Opportunities and challenges of asia commercial joint stock back in developing digital banking

BANKING ACADEMY BANKING FACULTY - - GRADUATION THESIS TOPIC: OPPORTUNITIES AND CHALLENGES OF ASIA COMMERCIAL JOINT STOCK BACK IN DEVELOPING DIGITAL BANKING Student : Luong Thuy Trang Class : K21CLCA Course : 2018 -2022 Student’s ID : 21A4010990 Lecturer : Ph.D Nguyen Minh Phuong Ha Noi, 05/2022 Tai ngay!!! Ban co the xoa dong chu nay!!! 17014128197551000000 BANKING ACADEMY BANKING FACULTY - - GRADUATION THESIS TOPIC: OPPORTUNITIES AND CHALLENGES OF ASIA COMMERCIAL JOINT STOCK BACK IN DEVELOPING DIGITAL BANKING Student : Luong Thuy Trang Class : K21CLCA Course : 2018 -2022 Student’s ID : 21A4010990 Lecturer : Ph.D Nguyen Minh Phuong Ha Noi, 05/2022 GUARANTEE STATEMENT I guarantee that this thesis is my own original work All data included in the thesis is assured to have a clear, well-founded source, and conclusions are drawn from the synthesis and analysis methods used during the research All references used in this article are cited as standard by me I take full responsibility for this thesis ACKNOWLEDGEMENT From the beginning of my studies at the academy till now, I have had a lot of support from my teachers, family, and friends I would not have been able to finish my Graduation thesis without these resources I would want to express my gratitude to all of the teachers at Banking Academy, particularly those in the Banking Faculty, for their precious understanding and passion in helping me improve my knowledge I would want to express my gratitude to my instructor, Dr Nguyen Minh Phuong, who has personally guided and assisted me in the completion of this graduation thesis I would like to say thanks to all of my coworkers at ACB Thang Long Branch for creating advantageous conditions, supplying me with internal data, and allowing me to approach branch customers Moreover, I would like to express my gratitude to all of the customers who took part in my survey and interview Without such support, completing this thesis would have been tough for me Finally, I feel grateful for my family, relatives, and friends for their unwavering support and encouragement throughout my internship and thesis completion This thesis cannot avoid shortcomings due to time constraints and my lack of experience As a result, I am looking forward to receiving the lecturers' advice and suggestions, so that I can supplement and develop my knowledge and better my practical work in the future TABLE OF CONTENTS GUARANTEE STATEMENT ACKNOWLEDGEMENT TABLE OF CONTENTS GLOSSARY LIST OF TABLES LIST OF FIGURES INTRODUCTION Rationale of the research Literature review 10 2.1 International reviews 10 2.2 Domestic reviews 11 Scope and Objective of the research 13 Research methodology 13 CHAPTER 1: DEVELOPMENT OF DIGITAL BANKING IN VIETNAMESE COMMERCIAL BANKS 15 1.1 OVERVIEW OF DIGITAL BANKING 15 1.1.1 Definition 15 1.1.2 Features and Classification 16 1.1.3 Function 17 1.2 DIGITAL BANKING DEVELOPMENT IN VIETNAMESE COMMERCIAL BANKS 19 1.2.1 The current situation of digital banking development in the world 19 1.2.2 The current situation of digital banking development in Vietnam 21 1.2.3 Current situation of customers' trends in using digital banking products and services 25 1.3 EXISTENCE 27 CONCLUSION OF CHAPTER 31 CHAPTER 2: DIGITAL BANKING IN ASIA COMMERCIAL JOINT STOCK BANK 32 2.1 OVERVIEW ABOUT ACB 32 2.1.1 Establishment and Development 32 2.1.2 Organizational structure and Operation 32 2.1.3 Business Operation Situation 34 2.1.4 Achievement of ACB in developing digital banking 39 2.1.5 About “ACB ONE” – ACB’s digital banking 40 2.1.6 Growth in business performance 41 2.2 STRENGTH AND WEAKNESS OF ACB IN DEVELOPING DIGITAL BANKING 44 2.2.1 Strength of ACB’s digital banking 45 2.2.2 Weakness of ACB’s digital banking 46 2.3 DISCUSSION ABOUT OPPORTUNITIES AND CHALLENGES IN DIGITAL BANKING DEVELOPMENT OF ACB 47 2.3.1 Opportunities 47 2.3.2 Challenges 49 2.4 OPPORTUNITIES AND CHALLENGES: BASED ON CUSTOMERS’ ASSESMENT 51 CONCLUSION OF CHAPTER 56 CHAPTER 3: RECOMMENDATION 57 3.1 TOWARDS THE GOVERNMENT 57 3.2 TOWARDS VIETNAMESE COMMERCIAL BANKS 57 3.3 TOWARDS ASIA COMMERCIAL JOINT STOCK BANK 61 CONCLUSION OF CHAPTER 63 REFERENCES 64 APPENDIX: ONLINE SURVEY FORM 66 GLOSSARY Abbreviation Meaning ACB Asia Commercial Joint Stock Bank VPB Vietnamese Prosperity Joint Stock Bank MBB Military Commercial Joint Stock Bank VCB Joint Stock Commercial Bank for Foreign Trade of Vietnam BIDV Joint Stock Commercial Bank for Investment and Development of Vietnam OCB Orient Commercial Joint Stock Bank SBV State Bank of Vietnam TPBank Tien Phong Commercial Joint Stock Bank Vietinbank Vietnam Joint Stock Commercial Bank for Industry and Trade Fintech Financial Technology E-commerce Electronic Commerce E-banking Electronic banking ATM Automated teller machine POS Point of Sale (machine) SMEs Small and Medium-sized enterprises IoT Internet of Things IT Information Technology API Application Programming Interface AI Artificial Intelligence LIST OF TABLES Table 1-1: Comparison between Digital banking and E-banking 15 Table 2-1: ACB's business performance in 2019-2021 _ 34 Table 2-2: Growth in business performance of ACB Thang Long Branch (November 2021 –April 2022) 41 Table 2-3: Customers' assessment _ 54 LIST OF FIGURES Figure 1-1: Using time in digital banking of customers 25 Figure 1-2: Frequency in using digital banking per weeek 27 Figure 2-1: Organizational structure of Asia Commercial Joint Stock Bank 33 Figure 2-2: Increase in total asset from 2019-2021 35 Figure 2-3: Increase in Deposits from customers (2019-2021) 35 Figure 2-4: Increase in Loans to customers (2019-2021) 37 Figure 2-5: Increase in General business performance 38 Figure 2-6: Increase in the number of new customers, accounts, cards (from November 21 to April 22) 43 Figure 2-7: Increase in CASA and Online saving amount from November 2021 to April 2022 44 Figure 2-8: Customers’ satisfaction 55 INTRODUCTION Nowadays, with the increase of every sectors in the world, especially the technology and economy, banking industry plays an important role in every aspect of them The stronger the banking industry gets, the more developing the economy becomes There is no denying, that banks in general are concentrating on bringing the most efficient financial solutions to their customers As a result of that, technologies are also applied in banking, in order to help the bank to deliver their bannking products and services in the most effective condition to their customers As a matter of fact, digital transformation is being applied in every areas of social life, including banking services In recent years, Vietnamese banks have been focusing on expanding their services by actively applying electronic technologies to simplify the customer service process The development of Fintech companies also contributes to encouraging traditional banks to improve technology The Industrial Revolution 4.0 along with the development of information technology has an impact on all areas of socio-economic life In particular, the strong development of financial technology companies (Fintech), transformation into digital banks is a sustainable development direction for banks in the world and in Vietnam It is no denying that outdated business models are replaced by such modern ones, every firm has to rethink about the strategies of business and management, banks are not exception to this revolution, which leads to an adaptation called “Digital banking” Notably, the COVID-19 pandemic has changed the perception and gradually changed the habit of using banking services of the majority of Vietnamese people on digital platforms This is both an opportunity and a challenge for banks in Vietnam in developing digital banking Rationale of the research Commercial banks in Vietnam have had various changes in the last few years, it is seen that the development of banking services and products are at a steady stage The release of digital banking in Vietnamese commercial banks was not only to be an adaptation to this modern world, but also to diversify banking products and services, with a view to opening up more and more opportunities, and competitive capabilities of these banks In particular, the appearance of digital banking is such an achievement of commercial banks in Vietnam Thus far, digital banking has been breaking the barriers