More Vietnamese people to access formal financial services

Thursday, Jan 25, 2018 08:58

Only half of Vietnamese adults have bank accounts. – Photo VNA

The State Bank of Viet Nam (SBV) is drafting the National Financial Inclusion Strategies (NFIS) to increase the ratio of people and firms with access to formal financial services.

According to the SBV, the ratio in Viet Nam has remained low, with only half of Vietnamese adults having bank accounts. The remaining population with no bank accounts is mainly in rural and remote areas. Many of them know nothing about financial services.

The SBV lists some major barriers for people not being able to access and use formal financial services, such as the lack of banking transaction offices in remote areas, high service costs and complicated procedures for opening bank accounts.

SBV Deputy Governor Nguyen Kim Anh said that Viet Nam’s Government and the banking industry had issued many incentive policies to aid the poor, vulnerable people and those in remote areas, as well as micro and small firms; however, these people and firms were still facing challenges in accessing bank services and loans.

According to Anh, NFIS today becomes a global concern, as it is the key to poverty reduction, social inequality removal and creation of opportunities for many people for a brighter future. The NFIS objective is fully in line with Viet Nam’s socio-economic development strategy.

International experience has also shown that countries that have adopted the NFIS have been able to achieve more comprehensive and successful financial goals. There are currently some 35 countries applying the NFIS and some 25 other countries in the process of developing it.

To deal with the shortcomings, Anh said SBV was drafting the NFIS to enable increasing of the ratio of people and firms accessing formal financial services.

The NFIS is defined as access to and use of basic financial products and services including payments, money transfer, savings and insurance, conveniently and appropriately with reasonable costs.

An effective and comprehensive NFIS will provide the foundation, roadmap and direction for Viet Nam to successfully implement reforms, thereby achieving the nation’s comprehensive financial goals.

Under the non-cash payment policy till 2020, Viet Nam also targets to ensure that at least 70 per cent of Vietnamese adults will have bank accounts by 2020.

There will be at least 20 bank branches and transaction offices for every 100,000 adults; some 30,000 ATMs, or 40 for every 100,000 adults; and points of sale (POS) will number 300,000, or be 400 for every 100,000 adults by the year.

Some 15 per cent of bank branches and transaction offices will be in rural areas. Some 35 to 40 per cent of adults in rural areas will have savings accounts and 50 to 60 per cent of small and medium-sized enterprises will have access to credit. – VNS

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