A huge percentage of banking transactions are now carried out on digital platforms, photo Le Toan

Through the digital bank Cake by VPBank, an app designed by cloud banking platform Mambu has been embedded in the Be ride-hailing app, aiming to attract Be’s customers and drivers to use digital banking services. After constantly updating the core technology, Cake has now attracted three million customers to date – a dream number for many banks.

“This shows that retail in the new generation of core technology will bring new efficiency to banks, after a long time of being inferior to the wholesale market,” said Mambu general director Pham Quang Minh.

According to Minh, in 2023, the market demand is not different from 2022, that is, people will lose their jobs, and incomes decreases, leading to a decrease in spending, so banks must focus more on stimulating demand.

“Insufficient money to spend and save will be an opportunity to develop the buy now, pay later segment. In addition, the self-employed customer group has emerged as a new potential segment, but has not yet had access to credit products, which is an opportunity for banks to exploit and increase market share,” Minh added.

However, in order for customers to want to use their services, banks need to have a friendly and convenient interface. “This depends on the digital transformation strategy to create a defined focus for each area. And it’s important to find a partner who understands what’s going on and is constantly looking for the best and latest solutions from around the world,” Minh said.

He explained that Mambu does not want to bring products that customers do not understand. It will carefully consider, adjust, then introduce and advise customers on products suitable to the needs of Vietnamese people, along with designing diversified products to serve the needs of the market.

“To be able to do these things, we only need a few weeks, not months or years, to help banks transform digitally, as we did with Cake,” he added. “At the same time, Mambu is also ready to train the bank’s technology staff to accompany the digital transformation process.”

Elsewhere, VIB is currently the market leading retail bank in the country, with the sector making up nearly 90 per cent of its credit portfolio, compared to the industry average of 40 per cent.

A representative of the bank said that the driving force for VIB’s business results came from all three core segments of retail banking, corporate banking, and capital resources/foreign exchange. But retail is considered the strongest strategic and investment focus, he said.

“The outstanding development of digital banking is one of our biggest achievements in the past five years, with 97 per cent of VIB customers’ transactions being carried out on digital platforms,” the representative added.

Economist Nguyen Tri Hieu said that in many Vietnamese banks that there is a certain deviation in business, sometimes pushing too hard into the retail segment, and sometimes too strong into the wholesale segment, leading to an imbalance in operations. They must take advantage of technology in order to avoid this.

“This leads to a situation where things are okay when the market is favourable for a certain segment, but when it is disadvantageous, banks immediately stumble. Business segments need to be balanced and in the 4.0 era, banks now have choices of technology support,” Hieu said.

A tech representative at another Vietnamese joint-stock commercial bank said the cost of technology investment is always considerable, but what helps reduce the cost is that banks with fast conversion speed consume fewer resources. “This is an issue that everyone in the tech sector understands, but conveying this message to other leaders as well as the banks’ owners is not easy,” he said.