Recently, on November 2, the State Bank of Vietnam (SBV) held an online conference to implement the “Scheme to enhance access to banking services for the economy” as stipulated in Decision 1726/QD-TTg approved and promulgated by the Prime Minister of the Government of Vietnam on September 5, 2016.
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In order to improve access to basic banking services that meet the needs, are of quality, and come at reasonable costs for the majority of the adult population and businesses, especially those in rural, remote, and isolated areas, as well as small and medium-sized enterprises, based on a system of credit institutions operating safely, healthily, responsibly, and sustainably, the Prime Minister of the Government of Vietnam has approved certain targets to strive for by 2020 as follows:
- 70% of the adult population will have payment accounts at the banking system;
- At least 20 branches or transaction offices of commercial banks per 100,000 adults;
- 30,000 ATMs (approximately 40 ATMs per 100,000 adults);
- 300,000 POS terminals (approximately 400 POS machines per 100,000 adults);
- The proportion of branches and transaction offices of commercial banks in rural areas will reach approximately 15%;
- Approximately 35 - 40% of the adult population in rural areas will have savings at credit institutions;
- Approximately 50 - 60% of small and medium-sized businesses currently operating will borrow funds from credit institutions;
- Double the proportion of income from non-credit service activities in the total income of commercial banks.
Throughout the proposal issued in Decision 1726, the Prime Minister mentions 3 main issues:
- Increasing the supply channels of banking services;- Increasing the number and quality of banking service products, with simple and accessible designs for the public and businesses, especially for people in remote and isolated areas, and for the poor;- Increasing the degree of utilization of banking services by the population and businesses.
Alongside the 3 primary issues and 8 target indicators stated above, at the Online Conference, the State Bank of Vietnam highly evaluated 7 groups of solutions:
- Perfecting institutional policies to create a favorable environment for diversifying banking service products, especially non-credit banking services, and maintaining financial health during the restructuring of credit institution systems;
- Expanding the service supply network of credit institutions while focusing on enhancing the capacity and operational efficiency of the Social Policy Bank, with a reasonable roadmap to develop the people's credit fund system and microfinance institutions;
- Emphasizing the application of information technology and telecommunications technology to develop service products aiming to enhance access to banking services for the population in rural, remote, and isolated areas;
- Enhancing the service supply capacity of credit institutions for small and medium-sized enterprises;
- Improving the quality of customer information to support credit institutions in accessing complete information to improve credit quality;
- Boosting communication activities about the banking sector, promoting banking products and services to broad sections of the rural, remote, and isolated populations, and enhancing the connection between banks and businesses;
- Other support solutions in investment policies for infrastructure, insurance, finance, etc.
Although these 7 groups of solutions are comprehensive and specific, to enhance access to banking services for the economy, alongside the efforts of the entire banking sector, there is also a need for the coordination of other ministries and sectors.
