Yet to be fully exploited, retail banking in Vietnam is set for a bustling new future, thanks to the entry of foreign players in the banking sector of the country.
According to Nguyen Duc Vinh, Director General of the Technological and Commercial Joint Stock Bank (Techcombank), there have been plenty of demands for retail banking services from most of the Vietnam's 84 million population. Despite this, retail banking services are yet to come of age in Vietnam.This was the news reported by English. Vietnam .Net.
Vietnamese banks suffer from weaknesses and shortcomings with only themselves to blame. Their flaw lies in their failure to offer a comprehensive range of retail banking services due to which the infamous large cash economy of the country continues to exist.
However, there is a growing awareness among domestic banks about the crucial role of developing retail banking services. There have been attempts for heavy investments in the development of retail banking through multiple branches being opened. The banks have also put in considerable money into core banking software and information technology. The changing attitude is mainly due to the pressure from the strategy of foreign banks in focussing on the acquisitions and mergers to capitalize on nationwide branches of local banks and promotion of wholesale and retail banking services.
With Vietnam's official entry into WTO, foreign bank branches from all member countries have secured the right to set up an ATM (Automatic Teller Machine) outside each office. The plastic card service too will cease to remain the exclusive privilege of the local bank sector.
Although local banks have now adopted various retail banking services, not many are willing to cooperate with each other. Apart from commercial banks, even non-banking credit institutions and small financial institutions are providing retail-banking services in Vietnam.
Industry experts are of the belief that the 84 million plus population makes Vietnam a dream market for retail banking. Also, development of the legal framework for retail banking, as well as scientific and technological development, has helped make retail banking convenient and handy for customers.
A research analyst from RNCOS sums it up as Vietnam possesses great potential in its retail market as a fast developing nation. There is a need for adequate support from foreign investors for the retail banking market, which it may soon starts getting to become a global player.
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