On September 8, 2021, the Cooperative Bank of Vietnam (CBV) held an online meeting to kick off the “Consulting project on building a digital and IT strategy for CBV in the 2021-2025 period, vision to 2030”. This is a subproject within the IT component of the project “Strengthening the People’s Credit Fund network” (STEP) funded by the Department of Global Affairs Canada (GAC), the Desjardins International Development Organization (DID) and the Co-operative Bank of Vietnam. STEP project held the tender and selected the consulting company MCG to implement this project.
Attendees of the meeting including Mr. Nguyen Quoc Cuong – Chairman of the CBV BOD, Mr. Nguyen Minh Tuan – Deputy CEO, along with CBV’s Heads of departments, units and centers at CBV HO as well as CMG consultants.
Opening the meeting, Mr. Nguyen Quoc Cuong – Chairman of the CBV BOD raised the importance of digital transformation and IT at CBV. He said that according to the project of the Prime Minister and Decision 810 of the Governor of the State Bank of Vietnam, the digital transformation in the banking and finance industry is mandatory and is a fierce race among financial institutions, especially in the current period. During the Covid 19 pandemic, there are many complicated developments that make electronic transactions more and more preferred. He said that the digital transformation is becoming more urgent than ever, and the banks will focus their resources on converting to modern technology.
At the meeting, MCG’s consultants shared digital transformation trends in the banking sector and digital transformation experiences at some banks in Vietnam. The consultant said that the definition of a digital bank is that all banking activities go through the digital environment according to the model of 3 1 0: 3 minutes to complete the profile, 1 second to analyze and approve, and 0 (zero) human participation. Digital transformation should be divided into three major areas: internal transformation, business model transformation and corporate culture transformation. These are three closely related areas; Accordingly, digital transformation means converting all three fields at the same time. According to these experts, there are 10 digital transformation trends, including: (1) Changing business models, (2) Changing the competitive methods of products and services, (3) Reducing the cost of products and services, (4) Developing distribution channels of banking products and services through smart devices, (5) Biometric application in transaction approval and authentication, (6) Application of sharing economy model for the service infrastructure, (7) More customized products and services to customer needs, (8) Smarter services, (9) Reshaped service architecture, (10) Technology transfer and Knowledge.
Also in the meeting, the consultants presented the Fintech market picture. From 2015 up to now, the financial market has witnessed remarkable development of many small Fintech companies, directly competing with a number of banking activities. The trend of non-cash transactions in the past 5 years has increased to more than 100%, prompting banks to deploy a lot of convenient apps for customers. The market is following the trend of real-time payment and digital financial channels and banks are no exception. Experts say that there are three main reasons for digital transformation at CBV including: (1) at the request of the government and the SBV, (2) at the request of the market, and (3) actual needs of the bank
Regarding issues that need to be considered when building and implementing digital transformation and IT based on the experience of banks and Fintech companies in Vietnam, the consultants shared the importance of changing mindset – which is very important but frequently not noticed. Experts say that the financial industry is risky, so processes must be cautious, digital transformation must be associated with an open mind to keep up with the advancement of technology. In addition, the business departments are often allocated separately, working sequentially according to set process, but during the transformation period, they will have to work simultaneously with continuously change and updates. Regarding digital infrastructure architecture, experts emphasized that governance policies and technology solutions must go hand in hand and cannot be separated. Currently, banks are focusing on data records as a living mechanism instead of data warehouse as a static mechanism as before. Therefore, the supporting bank will need to develop an appropriate data management policy to ensure information safety and security.
Updating the next step in the project implementation plan, Ms. Ngo Minh Anh – Director of MCG said that the project has now gone through the start-up stage and has worked with relevant departments to understand the current situation and the bank’s aspirations in digital transformation. In the next step, the project will update the data, continue to coordinate with the departments and do more in-depth research on the collected data. It is expected that the diagnostic report will be completed in the fourth quarter of 2021.
Speaking at the closing of the meeting, Mr. Nguyen Quoc Cuong – Chairman of the CBV BOD once again emphasized the importance of digital transformation in supporting the bank to perform its role as a focal point for the safe, efficient and sustainable development of the PCF network. Mr. Cuong affirmed the commitment of the Bank’s Board of Directors to create all conditions and prioritize resources for implementing digital transformation quickly and effectively.

(Source: CoopBank website – www.co-opbank.vn)