Finastra’s annual global survey reveals strong interest in emerging technologies and banking models amongst Vietnam financial institutions, despite technology investments being constrained by challenging economic conditions.
The ‘Financial Services: State of the Nation Survey 2023’ finds that 91% of finance executives surveyed in Vietnam say their institution is interested in generative AI – the highest of all the markets surveyed. This includes 58% whose organization has already implemented generative AI in some way or is researching, testing or trialing the technology. Just 3% say their institution has no interest in generative AI.
Bullish on BaaS and embedded finance
Vietnam has the highest proportion of decision makers whose organizations have deployed or improved their embedded finance capabilities in the last 12 months (58%, vs 41% globally), as well as the second-highest proportion deploying or improving BaaS capabilities (55%, vs 48% globally). This reflects the Vietnam decision makers’ enthusiasm for the emerging banking models, with 89% seeing them as business growth and revenue generators – the highest globally apart from Hong Kong (95%).
Economic conditions constrain investment plans
The challenging economic climate has affected banks’ investment plans globally, with significant proportions in every market saying their financial institution’s investments in technology and digital banking have been constrained to some extent. This is highest in Vietnam, where 87% say their organization’s investments have been constrained – including 32% whose organizations have been heavily constrained. However, 67% have either resumed their investments in full or expect to have done so by the end of H1 2024.
Growth potential in green lending
There is a strong perception that ESG-focused finance can benefit both financial institutions and communities, with 91% in Vietnam agreeing that a focus on ESG and sustainability will be the next big disruptor in the sector. This is the highest globally and significantly more than the global average (79%).
In particular, 82% agree that ‘green lending’ provides an opportunity for growth and revenue generation. One of the keys to unlocking this potential might be generative AI. Of those interested in the technology, the most popular use (current or planned) globally is the collection, processing and analysis of data for ESG decision-making or criteria classifications (36%), with 44% in Vietnam planning to use it in this way – the highest globally behind Saudi Arabia (47%).
“Despite the challenging economic climate, it’s clear from our research that investment in AI, BaaS, and embedded finance remain key priorities for financial services organizations over the next 12 months, particularly as they seek to further enhance and personalize the customer experience,” said Simon Paris, Chief Executive Officer at Finastra. “We share the industry’s ongoing commitment to ESG initiatives, to collaboration around Open Finance, and excitement in using advanced technologies like AI to help deliver on the opportunities ahead.”
It is known that a total of 956 professionals (at managerial level) in financial institutions and banks across the US, UK, France, Germany, Hong Kong, Singapore, Saudi Arabia, Vietnam and the UAE participated in this survey. These financial institutions represent a gross total of around USD$33 billion in turnover over the last 12 months, employ approximately 2.4 million staff and have approximately 240 million partner and customer relationships.
About Pioneer
Pioneer Marketing & Public Affairs is a premier Vietnam-based consultancy that provides a diverse range of insight-driven solutions to clients in various industries. Founded in 2004, we have been offering public-affairs and marketing communications solutions to clients in aviation, banking, e-commerce, fintech, FMCG, nutrition, and information and communications technology. For more information, please visit: https://pioneervn.com/who-we-are/
