|Mr. Le Anh Dung, Deputy Director in charge of Payment Department, State Bank of Vietnam.
How do you evaluate the digital transformation efforts of credit institutions?
Credit institutions have actively implemented the tasks set out in Decision 810/QD-NHNN promulgating the Plan on Bank Digital Transformation to 2025, with an orientation to 2030.
Therefore, Vietnam also has been positively recognized by international organizations. According to global strategic consulting firm McKinsey, in 2021, Vietnam’s banking industry is assessed to have the fastest digital banking application rate in the region, higher than the average growth rate of the whole region and even higher than the emerging market average.
Can you share more clearly about the goals that the banking industry sets for credit institutions in the plan to digitally transform the banking industry?
In order to implement the guidelines and orientations of the Party and Government, contributing to the implementation of the National Digital Transformation Program according to Decision 749/QD-TTg dated June 3, 2020 of the Prime Minister, the Digital Transformation Plan, the banking industry in Decision No. 810/QD-NHNN has been built and approached in the direction of putting people and customers at the center.
With that in mind, the goal set out in the plan is toward the digital transformation of the banking industry to better serve people and customers, especially in the digital era.
For credit institutions, the overall goal is associated with the task of increasing utility, and customer experience and providing products in the direction of process automation, business optimization, without going into technical issues.
Specific technical techniques such as upgrading information technology systems, data to create initiative and flexibility for credit institutions in the implementation process.
In addition, the plan also sets out a number of specific goals and targets to be achieved related to the provision of professional services at the credit institutions such as at least 50% of operations performed entirely online by 2025 and 70% by 2030; the target of customer transactions on digital channels reaching at least 70% by 2025 and 80% by 2030; indicators on the ratio of disbursement and lending decisions of commercial banks and financial companies for small loans and consumer loans of individual customers are implemented in the direction of digitization, automatically by 2025, at least 50% and by 2030, at least 70%.
To achieve these goals, Decision 810 also sets out specific tasks and solutions for credit institutions. Therefore, credit institutions need to proactively implement digital transformation plans and strategies, stick to specific tasks and solutions set out with the same view throughout “improve the quality of product supply, services, increasing experiences and taking customer needs as a measure of the effectiveness of the digital transformation process”.
What has the State Bank of Vietnam been doing and will do to promote the digital transformation of the banking industry, sir?
Aware of the importance and far-reaching influence of the 4.0 technology revolution on the banking industry, the SBV has urgently researched, developed and perfected mechanisms and policies to facilitate digital transformation such as the project of developing non-cash payment for the 2021-2025 period, the plan for digital transformation of the banking sector to 2025, with a vision to 2030.
The SBV has also issued circulars guiding regulations on electricity identification. eKYC allows people to open accounts and open cards online, without going to the bank.
In terms of infrastructure, the shared infrastructure for digital transformation is being improved: the inter-bank electronic payment system, the financial switching and electronic clearing system operate stably, smoothly and meet the payment needs of the economy; the credit information system allows exploitation by banks via API.
Regarding coordination with ministries and branches to support digital transformation activities of the banking sector, within the framework of Project 06 on developing the application of population data, electronic identification and authentication for national digital transformation, the State Bank and a number of credit institutions are coordinating with the Ministry of Public Security to study options for connecting and exploiting information on the national database of population and citizen identification with chips to serve the identification and authentication of customers. accurately, safely, quickly, and towards cleaning customer data, serving reliable information matching, timely serving management requirements.
In addition, the SBV also closely coordinated with a number of ministries to assume the prime responsibility for, actively research and contribute to the development of a number of important legal documents related to the draft Law on Electronic Transactions, amendments to the draft Government Decree on identification, electronic authentication, personal data protection and network security to avoid obstacles in the implementation process and facilitate the digital transformation of the banking industry.
The State Bank will continue to improve mechanisms, policies and legal frameworks to create favorable conditions for the digital transformation of banks; giving priority to content related to the application of digital technologies such as collecting, exploiting, processing and sharing customer data; electronic transactions; develop and implement a mechanism for controlled testing of financial technology activities in the banking sector; continue to build and perfect the technology infrastructure in service of the supply of digital products; strengthen integration and connection with other ministries, sectors, and fields to provide banking products and services on digital platforms; improve service quality and increase convenience and experience for customers.