According to the survey results of the International Data Group in Vietnam (IDG), the rate of non-cash payment transactions in Vietnam in 2023 has increased to 41%, from 28% in 2020. The strong acceleration shows that the financial-banking sector continues to maintain its leading position in the digital transformation of the economy.
Increasing cashless payments
Pham Anh Tuan, Director General of the Payment Department under the State Bank of Vietnam (SBV), said that in the new context of the fourth industrial revolution and the emergence of financial technology - Fintech, digital transformation becomes an indispensable direction, helping the banking industry adapt and overcome challenges.
Implementing the National Digital Transformation Programme, the SBV has issued a Digital Transformation Plan for the banking sector until 2025, with a vision to 2030 (Decision 810/QD- SBV). After nearly two years of implementing Decision 810, the banking sector's digital transformation has recorded remarkable achievements.
According to the announcement from the Ministry of Information and Communications, in 2021, the SBV was ranked first in cyberinformation security, second in institutional construction and fourth in digital transformation. 95% of credit institutions have been developing and implementing a Digital Transformation Strategy at their units.
To keep up with the digitalization flow, Vietnamese commercial banks have invested heavily in new technologies, core banking, API applications, and building an open banking ecosystem. Statistics show that, by the end of 2022, the banking industry will invest more than VND 15,000 billion in digital transformation activities and make Vietnam one of the leading digital banking application countries, with a growth rate of 40% in digital payments, over the past 3-4 years.
Non-cash payment transactions increased by 53.51% in volume during the first three months of 2023, compared to the same period last year. Transactions through internet channels increased by 88.11% in volume and 7.43% in value; transactions through mobile phone channels increased by 65.55% in volume and 13.31% in value; QR code transactions increased by 160.71% in volume and 43.84% in value; POS transactions increased by 37.57% in volume and 32.09% in value; ATM transactions decreased by 2.37% in volume and 4.02% in value.
The results show that the process of bank digital transformation has changed the behaviour of customers using banking services, contributing to accelerating the process of banking digitization, Dr. Nguyen Quoc Hung, General Secretary of the Vietnam Bankers Association commented.
Continuing to improve the institution
However, there is still much to do to improve the banking sector's digital transformation, said industry experts and policymakers.
Pham Anh Tuan, head of the payment department at the SBV, said more must be done to help speed up the transformation, including enhancing institutional frameworks, leveraging population data in banking operations, upgrading infrastructure, prioritising resource allocation, and implementing effective communication strategies.
Regarding current regulations related to electronic transactions, digital signatures, electronic documents, electronic customer identification and authentication, data sharing, and customer information security, Tuan said changes should be made to bring them closer to real life and the new economy.
He said there is still a lack of coordination and standardisation of infrastructure, which hinders the efficiency, connectivity and integration of a digital ecosystem. He stressed the importance of investing in human resources and infrastructure early for the next phase of development.
Many economic experts expressed their expectation, that the upcoming amendments and supplements to the Law on Credit Institutions and the Law on State Bank, will clearly show regulations in line with the progressive trend of science and technology; for the banking industry and Fintech enterprises to continue promoting the diversification of digital services, promoting non-cash payments, strong digital transformation, and bringing convenience to people and businesses, while ensuring the safety and soundness of the whole system, as well as of each credit institution.
