A screenshot from khoahocnganhang.org.vn, a portal providing information about science and technology in the banking sector. — VNA/VNS Photo

HCM CITY (Biz Hub) — Technology holds the key to banks' development, especially with the country's increasing global integration, a seminar heard in HCM City yesterday.

Nguyen Van Thay, IT head at the State Bank of Viet Nam's HCM City office, said there is intense competition among banks and the appearance of major foreign banks like Citi Bank, HSBC and ANZ with their prestige, experience and modern technology has forced local banks to improve.

Tran Thi Hong Hanh, general secretary of the Viet Nam Banks Association, said the strong growth in technology had resulted in advanced tools that enable banks to develop new products and services, expand distribution, and improve their management and competitiveness.

Commercial banks and financial institutions have increasingly expanded into retail banking, with retail lending accounting for a large proportion of their revenues and profits, she said.

To sustain growth, lenders are looking for cutting-edge technologies to assist them in all aspects of lending, from loan history management and regulatory compliance to servicing and portfolio management, she said.

Thay said the use of technology would help banks process a large number of loan applications quickly, safely and efficiently.

The use of IT in the banking sector could also benefit customers by allowing them to transact business quickly and safety on the internet, he said.

Modern technologies help banks improve their competitiveness and smoothen administrative procedures, he said.

"E-banking is an inevitable development trend now and in the future in the banking sector," he told the seminar organised by the Viet Nam Banks Association, Fintek and Diasoft.

Mobile banking would be a strategic channel while internet banking would retain its important role, he added.

Tran Le Quan, representative of Fintek, a leading investment, consulting and technology transfer firm, said according to the SBV only 20 per cent of Vietnamese people have a bank account, meaning banks could expand their retail banking activities to increase loans and deposits.

In the past banks mainly focused on selling products they had, but now banking products and services are customer-oriented, meaning they sell products that customers need.

Technology has played an important role in this, he said, adding that technology also enables banks to offer a better customer experience, improve productivity and offer fast and paperless services.

An executive from Diasoft, a global provider of financial software solutions, introduced FLEXTERA, a financial solution for front-to-back automation of retail, corporate and universal banking, treasury and capital market operations, and insurance.

IT in banking

A new portal providing information about science and technology in the banking sector is now available online at this link: khoahocnganhang.org.vn.

The State Bank of Viet Nam (SBV) announced the launch of the website, which is run by its Institute for Banking Strategy, during a press conference in Ha Noi yesterday.

This launch formed part of activities organised to celebrate the 65th anniversary of the domestic banking sector, which was established on May 6, 1951. It was also held to celebrate Viet Nam's Science and Technology Day, May 18.

Yesterday, SBV Deputy Governor Nguyen Kim Anh witnessed framework agreements on scientific research and data use being signed between the institute and several commercial banks, including VPBank, Vietcombank, Vietinbank, HDBank and LienVietPostBank.

In a related development, Banking Viet Nam 2016, an annual banking technology conference organised by the SBV and American-based International Data Group (IDG), kickstarts today in Ha Noi.

Conferences and exhibitions held during the two-day event will promote the use of information technology to create new banking services, aiming to enhance the competitiveness of the local banking system in the face of global integration.

Prime Minister Nguyen Xuan Phuc told The Asian Banker Summit 2016 in Ha Noi last week that Viet Nam would speed up the reorganisation of credit institutions and enhance the efficiency of banking operations for a more stable and competitive economy.

Experts said during the summit that technology would be the key to domestic banking development, while the country was becoming more intergrated into the global economy by entering into a variety of free trade agreements. — VNS