OPEN BANKING Revolution in Vietnam

Banking sectors new revolution is the open banking. To keep up with the rapid financial landscape, Vietnam is introducing open ApIs. We can get an idea about digital transformation strategy by the Digital transformation in Vietnam.  About 94% of the banks have initially implemented this and 35% of banks are in the process.

Saigon Commercial Bank has shared plans to contrivance open banking practices in a very recent webinar. And in January 2020 developer portals are launched by Joint Stock Bank and Orient Commercial joint stock bank with open ApIs. In jurisdictions such as UK, the European Union and Australia the Regulatory reality Open banking is the actual practice. The Central bank has been actively pursuing partnership opportunities to accelerate development. In digitalization towards banking and financial services industry, Sbv is the leader. To develop a standardized Open API in the banking sector, Vietnam has signed a Memorandum of Understandings (MoU) with Korea’s National IT Industry Promotion Agency (NIPA) and Korea Financial Telecommunications and Clearings Institute (KFTC).

The central bank is now in the process of revising existing regulation to create a complete framework for fintech and support digitalization in banking, said SBV governor Le Minh Hung in September 2020. In addition to that, it will be revising existing legislations to support banks and financial institutions applying new technologies including new guidance in cashless payment, the adoption of remote verification process (eKYC), and the revision of the Law on Prevention of Money Laundering, among others.

In open banking, Vietnam is lagging behind when compared to Singapore, Malaysia, the Philippines and Thailand. In December 2020, the first version of the draft Circular on Open Finance was released by the Central Bank in Philippines. It was a proposed framework for open banking in the country. And then, Singapore has adopted an organic approach to open banking with adoption being nevertheless facilitated by the Monetary Authority of Singapore (MAS). In Thailand, open banking has been driven by banks themselves. Similarly, to Singapore, SBV governor Le Minh Hung said that they have taken a market-driven approach to open banking with a non-mandatory guideline framework for working with open data and open APIs in September 2020.