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What Came Before Virtual Vietnam?

nVietnam is undergoing rapid economic development. Propelling this progress is the expanding banking sector, dominated by disruptors who are bringing about a transformation with digital banking capabilities.nnBy going digital, banks are tapping into underserved segments, increasing retail banking activity, growing card-use for transactions, and attracting new demographics like tech-savvy youth. This is the pathway for banks to advance financial inclusion through innovative channels while strengthening their consumer business.nnNot only that, due to Vietnam’s rapid digital technology adoption, by 2023, domestic banks will have already achieved 90% digital transactions, exceeding the 70% target initially set for 2025. The Vietnamese government is driving this digital shift, with Prime Minister Pham Minh Chinh urging banks to modernise and diversify their services.nnThe banking industry’s pivotal role in the country’s national digital transition is commendable and internationally appreciated. Banks have introduced digital products and services for both consumers and businesses. According to targets, half of Vietnam’s banking services will be digital and 70% of transactions will be processed online by 2025.n

Exploring the Digital Dong

nThe numbers talk for themselves!nnVietnam is witnessing history happen! With its financial technology market expected to grow to US$ 18 billion by 2024, they are finally drawing significant attention from the world. And this time, it’s not just for their flavoursome food or attractive tourist destinations.nnA new study by United Overseas Bank (UOB) reveals the accelerating digital banking trends in Vietnam. According to the report, Vietnamese consumers are progressively shifting towards digital banking and modern payment solutions such as mobile banking apps, e-wallets, QR code-based payments, e-commerce payment gateways, and digitally integrated debit and credit cards, prioritising convenience and speed.nnThe analysis reveals that ease-of-use and real-time transactions drive more Vietnamese to embrace tech-enabled banking services over traditional options. This preference underscores the mounting adoption of digital finance across Vietnam.

While Vietnamese consumers are rapidly adopting digital banking services, the UOB study indicates that they still rely on offline, in-person channels for high-value or complex financial transactions. For instance, consumers prefer to visit physical branches and speak with advisors when restructuring bank loans or purchasing insurance plans.nnThis reveals a trust gap between digital and human-led services, especially when large sums of money or significant financial decisions are involved. Even digitally-savvy Vietnamese consumers seek the reassurance and customised guidance provided through face-to-face advisory.n

What can Vietnamese banks do to bridge this trust gap?

nThe Way ForwardnnThe e-payment revolution is dramatically reshaping Vietnam’s banking landscape. As digital payments become ubiquitous, the future of banking in Vietnam will rely on the following:nn1. Bridging The Trust Gapn

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• Banks must prioritise cybersecurity, privacy protection, and transparency to build confidence in digital services. Implementing blockchain, biometric authentication, AI fraud monitoring, and data encryption can help achieve this.

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• Providing human/AI hybrid advisory for complex products or large transactions is key. This blends personalised service with digital convenience. Video conferencing, robo-advisors, and omnichannel integration will bridge the human-digital divide.

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• Comprehensive consumer education on digital finance through online portals, apps, and in-branch training will further boost engagement and trust.

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n2. Expanding Digital Offeringsn

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• Banks will move beyond payments to offer integrated digital ecosystems – lending, investments, insurance, wealth management, etc. Hyper-personalisation, predictive analytics, digital wallets, and automated services will be the talk of the town!

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• Partnerships with digital solutions providers will allow innovative embedded finance services. Banks can learn how to offer seamless customer experiences that will be accessible anytime, anywhere.

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• Using AI, cloud computing, and open banking APIs will enable banks to create new digital revenue streams and optimise back-end processes.

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Clayfin’s role in advancing a cashless utopia in Vietnam:

nIf you’re a Vietnamese bank, the ball is now in your court. How do you help advance the digital transformation? Here’s how Clayfin can help.nnAs a leading provider of digital banking solutions, Clayfin empowers banks to meet these changing demands while fulfilling their core mission: serving customers.nnOur solutions allow banks to offer tailored experiences that resonate with each individual. We help shift tedious transactions into engaging, customised digital journeys.nnBeyond adopting new technology, our partnership enables banks to refocus on strategic goals and customer relationships. We shoulder the responsibility of digital innovation so you can focus on what matters most.nnWith Clayfin, banks can confidently navigate the complexities of the digital age on their terms. Our solutions liberate banks to honour their values while delivering the services customers expect in the modern era.nnWe guide banks across the digital divide, transforming operations without losing sight of their purpose. With Clayfin’s partnership, banks can embrace the future with customer-centric digital banking.nnThe future belongs to those who shape it proactively. Together, we can lead your bank into this exciting new frontier. Get in touch with us today!