Business Business

06/06/2020 - 11:14

A diversity in banking service

Even with only 24 commercial banks present in the area, Hue is one of Vietnam financial centers fullof competitive banking services.

Credit policies are helping actively the growth of economy

Not counting the various transaction offices of commercial banks and 7 People’s Credit Funds, Hue currently has 24 commercial banks, 1 branch of Vietnam Bank for Social Policies (VBSP), and 1 branch of Vietnam Development Bank (VDB). 

Not only creating a diversity in types of banks, credit institutions are gradually changing themselves towards service diversification in order to reach customers in the context of competition in credit market share. In addition to traditional financial solutions such as loans and capital mobilization, banks are also investing more into technology, diversifying services and promotions to increase competitiveness as well as to expand the market.

There’s already a competition on reducing transaction fees for e-banking services.

Recently, while the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) reduced its online transaction fee from VND 7,700 to 5,000 per transaction, the Vietnam Export-Import Commercial Joint Stock Commercial Bank (Eximbank) implemented the 24/7 instant interbank money transfer transaction for free of charge.

Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank) reduced its fee from VND 12,000 to 10,000 per transaction for its customers.  The reduction of money transfer fee was also applied by the Joint Stock Commercial Bank for Investment and Development (BIDV) from VND 7,000 to 2,000 per transaction. 

The above examples show the fierce competition on online transaction fees among those 4 the commercial banks.

Mr. Dang Xuan Thanh from Hue city shared that there were very few choices for customers before as there were only a few banks, but now the options have expanded.

Credit policies of each bank also have different “flexibility”. The range of banking service products is diverse and each bank has its own strengths so customers have many options.

“If I were a policy beneficiary or a priority customer, I would go to the VBSP or the VDB. If I needed to borrow money to do business, I would choose either Vietcombank, VietinBank, BIDV, or Agribank,” Mr. Thanh said.

In the race of service products, banks are gradually transfering into the digital business model, providing products and services on a digital platform to meet the increasing needs and convenience for their customers.

Aside from the traditional distribution channels, Agribank also promotes digital banking distribution channels, upgrading all ATM, EDC / POS systems to accept chip card payments. Agribank hasinvested in improving their infrastructure system, strongly developing electronic payment methods, Cash by Code at ATMs, QR Code payment service, etc…

Not only commercial banks, even the VBSP recently has implemented credit policies suitable for its customers 

According to Mr.. Van Duc Tho, Deputy Director of the provincial VBSP, the policy credit funds have been invested 100% into the communes, wards and towns in the province in the past time. In particular, the loans are given with priority to the poor, near-poor households that have recently escaped poverty, to communes in ethnic minority areas, to extremely difficult areas, and to remote areas and border areas ...

For households affected by the pandemic, the VBSP will provide loans for the poor and the policy beneficiaries to help them restore their businesses.

The VBSP is currently implementing more than 20 policy credit programs for many subjects, contributing to the successful implementation of national target programs.

According to the representative from the Thua Thien Hue Branch of the State Bank of Vietnam, diversifying financial services satisfied the increasing demands of customers; but, in general, banking activities are still under control to ensure sustainable, safe and effective development. 

As a state manager, this agency demands the banks to push their bank-enterprise connection programs along with the implementing policies with focus on key industries and sectors of the province, at the same time, strengthening and improving the quality of inspection, examining and supervising the money market and banking activities are also required.

As of March 2020, the total mobilized capital of credit institutions in the area reached VND 49,400 billion, up 2.3% compared to the beginning of the year; credit balance reached VND 50,700 billion, up 0.3% compared to the beginning of the year.

Story and photo: HOANG ANH