5 Key Takeaways From 2021: The Road to Success For Vietnamese Retail Banks

2021 was a tumultuous year as a new variant of COVID-19 emerged, putting everyone in the face of change. At this time, the retail banking industry in Vietnam in particular needs to quickly revive their spirits and prepare for changes in line with the current situation. This is the time for digital to once again assert its importance. In addition, the focus on re-training staff skills and combining them with innovative technology platforms to develop services is also gradually becoming popular. This topic is a look back at the 5 key takeaways of 2021 – what Vietnamese retail banks can do to success in 2022.

Personalizing customer engagement is crucial

Today, the ability of consumers to connect with banks and credit institutions has been much wider. This is a clear demonstration that if they want to succeed, retail banks must be agile to adapt, thereby keeping a close eye on customers.

To be able to personalize customer engagement, retail banks must begin to transition from data-driven reporting and manual analytics to data-driven, analytics and content that is likely to reflect aspects of personalization. In addition, banks also need to simultaneously consolidate both offline and online data to rely on customer actions in real-time to make appropriate choices.

MB Bank is a pioneer in personalizing customer interaction. Source: thoibaonganhang.vn

In Vietnam, Military Commercial Joint Stock Bank (MB Bank) and Viet Capital Commercial Joint Stock Bank (Ban Viet Bank) are two pioneers in personalizing customer interaction and have achieved great success in the first step.

Ban Viet Bank aims to merge online and offline data when using eKYC in both online and over-the-counter form to unify customer information. With eKYC, the bank can easily identify customers electronically, making user information transparent in the information approval process. This helps the bank to grasp the needs of customers with their habits, thereby making appropriate suggestions quickly.

On the side of MB Bank, the bank has taken advantage of AI/ML to personalize customer experience, thereby increasing connectivity and creating touchpoints. MBBank has the handshake with Insider to take advantage of the development of AI and Machine Learning (ML) technologies, aiming to personalize and optimize the customer experience. With rapid changes and in line with the current situation, MB Bank has initially obtained positive results, increased conversion rate and was able to retain more customers than before.

Digital transformation in retail banks is still going on

To continue digital transformation in 2022, retail banks in Vietnam need to invest more heavily. At this time, the benefits that banks can reap from digital transformation will become their own capital, contributing to increased satisfaction within the business.

See how How Vietnamese Banks Keep Up With Digitalization here!

The partnership between TPBank and akaBot has brought positive effects when this bank was honored as “Outstanding Digital Transformation Enterprise in Vietnam”. Source: akaBot

Up to now, Tien Phong Commercial Joint Stock Bank (TPBank) is the name that has achieved many successes in digital transformation.

The bank has cooperated with akaBot – the pioneer provider in Hyperautomation solutions in Vietnam to apply Intelligent Automation. In specific, in 2021, akaBot’s intelligent bots with advanced technologies, including AI, Machine Learning (ML), Deep Learning and Optical Character Recognition (OCR) has gone live to solve more demanding operational problems given from TPBank.

Hyperautomation has become an inevitable trend of the banking industry. Banks & Financial Institutions can also learn more about this technology here.

Cloud management continues to assert its position

According to the World Retail Banking Report, the majority of financial institutions have yet to start implementing the core cloud computing system in 2021. The reasons for this situation include: complexity, security concerns confidentiality, risk, governance and control. In fact, 91% of financial institutions are actively using cloud computing services or planning to deploy in 2022, with only 9% of banking workloads moving to the electronic environment of cloud computing to manage.

In fact, the current traditional banking system has gradually become outdated and inflexible, making it expensive to deploy new solutions or failing to meet the security requirements against risks. At this time, to be able to meet the demand for capacity and speed, banks and financial institutions need to use cloud computing solutions to store data and support application analytics. This solution promises to improve the bank’s understanding of customers while improving efficiency and advanced innovation, making operations faster and reducing security risks.

Übank aims to become the first digital-only bank in Vietnam with the ability to provide a full range of retail banking products. Source: thanhtra.com.vn

It is crucial that in 2022, banks need to start applying cloud computing solutions to stay competitive. In Vietnam, Übank – Vietnam’s digital bank developed and operated by VPBank – is a pioneer in this field.

Übank has joined hands with Backbase, a pioneer in the global interactive banking platform, to be able to use Backbase-as-a-Service (BaaS) cloud management service, aiming to upgrade the bank’s interactive platform. In just one month, the bank added nearly 50 new features, expanding its portfolio of mobile banking utilities and enhancing the customer experience.

Übank is currently supporting customers to save time in account opening as well as approving loan documents with just 3 steps in less than 1 minute.

Meanwhile, with the quick registration feature, customers will be able to open an account in less than 5 minutes, including the full activation of the function of the international debit card (Master Card).

With the support of BaaS, Übank aims to become the first digital-only bank in Vietnam with the ability to provide a full range of retail banking products through the mobile app which has the same name.

Re-skilling and new recruitment has been the focus

Digital transformation continues to thrive in 2021, and expectations around speed, simplification and convenience have transformed back-office processes, increasing demand for real data and applied analytics, putting pressure on the leadership team and employees. Unknowingly, the emergence of new workloads as well as changing old processes to accommodate new technology has made it difficult for employees. At this point, retraining and new recruitment becomes a top priority as the bank begins to transform.

With this situation, retail banks need to re-evaluate the skills of employees in key internal roles. Accepting and adapting to change is everyone’s responsibility, and committing to learning and re-skilling becomes a top priority.

Also read: 3 Applications of Technology in The Digital Transformation of Labor

Digital Hub FTU is the result of the handshake between MBBank and Foreign Trade University (FTU). Source: talentnetwork.vn

In Vietnam, Military Commercial Joint Stock Bank (MB Bank) is the pioneer name in retraining and improving skills for employees by establishing a learning and creativity center, using all the most modern training equipment. Officially put into operation from February 7, 2020, the center is a place that gives employees the opportunity to experience a modern learning space with the Mockbank area (simulated banking exchange), helping to train and create a teller to receive customers, sell and practice on simulation machines in accordance with reality.

Recently, on March 9, 2021, “Digital Hub FTU” developed by MB Bank at Foreign Trade University was also officially put into use with view to nurture talents and build the future digital workforce. The entire space adopts the Agile model – a modern software development model that supports adaptive planning, incremental development, early delivery and continuous improvement. Digital Hub FTU is equipped with advanced technologies, including an ATM machine with a large screen for the presentations of ideas with the design similar to a digital bank.

Outsourcing becomes the new way to success

In 2021, financial institutions and retail banks have begun to change to adapt to the situation, in which, cooperation with third-party fintech suppliers has become a new trend. This offers many ideal benefits, including allowing for testing and speed verification of employment at any process before rolling out to the entire enterprise.

It can be affirmed that outsourcing has become a new trend after 2021 because according to a study by Digital Banking Report. This report shows that 50% of banks find new talent through cooperation with existing and new partners (43%). This makes it possible for the bank to acquire new human resources equipped with the necessary skills at the beginning of the transformation. Banks can take advantage of the innovative technology platform of affiliated Fintech companies to develop their services and products through outsourcing some services, rather than self-development with invested costs.

In Vietnam, Vietnam International Commercial Joint Stock Bank (VIB) is a pioneer in outsourcing. VIB has cooperated with Weezi – a fintech company – to launch myVIB Keyboard application with the ability to transfer money via social networks. Meanwhile, Vietnam Technological And Commercial Joint Stock Bank (Techcombank) has collaborated with Fintech Fastacash to launch [email protected] Mobile – a method of quick money transfer via Facebook and Google+.

The cooperation with Fintech companies is a cost-efficient solution for retail banks. Source: innotech-vn.com

The impact of the COVID-19 pandemic in 2021 has contributed to many important shifts of retail banks in Vietnam. At this time, financial institutions and retail banks need to embark on digital transformation to adapt to reality and open new doors to success.

To get updated on the current banking tech trends, discover more lessons and success stories, please visit here.

References:

TPBank là Doanh nghiệp chuyển đổi số xuất sắc tại Việt Nam

9 Retail Banking Reflections and Keys to Success for 2022

TPBank đặt mục tiêu trở thành 1 trong 5 ngân hàng bán lẻ hàng đầu Việt Nam

“Bùng nổ” mở tài khoản trực tuyến

MBBank bắt tay với Insider, tiên phong trong cuộc đua chuyển dịch số

Übank trở thành ngân hàng số đầu tiên chuyển đổi với dịch vụ quản lý đám mây

MB khai trương trung tâm học tập và sáng tạo hiện đại bậc nhất

akaBot (FPT Software) is the operation optimization solution for enterprises based on RPA (Robotic Process Automation) platform combined with Process Mining, OCR, Intelligent Document Processing, Machine Learning, Conversational AI, etc. Serving clients in 13+ countries, across 08 domains such as Banking & Finances, Retails, IT Services, Manufacturing, Logistics…, akaBot is featured by Gartner Peer Insights, G2… and ranked as Top 6 Global RPA Platform by Software Reviews. akaBot also won the prestigious Stevie Award, The Asian Banker Award 2021, etc.

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