietnam that allows savings from all banks completely free with only 30 thousand dong.
Nam said that in just six months, this application had attracted 350 thousand customers, 100 times higher than the branch and helped the bank mobilise 150 billion dong per month, six times more than the normal branch.
In addition, a range of other technological applications also contributes greatly to reduce processing time and increase productivity for the bank.
Chatbot application can help decrease up to 30 percent of the workload for Call Centre, Voice Bio reduces call processing time by 15 percent and OCR application saves up to 90 percent of data inputting time.
According to TPBank’s leadership, up to now, over two-thirds of the bank’s transactions have been made online, thereby reducing a large amount of personnel costs, management costs and maximising time and costs savings for customers.
In particular, thanks to good implementation of digital technology projects, TPBank is considered as one of the joint stock commercial banks with the best retail network in the system, although the number of branches is still quite modest.
TPBank has also become one of the most prominent commercial banks in Vietnam in recent years, with strong profit growth and effective operation in the system. One of the main impetuses for this result, as above, is the rapid and strong strategy of digital banking.
