Accelerating Digital Transformation and Enhancing Payment Efficiency
The State Bank of Vietnam (SBV) reported that in the first half of 2024, cashless payment activities and digital transformation in the banking sector continued to yield positive results, with critical payment systems operating smoothly and securely. Currently, over 87% of adults have a bank account, and many banks have processed over 95% of transactions digitally. Compared to the same period in 2023, the number of transactions through the interbank electronic payment system increased by 2.83% in volume and 26.94% in value.
As a pioneer in digital transformation, OCB has consistently prioritized investments in technology. In May 2024, the bank officially introduced OCB OMNI 4.0, optimally catering to consumers’ needs for speed and convenience and setting new industry standards in Vietnam. Featuring one-touch QR payment functionality, the app enables seamless transactions at thousands of different service points, from e-commerce to travel. The app also offers modern and convenient digital banking services such as account opening and management, money transfers, bill payments, card services, deposits, loans, and more.
OCB launches OCB OMNI 4.0, optimally meeting consumers’ needs for speed and convenience
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In addition to OCB OMNI, Liobank, a digital banking product for the youth, introduced by OCB in early 2023, is also one of the few products that has been well-received by the Gen Z market and highly appreciated for its convenient tech experience. Customers can use the Shake to Pay feature to transfer money by simply shaking their phones, leveraging short-range NFC technology combined with Contact Matching for a fast, fun, and novel transaction experience for tech-savvy young users. The payment response feature is also capturing the youth market well, as customers can respond to incoming payments without knowing the sender’s account number, transfer money to Liobank users in their phone contacts, and create folders to manage utility bills, among other things. Notably, customers instantly receive up to a 10% cash-back and can proactively choose their cash-back categories for the month. As of June 2024, Liobank has processed nearly 10 million transactions, achieving an impressive 200% growth rate compared to 2023.
“Currently, Liobank is one of the few applications on the market that can provide 100% online loans. Notably, this app facilitates access to loans and credit cards with varying limits for individuals with middle to upper-middle incomes. All procedures and processes on Liobank are entirely digital and automated, eliminating the need for customers to visit any physical branches to use the bank’s services,” added the OCB representative.
Moreover, the OCB Propay digital payment solution saves businesses 80% of their time and encourages the adoption of digital solutions. Specifically, by employing modern Open API technology, OCB ProPay specializes in connecting all of a company’s individual management software, including the OCB OMNI digital bank, onto a single platform, thereby increasing the efficiency of information processing while ensuring high accuracy in personnel, partner, and financial data.
The robust digital transformation that OCB has undertaken is attracting a large number of customers to switch from traditional to digital channels, enhancing payment efficiency, and laying a solid foundation for its sustainable development strategy. According to statistical data, cumulative results for the first half of 2024 compared to the same period last year show a 76% increase in OCB OMNI transaction volume, a 52% rise in non-term deposits (Casa), and a 53% increase in term deposits (Esaving). In the card business segment, transaction turnover increased by 27%, and net revenue grew by 32%.
Credit Growth: A Bright Spot, Ready to Surge in the Second Half of the Year
Although the economy’s capital absorption capacity has been weak, banks, notably OCB, have made significant efforts to implement solutions to improve businesses’ access to capital and boost credit growth. According to financial reports, OCB’s credit growth as of June 30, 2024, reached 6.3%, higher than the industry average. By gradually shifting its customer structure, improving competitiveness, developing the small and medium-sized enterprise (SME) segment, and offering numerous practical financial programs and solutions with fixed-interest rate incentives, OCB has witnessed a nearly 18% increase in credit for the SME customer group.
In addition to interest rate and exchange rate support, OCB is also focusing on digitizing financial products and services to enhance convenience and reduce transaction time for corporate customers.
 OCB continuously launches programs for SME businesses
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As of the end of the second quarter of 2024, the bank’s TT1 mobilization slightly decreased compared to the end of 2023 due to proactive capital source adjustments, resulting in optimized capital costs. Total net revenue increased by 2.4% year-on-year to VND 4,559 billion, and core business activities maintained stable growth thanks to the “fruits” of the digital transformation strategy.
According to the report, in the first six months, increased provisioning and operating expenses led to a total profit of VND 2,113 billion for the bank, a 17.5% decrease compared to the same period in 2023. Commenting on this issue, OCB’s leadership shared: “Enterprises and individuals are still facing many difficulties, resulting in high non-performing loans across the entire banking system. Therefore, to strengthen its buffer and ensure its operations amid a market with many unpredictable variables, OCB has increased its provisioning. Additionally, we have focused on network expansion, talent development, and technology enhancement. While this may impact the bank’s profitability in the short term, it will lay a solid foundation for its long-term sustainable development.”
It is known that, at the end of 2023, OCB opened 10 new branches and transaction offices. In 2024, with the approval of the SBV, the bank plans to open 17 more branches and transaction offices, bringing the total to 176 locations in 48 provinces and cities nationwide. The bank’s personnel increased by 12% in the first six months, and employee benefits and income also improved, rising by 15%.
As of June 30, 2024, the bank’s total assets remained stable at the beginning of the year at VND 238,884 billion. The bad debt ratio and regulations on capital adequacy and liquidity ratios were well controlled, ensuring compliance with SBV regulations.
The year 2024 is considered crucial in OCB’s development strategy for the 2021-2025 period. Therefore, in the last months of the year, the bank will focus on accelerating the growth of individual customers in the middle and high-end segments with tailored products that cater to their specific needs. OCB will also maximize resources, streamline operations, prioritize business support, and expedite transaction processing. Additionally, the bank will implement new and effective policies to enhance credit quality, accelerate non-performing loan handling, and advance digital transformation. “In the first half of the year, both objective market factors and our proactive policies to support customers, along with increased technology and personnel investment, have led to results for the second quarter and the cumulative six-month period that did not meet our expectations. However, with a focus on stable, transparent, and sustainable growth, along with a clear strategy and specific action plan, I am confident that we will achieve better results in the second half of the year,” said Mr. Pham Hong Hai, CEO of OCB.
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