digital bank transformation strategy of …

DIGITAL BANK TRANSFORMATION STRATEGY

OF LIENVIETPOSTBANK

M r. D u o n g Tr o n g C h u – D i r e c t o r o f D i g i t a l B a n k D i v i s i o n

INCLUSIVE FINANCE IN VIETNAM

DIGITAL BANK TRANSFORMATION ROADMAP

I.

II.

III. LIENVIETPOSTBANK OVERVIEW

IV. DIGITAL BANK TRANSFORMATION STRATEGY

V. VI VIET and LIENVIET24H


95.5

Key Index14.5%

Adult with Savings Account

21.7%Adult with Loans

Account

40.8%SME’s approach with

Loans

25.2%Adult with Bank

Account at Rural Areas

68%Smartphone penetration



I.

II.





• To develop an ecosystem, expand the operation network, diversify cross-selling services, improve utilities to maximize benefits for customers

• To enhance customers’ experience, focusing on personalize users’ experience on a unified platform

• To improve the consistency, focus on customer interaction and experience

• Electronic banking platform including Internet Banking and Mobile Banking

Digital Bank 1.0

multi -channel

Digital Bank 2.0

omni -channel

Digital Bank 3.0 Banking without a

bank

Digital Bank 4.0

Banking as Experience

CHALLENGES

Legal framework: less support from legal framework, there are many limitations in regulations on the

followings:

• Agent banking

• eKYC process, e-signature in banking transaction

• Bank can not provide online lending

Risk management, including:

(1) Strategy risks;

(2) Legal risks;

(3) Technology risks;

(4) Operation risks;

(5) Finance risks;

(6) Fraud risks

Customers habit: more than 70% of payment transactions in Vietnam still prefer cash payment, Vietnamese are

not used with and don’t really trust on online transactions

Big investment and deployment resources requirement



I.

II.




LIENVIETPOSTBANK OVERVIEW

Established on March 28th 2008

Mission

To provide customers and society a wide range of high quality products &

services. To bring the highest benefits to LienVietPostBank and society

Network

Nearly 500 Bank-owned Branches/Transaction Offices; 1,000 PTOs in

63 cities and provinces nationwide

Number of customers: over 4.5 million customers

Future expansion (by 31/12/2020)

To be present in every district of Vietnam with over 800 bank-owned

branches and transaction offices. To develop 50,000 merchants and

transaction points across every commune nationwide

Vision

To become the leading retail bank in Vietnam – a Bank for everyone

KEY FINANCIAL FIGURES

6.402

7.288 7.671

8.191

376 419 447 512

5.009

6.045

7.011

5.608

3.595

4.598

5.340 5.571

-

1.000

2.000

3.000

4.000

5.000

6.000

7.000

8.000

9.000

2016 2017 2018 Jun-19

Total Assets Owner's Equity Total deposits Total outstanding loans

13th

Total

Assets

13th

Total Outstanding

Loans

11th

Total

Deposits

2nd largestNetwork

Unit: million USD

Key financial figures

(from 2016 to June 2019)

Competitive Landscape

(as of June 30th 2019)



I.

II.




11

DIGITAL BANK TRANSFORMATION STRATEGY

Develop omni-channel transaction plaform integrating all channels, to apply modern technology to

control risks, increase safety and security in transactions, as well as maximize benefits for

customer and enhance customers exepirence

• Corebanking upgrade

• Apply new technologies including cloud computing, AI, tokenization, blockchain, API (Application

Programming Interface), Machine learning, Chatbot in developing digital bank platform

Connect more partners to develop the ecosystem, diversify banking products and services

Expand the market, scope of service providing to other countries (South Korea, Japan, China, and

globally)



I.

II.




Vi Viet, the first version of digital bank application of

LienVietPostBank, was officially launched in September 2016.

Technology platform serves the Bank’s retail strategy, aiming at all

classes, especially 70% of Vietnam’s population without bank account.

TỔNG QUAN VÍ VIỆT

Multi-layer authentication system (password;

OTP; device authentication; biometric

authentication (fingerprint, faceID, iris; public

key security, etc)

Advised and verified by many leading

security partners

S A F E T Y

Non-physical prepaid card operates as digital bank and online

payment gateway, cashless payment method for all transactions & e-

commerce.

Smartphone application – Easily register and utilize with devices;

abundant ecosystem

Fast payment for more than 200 services (utility bills, tuition fee,

online shopping, etc)

24/7 online banking services

C O N V E N I E N C E

Using without bank accounts

Full support for

payment and

digital banking

services

RICH FUNCTION SET

ADVANCE

support

platform for

partners

24/7 ONLINE BANKING SERVICES

Online savings, deposits-sercured loans, banking statement inquiry

Cash in/out, money transfer: betweens Vi Viet accounts, Vi Viet

accounts – domestic banks account, cash in at banking counters of

all banks in Vietnam

PAYMENT SERVICES

PAYMENT FOR

MORE THAN 200 SERVICES

QR code payment, bill/

public service payment,

mobile top-up, online

shopping and entertainment

UTILITIES

Payment assignation, debt notification, Gift giving Voting, etc

Personalized functionality; product and service suggestion by

location and map

MERCHANT SUPPORT

Sales management, marketing, revenew management, nearby function

PAYMENT PLATFORM

Payment gateway, App to App SDK, App in App SDK, connected platform which allows partners to integrate

payment services into their services

FOR ALL SEGMENT, BOTH

BANK AND UNBANK USERSCARD SERVICEPayment from virtual card, card information inquiry, new card opening, Card statement, card opening/close

VI VIET INTERFACE

SECURITY DESIGN

MODERN TECHNOLOGY

Security method

with HTTPS

Transmission line

security with SSL

Certified by

GLOBAL SIGN

Use public lock

infrastructure

Identify user with

digital signature

Identify user with

digital signature

Sign up with user

or password

OTP code

authentication

Device

authentication

Authentication

request sent to

original device in

case user uses

different device

Transmission

line security

Data encrypt & transaction

authentication

Multi-layer

authentication

Device identification

and limitation

VI VIET PERFORMANCE (From Sep 2016 to Sep 2019)

USD 2.3 billion

Remittance value

USD 136 million USD 480 million USD 68 million

Online lending Bill paymentOnline savings

21 million

No. of transactions

USD 5.6 billion

Total transaction value

40,000

Merchants

3 million

Users

USD 2 billion

Cash in

IMPLEMENTATION RESULTS

Co-operation with Bac Ninh Province, Phu Yen Province, Hau Giang Province to build smart cities &

electronic government, as well as to promote cashless payment

IMPLEMENTATION RESULTS

Co-operation with many foreign partners to develop digital bank platform

AWARDS AND REGCONITION

23

LIENVIET24H

• To link all account/card sources into a single management system

• Comprehensive card management (issusance, new card registration, activation, card opening/close, transaction

statements, credit card payment, PIN change, etc)

• Comprehensive management of bank accounts and customers’ payment services on an omni-channel platform

• Online loans application, disbursement and loans management

• Integration with CRM, Credit Scoring system for online micro and consumer lending

IS THE VI VIET UPGRADED VERSION FOR OMNI CHANNEL DEPLOYMENT

• Developed by Lien Viet Technology Development Company (LienVietTech)

• Intergrate all online banking transaction channel into a single platform supporting both banking users and unbank

segment to experience 3 in 1:

Vi Viet application

Internet Banking & Mobile Banking

Card service and management

• Support Offline channel: at counters (document selection/cash management) and ATM (cash withdral by scanning

QR code)

SIGNIFICANT FUNCTIONS:

24

LIENVIET24H

HOME

Vi VietDigital Banking

Card Service

LIENVIET24H

Web application for customers – integrating Internet Banking and ViViet.vn▪ To intergrate Internet Banking, ViViet.vn and card service manament into a single

website

Teller system at counters▪ To provide a teller application for tellers to perform all operations related to Vi Viet,

Internet Banking, Mobile Banking and card service

Mobile applilcation for customers (IOS, Android) – integrating Vi Viet application and

Mobile Banking

▪ To intergrate Mobile Banking, Vi Viet application and card service manament into a single

platfom

LIENVIET24H – SERVICE AND FUNCTION

Card service

Digital

Bank

Vi Viet

▪ Remittances

▪ Payment

▪ Savings account

▪ Loans application

▪ Banking statements

▪ Payroll service

▪ Corporate banking

▪ Online registration

▪ Cash in/Cash out

▪ Money transfers

▪ Payment with QR code

▪ Bill payment

▪ Account balances

▪ Online shopping

Card information

Money transfers

Payment

Statement, balance

Open/Close Card

PIN reset

27

To develop technology platform as the core to

connect and build the finance and payment

Ecosystem

Creating solutions such as CRM, Loyalty program,

Sales management, Billing, Booking, etc with

payment gateway on cloud plaform for partners

(Finance company/ Telecom/ Logistics/ Education/

Real Estate/ Insurance/ supply chain, e-commerce,

etc) to join the Ecosystem at low cost (or free of

charge).

Mining data from partners to deploy financial

services.

Expanding the merchant network outside Vietnam

BANKING SERVICES

PAYMENT, OTHERS

Technology Company

WholesalesRetails

Suppliers

Telecom

Logistics, Taxi

Enterprise

Consumers

Payroll

Social Security

Remittances

Loans

Mobile, Internet, TV

Onlineshopping

Bills TaxiLogistics

Others

Savings

Bank

Finance Company

PublicServices

Tuition fee

Appartment

Insurance

Utilities

School/ University

Insurance Company

Smart City

PHÁT TRIỂN HỆ SINH THÁI

4.0 INDUSTRY REVOLUTION

Cloud service usersWhere is our data?We are concerning about security issue

In the near future, we believe that BlockChain with decentralizeauthentication and storage mechanism will be the foundation of trustwithout the requirement of an intermediary authentication organization.

4.0 INDUSTRY REVOLUTION

BigData + AI: datacollection and analysisfrom many sources such asSocial Network, CIC, Telco,user behavior

Effective tool for retailbanking- Credit scoring support- Personalized CRM

LIENVIETPOSTBANK

LienVietPostBank is open to

discuss for collaboration,

connection with all patners,

accelerating to process of digital

transformation and ICT

infrastructure development in

Vietnam

THANK YOU

digital bank transformation strategy of …

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