Developing the electronic banking services at joint stock commercial bank for foreign trade of viet nam tan dinh branch 2022

MINISTRY OF EDUCATION AND TRAINING THE STATE BANK OF VIETNAM HO CHI MINH UNIVERSITY OF BANKING *********************** NGUYEN THI CAM PHUONG DEVELOPING THE ELECTRONIC BANKING SERVICES AT JOINT STOCK COMMERCIAL BANK FOR FOREIGN TRADE OF VIETNAM - TAN DINH BRANCH GRADUATE THESIS MAJOR: BANKING AND FINANCE CODE: 7340201 HO CHI MINH CITY, 2022 MINISTRY OF EDUCATION AND TRAINING THE STATE BANK OF VIETNAM HO CHI MINH UNIVERSITY OF BANKING *********************** NGUYEN THI CAM PHUONG DEVELOPING THE ELECTRONIC BANKING SERVICES AT JOINT STOCK COMMERCIAL BANK FOR FOREIGN TRADE OF VIETNAM - TAN DINH BRANCH GRADUATE THESIS MAJOR: BANKING AND FINANCE CODE: 7340201 SUPERVISOR Assoc Prof Dr HOANG THI THANH HANG HO CHI MINH CITY, 2022 i EXECUTIVE SUMMARY Today, information technology plays a very important role in the development of industries in the economy As the economy develops, people's living and awareness levels are higher, and the demand for information technology is more powerful and diverse However, what is important is how new technologies can promote the highest efficiency in their application Banking is one of the fastest and most thorough applications of information technology The strong development of the information technology industry has made great changes in the field of traditional banking technology The introduction of ecommerce products and services into banks will diversify traditional banking products and services, opening up new opportunities and new competitiveness The development of electronic banking services is always invested by commercial banks, digital technologies, new technologies, high technologies, information and telecommunications infrastructure in products, to improve the quality of customers, raise the efficiency, and sustainable development of each bank In Viet Nam, banking services still have many different waunderstoodanding, the regulations on banking services are still plentiful, however, banking services are widely interpreted as the entire banking operations provided by commercial banks to the economy called banking services The development of e-banking services is an inevitable trend in the context of international economic integration It' s not since the covid - 19 pandemic occurs, the new number of development payments developed from a long time, in many countries around the world, the absence of cash has become a strong payment trend ii DECLARATION I hereby declare that this is my own research work, the research results presented in the thesis are honest and objective The sources of information cited in this thesis are clearly indicated I am responsible for my thesis Signature Nguyen Thi Cam Phuong iii ACKNOWLEDGE Firsthand and foremost, I am really grateful and would like to send my sincerest and special thanks to my supervisor, Ms Hoang Thi Thanh Hang for helping me to finish this challenging thesis In spite of my defects throughout the process of performing the thesis, she always showed her carings and enthusiasm to support me to overcome Without her conscientious guidance and support, this thesis cannot be successfully accomplished Next, I would like to express my deepest gratitude to the teachers who are teaching at Banking University of Ho Chi Minh City, who have spread the fire, passion and knowledge about economics from the most basic subjects, helping me to have a background in finance - banking Finally, I would like to thank you to my family, friends, and colleagues who have always encouraged and helped me in the process of studying and researching the topic Although I have tried a lot, the thesis is not free of shortcomings I really hope to receive the sympathy, guidance, help, and support of my colleagues iv TABLE OF CONTENTS EXECUTIVE SUMMARY i DECLARATION ii ACKNOWLEDGE iii LIST OF ACRONNYMS .vii LIST OF TABLES viii LIST OF FIGURES ix INTRODUCTION 1 The Importance Of Research Topic Research Objectives 2.1 General objective 2.2 Specific objective Research Questions Research Subjects and Scope 4.1 Research subjects 4.2 Research scope Research methods Contribution of the topic Review of related research 7.1 Review of domestic research 7.2 Review of foreign research CHAPTER 1: OVERVIEW OF ELECTRONIC BANKING SERVICES DEVELOPMENT 1.1 Overview of electronic banking services 1.1.1 The concept of electronic banking 1.1.2 Development stages of electronic banking 11 1.2 Criteria to measure the development of electronic banking services 13 v 1.2.1 The increase in the number of customers using e-banking services 13 1.2.2 Proportion of e-banking services used by customers 14 1.2.3 The increase in revenue from e-banking products and services 14 1.3 Experience in developing of electronic banking services at commercial banks 15 1.3.1 Military Commercial Joint Stock Bank 15 1.3.2 Asia Commercial Join Stock Bank 16 1.3.3 Tien Phong Commercial Joint Stock Bank 18 1.3.4 Lessons for Joint Stock Commercial Bank for Foreign Trade of Vietnam Tan Dinh Branch 19 SUMMARY OF CHAPTER 22 CHAPTER 2: THE SITUATION OF DEVELOPMENT OF ELECTRONIC BANKING SERVICES AT JOINT STOCK COMMERCIAL BANK FOR FOREIGN TRADE OF VIETNAM – TAN DINH BRANCH 23 2.1 Overview of Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh branch 23 2.1.1 Introduction to the history of establishment and development of Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh branch 23 2.1.2 The organizational structure of Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh branch 24 2.1.3 Overview of the business performance of Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh branch in the period 2017 - 2021 27 2.1.3.1 Product 27 2.1.3.2 Business Situation of VCB Tan Dinh Branch 33 2.2 Analyzing the situation of developing e-banking services at Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh branch 34 2.2.1 Number of customers using electronic banking services 34 2.2.2 Proportion of using products of e-banking services 37 2.2.3 Revenue from transactions of e-banking services 38 2.3 Evaluation of the current situation of developing e-banking services at Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh branch 40 2.3.1 Achievements 40 vi 2.3.2 Limitations and causes 43 2.3.2.1 Limitations 43 2.3.2.2 Causes of limitations 45 SUMMARY OF CHAPTER 48 CHAPTER 3: SOLUTIONS FOR DEVELOPMENT OF ELECTRONIC BANKING SERVICES AT JOINT STOCK COMMERCIAL BANK FOR FOREIGN TRADE OF VIETNAM – TAN DINH BRANCH 50 3.1 Development orientation of e-banking services at Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh branch 50 3.1.1 General orientation 50 3.1.2 Specific orientation 51 3.2 Some solutions to develop electronic banking services at Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh branch 52 3.2.1 Developing direction and strategy of operation 52 3.2.2 Technology base 53 3.2.3 Human Resources 54 3.2.4 Other solutions 56 3.3 Recommendations to Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh Branch 57 SUMMARY OF CHAPTER 62 CONCLUSION 63 REFERENCES vii LIST OF ACRONNYMS Acronnyms Meaning E-banking VCB Electronic Banking Joint Stock Commercial Bank For Foreign Trade Of Vietnam Military Commercial Joint Stock Bank Asia Commercial Join Stock Bank Tien Phong Commercial Joint Stock Bank Automatic Teller Machine Cost, Insurance, Freight One Time Password Short Message Service Point Of Sale MB ACB TP ATM CIF OTP SMS POS viii LIST OF TABLES Table Business products at VCB Tan Dinh 27 Table 2 Business performance results of VCB Tan Dinh in 2018 – 2020 33 Table Number of customers using e-banking services at VCB Tan Dinh Branch 35 Table Number of cards issued at VCB Tan Dinh branch 35 Table Number of activations of e-banking services at VCB Tan Dinh 37 Table Revenue from non-cash payment services at VCB Tan Dinh 39 54 The development of e-banking services must be accompanied by improving the processing capacity of the system, expanding the transaction network, improving service and service quality, especially ensuring security and safety for users service use; not to overload the system, leading to poor service quality, reducing customer trust, and having a psychological impact on the whole society Review and check the operation status of ATMs and POS machines of the VCB Tan Dinh branch To recall inefficient machines located at the headquarters of administrative and non-business agencies, wholesale markets, commercial centers, crowded residential areas, industrial parks, and export processing zones If so, VCB's assets will promote to their full potential 3.2.3 Human Resources In the context of today's modern economy, knowledge and human capacity have become the number one resource of countries, and therefore to ensure the development goals and requirements of e-banking services of the VCB Tan Dinh branch in the coming period, human resources and human resource development need to be done one step ahead, not only to meet the current human resource requirements but more importantly, to have a medium and long term vision to meet requirements for long term mission The building of human resources to serve the construction and development of banking products and services in general and e-banking services, in particular, must be conducted based on an objective assessment of capacity and quality of staff, reflected in the quality and efficiency of completing the work they are undertaking, and the ability to develop; but at the same time must match the actual job requirements to avoid wasting labor resources For the current team of tellers and customer relations officers, it is necessary to focus on training and fostering to improve qualifications and skills, customer care Training 55 regularly creates e-banking products and services, and operational processes for tellers and customer relations officers For new products, product training should be organized at the branch Periodically organize training on sales skills at all levels: customer relations officers, tellers, and customer service officers on skills of customer communication, introduction, product sales, development, and maintaining relationships with customers… Along with training, it is necessary to monitor and use staff after training appropriately, avoiding sending staff to the wrong training group or arranging other jobs after retraining Each department should have a focal point to update documents from the head office and collect problems, difficulties, or common errors in the consulting and operation process Monthly, the branch organizes experience exchange sessions between departments and collects opinions on new documents and directions to have timely feedback from the head office Through these sessions, all employees of the branch can grasp the most basic features of the product so that they can advise customers anywhere, anytime Urgently develop mechanisms and policies to motivate staff, build a mechanism to distribute income associated with work efficiency, and the goal of this is not only to encourage and motivate the current workforce It is also the basis to attract qualified labor from outside to the VCB Tan Dinh branch Review, analyze and evaluate the resource allocation ratio of the whole branch to make appropriate adjustments, arrange reasonable staff under qualification requirements, and increase the efficiency of resource use Create a professional, dynamic and innovative working environment through which employees are encouraged to work enthusiastically and creatively Create many learning and promotion opportunities for all qualified staff The branch needs to make many improvements in quarterly employee evaluation and classification Each department needs to have an objective and fair assessment for each employee, there must be a screening and selection of 56 people who work better to have a worthy reward to motivate everyone to strive and avoid disappointment, leveled as it is today 3.2.4 Other solutions Through the actual survey results of customers using e-banking services of VCB Tan Dinh branch, in addition to continuing to promote the factors highly appreciated by customers such as reasonable service fees, other In the social activities that VCB Tan Dinh branch has implemented, it is necessary to focus on the factors that are undervalued by customers such as the process and procedures for registering to use the service, the time to handle customer complaints to fix and perform better soon Specifically: About the service registration process and procedures: Currently, the promulgation of professional processes and regulations is done by the departments at the head office, the branch has no authority to issue it and cannot violate the processes and regulations issued by the central government However, branches can still recommend heading office departments reconsider Because this issue is systematic, it needs to be considered from many angles (the form should be simple and easy to understand, but it also needs to be bound by strict terms and conditions of use ) to ensure safe and effective business operations Processing time for customer complaints: In the process, it will be very specific that the time to handle customer complaints must not exceed how many days However, the branch needs to thoroughly understand all employees to handle customer complaints as soon as possible, avoiding the case that due to too much work, the teller "soaks" until the expiration date is close to the regulations recently processed, or the seller has already done it, but the controller has not approved it These things are simple, but they greatly affect the quality of services and the image of VCB's brand in the eyes of customers 57 There should be close coordination between professional departments at the branch such as the computing department, accounting department, customer care department, etc with the head office to improve service quality such as transmission speed; ATM camera image storage; update new applications, new versions; ensure customer support to keep information and data secure when making transactions on the internet as well as warn customers which markets have many risks so that customers can be more careful when making payments, This, on the one hand, shows the branch's interest in customers, on the other hand, ensures the safety of customers' online payment activities and also ensures the safety of the branch's payment activities 3.3 Recommendations to Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh Branch Firstly, build and design e-banking products and services in the direction of diversification to improve the utility and quality of services for customers VCB needs to examine and rebuild a portfolio of diversified, multi-utility products and services with quality standards, high technology functions, and attractive characteristics compared to the market to create A difference in competition and ensures the increasing scale and efficiency of production and business activities Along with perfecting existing E-banking products and services, VCB needs to focus on developing new E-banking products and services For card products: In the future, perhaps the card type will gradually disappear and be completely replaced by mobile devices But now the card product is the premise to create a cashless payment ecosystem and contribute significantly to the bank's profits Therefore, VCB can still fully exploit this product by diversifying the card product portfolio: 58 It is necessary to develop new products for application on ATMs and POS such as connecting payment with services of collecting electricity, water, and phone bills, paying insurance premiums, and paying automatic airfares for customers For e-banking products: With the desire to lead the market in the field of ebanking, VCB needs to research, develop and provide services at a higher level Updating high-tech applications to technology registration procedures and documents, contributing to building an e-bank that operates entirely on the network For Internet Banking service: - Develop more services such as Fund management, overdraft service, mortgage loan of passbook (for online savings book products), online consumer loan, mobile banking - VCB should link more service providers so that customers can pay bills directly on the web without having to transfer money to pay like now - Open more features to appear a specific fee notice board for each type of transaction before the customer completes the operation, this will help them understand the content of the fees collected and consider it before executing the order on the system - Design the interface of the E-banking version lively and user-friendly Related features and utilities should be placed close to each other for customers to easily identify - Implement more utility of payment by list (salary payment, business partners, customers ) on Internet banking channels for individual and corporate customers For Mobile Banking service: - Inquiry about credit card information - Overdraft loan service 59 - Diversified service registration channels, currently registration is mainly at transaction counters, via the Internet (via VCB Online service) Additional registration channels at ATMs - Expanding the number of Web browsers, and operating systems compatible with versions of e-banks to help customers have more options to easily access the system For SMS Banking service: - Add more channels to register at ATMs - Work again with carriers that thoroughly understand the error of SMS notifications arriving late compared to the arising time or not announcing transactions, confusing customers in monitoring payment account fluctuations Currently, customers can deposit savings online through e-banking services, however, savings products are not as diverse as over-the-counter products and they are not allowed to participate in deposit programs Therefore, deposit and savings products when implementing the new program also need to be updated on the Mobile banking and Internet banking systems, so that customers can open their own online savings accounts and still be able to participate in new programs such as over-the-counter transactions To ensure transactions through the E-banking channel, it is necessary to choose an appropriate e-banking transaction security and authentication solution Secondly, promote the investment process, the linking process in business activities As a commercial bank, it is always at the forefront of providing added utilities to customers Currently, Vietcombank has cooperated with 10 Fintech partners (Moca, Zalopay, VNPAY, Payoo, Momo ) to deploy products and services to meet the needs of consumers According to Fintech News (2017), there are currently about 48 Fintech companies operating in Vietnam, of which more than half of Fintech startups in 60 Vietnam are providing consumers with online payment tools, or providing POS/mPOS digital payment solutions Therefore, the association with as many domestic and foreign technology enterprises as possible helps VCB to provide many services and utilities for customers as well as create a competitive advantage for itself Thirdly, the solution of a flexible pricing policy The price policy must be flexible to change according to the fluctuations of the market, and suitable for each customer Such as: - For the VIP customer segment: Research and supplement the list of investment advisory products in deposits, securities, real estate, and foreign currency options - For the loyal and stable customer segment: Develop appropriate product and service packages according to various criteria - For the general customer segment: Perform segmentation by age, occupation, gender, For example, product packages for students, product packages for young families, for women, package Men's products… Reduce service fees for transactions made through e-banking channels with periodic promotions and incentives To encourage customers to use payment via electronic channels rather than traditional methods Signing contracts with organizations providing goods and services for VCB customers with many incentives: receiving added benefits such as bigger discounts when buying online, booking hotel services, online travel Discount programs for VCB cardholders, not only for new customers but also for cardholders who have been with VCB for a long time when paying bills on online sales websites Exemption and reduction of personal financial transaction fees such as balance confirmation fees, account management fees for account holders using e-banking services Fourthly, upgrade and modernize the information technology platform, and develop infrastructure 61 Invest in developing network technical infrastructure, and building a modern information technology infrastructure Upgrade and expand the transmission line with broadband, large capacity, and high speed To improve the technical quality of E-banking services, VCB must focus on investing in the core banking system This solution helps to reduce the time to market for new products, in addition to providing unique products and services, real-time processing, consistency across all channels, and multi-currency At the same time, a successful new implementation will meet the growth of VCB as well as handle a huge number of transactions and maintain stability with many different service levels This system also simplifies operation and reduces operating costs for VCB Fifthly, increase convenience and responsiveness for customers Provide potential customers with clear and transparent instructions on how to use e-banking services through the bank's website Improve the quality of e-banking services and products: Shorten transaction processing time, and link with many service providers to increase payments Apply biometric authentication technology to e-banking products and services as a way for customers to access their accounts: fingerprint, voice, face, eyes Instead of usernames Passwords are difficult to remember today, but this form is safe and brings convenience to customers when using products and services Simplify the registration procedure to use the service and the form of recovering lost information Improve the ability to meet customers' needs by perfecting the information technology system to ensure safety and security for customers and the bank Developing and expanding the 24/7 customer center to provide timely advice and support to help customers be more confident when using modern technology products… Sixthly, develop safety policies on information technology system security 62 Recently, when money loss incidents occurred more frequently for account holders at the bank, VCB simultaneously issued warnings to its customers about ensuring information safety when using card services as well as electronic banking services How to both develop, but still ensure the reliability for customers is a requirement that is always highly appreciated by VCB in particular and commercial banks in general In-depth training for staff in charge of network and information technology system administration at branches to be able to resolve incidents in a timely and quick manner Ensuring the decentralization and decentralization of access to information technology systems, integrating with data encryption software and anti-virus programs VCB has built a backup and incident warning center to limit the possibility of incidents arising and respond quickly to possible incidents Encryption technology must be applied to connect between branches in the system, with the fast-spreading characteristics of technology problems at any point in the system, which can affect the whole system VCB needs to take advantage of the technical support of strategic partners to learn from experience in investing and using security technologies SUMMARY OF CHAPTER To improve the efficiency of e-banking services at VCB Tan Dinh branch, the branch needs to implement the following measures: Promote marketing communication; focus on exploiting potential customers, especially customer groups to cross-sell payroll services, issue cards for students, and students who collect tuition fees because these are knowledge customers children easily access e-banking services; provide professional training, change the sales mindset for bank staff about e-banking services, so that employees can have a deep understanding of the service, confidently 63 advise and discuss with customers, and easily persuade customers use e-banking services more CONCLUSION The topic: " Developing The Electronic Banking Services At Joint Stock Commercial Bank For Foreign Trade Of Vietnam - Tan Dinh Branch" focused on solving some important issues as follows: Firstly, clarifying the basic theoretical issues of e-banking service development, influencing factors, and evaluation criteria for e-banking development of commercial 64 banks At the same time, research and develop e-banking services at domestic and foreign banks that have developed e-banking services From there, draw lessons for Vietcombank Secondly, analyze the situation of developing modern electronic banking services of Vietcombank Tan Dinh from 2017 to 2021 with actual data Thereby, specifying the shortcomings and causes of those shortcomings to have a basis for proposing solutions to further develop e-banking services at the Vietcombank Tan Dinh branch Thirdly, based on the strategic business orientation of the Bank for Foreign Trade of Vietnam as well as the strategic goals of Vietcombank Tan Dinh branch The thesis has proposed groups of solutions and 10 recommendations to contribute to the development of electronic banking services at the VCB Tan Dinh branch With the solutions proposed by the thesis, there may be solutions that can be immediately applied effectively, but there are solutions that can be implemented in practice, contributing to improving the business efficiency of VCB in the future In summary, the study has proposed possible solutions that contribute to the rapid development of diverse and convenient e-banking services, increase payment speed, and limit the use of cash in the population meet the increasingly fierce competition demand of VCB Tan Dinh branch according to the market mechanism Because of the limited research time, the author only analyzes and gives general solutions to develop e-banking services at the Tan Dinh branch There has not been any in-depth research into specific solutions to develop e-banking services for each individual and institutional customer This is also the direction in which the author will conduct research topics shortly 65 REFERENCES Vietnamese Sources Báo Sài Gòn đầu tư tài (2021) Xu ngân hàng điện tử Hoa, H T (2004) Giải pháp phát triển dịch vụ ngân hàng điện tử Ngân hàng Ngoại Thương Việt Nam, 50-62 Hoàng, T H (2010) In H N Nhà xuất Lao động xã hội, Quản trị 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COMMERCIAL BANK FOR FOREIGN TRADE OF VIETNAM – TAN DINH BRANCH 50 3.1 Development orientation of e -banking services at Joint Stock Commercial Bank for Foreign Trade of Vietnam – Tan Dinh branch. .. 2: THE SITUATION OF DEVELOPMENT OF ELECTRONIC BANKING SERVICES AT JOINT STOCK COMMERCIAL BANK FOR FOREIGN TRADE OF VIETNAM – TAN DINH BRANCH 2.1 Overview of Joint Stock Commercial Bank for Foreign. .. e -banking services at the branch increase in the coming years 2.3 Evaluation of the current situation of developing e -banking services at Joint Stock Commercial Bank for Foreign Trade of Vietnam