Deputy PM Le Minh Khai gives a speech at the Banking Industry Digital Transformation Day 2023 in Hanoi on May 18.(Photo: VNA) The effort has started bearing fruits as the Southeast Asianeconomy maintained a 40% growth rate in digital payments in the last fouryears, making it one of the world's fastest-growing economies in bankingdigital transformation.
Banks have reported up to 90% of their transactions were handledthrough digital channels with as many as 74.63% of Vietnamese adults having abank account, SBV Governor Nguyen Thi Hong said at the Banking Industry DigitalTransformation Day 2023, held Hanoi on May 18.
In addition, by the end of March this year, 3.71 millionMobile-Money accounts had been opened, with over 70% of them being in rural,remote, and disadvantageous regions across the country.
Speaking at the event, Deputy Prime Minister Le Minh Khai said aspeedy digital transformation must go hand in hand with stronger measures toensure security and trust among the population. He urged the sector to closelycollaborate with government ministries and agencies to minimise the risk ofattacks on digital banking systems.
Transformation
Digital transformation has helped the banks bring down thecost-to-income ratio to as low as 30%, on par with regional and internationalstandards.
In 2022, the interbank electronic payment system processedapproximately 155.2 million transactions with a value exceeding 196.36 trillionVND, a 29.90% increase in value. The financial switching and electronic clearingsystem processed nearly 4.83 billion transactions with a value of about 46.82trillion VND, an increase of 96.63% in volume and 87.30% in value.
By the end of 2022, the total number of ATMs in the countryreached 21,038, and the number of POS terminals reached 410,743, correspondingto a growth of 3.11% and 26.94% respectively compared to 2021. The low increasein ATM numbers could also indicate a positive trend, as people increasinglyprefer non-cash payment methods.
Non-cash payment activities have experienced significant growth.By the end of 2022, 82 credit institutions had implemented internet-basedpayment services, and 51 credit institutions had implemented mobile paymentservices. There are currently 48 intermediary payment organisations licensed bythe SBV providing intermediary payment services in the market.
In comparison to 2021, non-cash payment transactions increased by89.05% in volume and 32% in value. Transactions through internet channelsincreased by 98.54% in volume and 50.24% in value; transactions through mobilephone channels increased by 139.32% in volume and 106.54% in value; QR codetransactions increased by 225.36% in volume and 243.92% in value.
Non-cash payment transactions increased by 53.51% in volume duringthe 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% invalue; transactions through mobile phone channels increased by 65.55% in volumeand 13.31% in value; QR code transactions increased by 160.71% in volume and43.84% in value; POS transactions increased by 37.57% in volume and 32.09% invalue; ATM transactions decreased by 2.37% in volume and 4.02% in value.
The National Public Service Portal has continued to expand itspayment services. By the end of 2022, the portal had served over 4 milliononline payment transactions, totalling more than 3.53 trillion VND. As many as61% of citizens had access to social insurance and unemployment benefitsthrough personal accounts in urban areas.
Legal catch-up
There is still much to do to improve the banking sector's digitaltransformation, however, said industry experts and policymakers.
Pham Anh Tuan, head of the payment department at the SBV, saidmore must be done to help speed up the transformation including enhancinginstitutional frameworks, leveraging population data in banking operations,upgrading infrastructure, prioritising resource allocation, and implementingeffective communication strategies.
Regarding current regulations related to electronic transactions,digital signatures, electronic documents, electronic customer identificationand authentication, data sharing, and customer information security, Tuấn saidchanges should be made to bring them closer to real life and the new economy.
He said there is still a lack of coordination and standardisationof infrastructure, which hinders the efficiency, connectivity and integrationof a digital ecosystem. He stressed the importance of investing in humanresources and infrastructure early for the next phase of development./.
VNA
