Banking & Finance

The State Bank of Vietnam (SBV) has decided to establish a steering committee on digital transformation in the banking sector, headed by SBV Governor Nguyen Thi Hong. It will be responsible for promoting the digital transformation process at credit institutions and foreign bank branches, creating the conditions needed for the implementation of Industry 4.0 in the banking sector.

Interest rates at finance companies are higher than those at commercial banks for many reasons. Finance companies are not allowed to mobilize deposits from individuals, and their main source of operating capital is charter capital and funds mobilized in the money market and capital market. Their customers tend to be low- and middle-income earners with small-value, short-term loans. Lending is done through points of sale service introductions, so more staff are needed. The Governor of the State Bank of Vietnam has, however, affirmed that the establishment and existence of consumer finance companies meets a practical need and gives customers who are unable to access loans from commercial banks the opportunity to still borrow capital. It is very much necessary to exert management oversight and ensure that the operations of finance companies comply with legal regulations.