|Harmander Mahal, head of Consumer, Private, and Business Banking for Vietnam and Asia Cluster Markets at SCB |
What are your views on the potential of Vietnam’s retail banking segment?
Vietnam is one of Standard Chartered’s focus markets globally, so clearly, we are very encouraged by not only the potential we see in this market but also the history of growth we have already witnessed.
The economy is growing very well, the employment outlook is positive, and the entrepreneurial spirit is unrivalled. The velocity of innovation and technological adoption also presents opportunities in and of itself.
One only needs to assess the demographics to see the potential in a 90+ million population. Vietnam has a young, vibrant, and digitally-savvy population which translates into a high digital adoption rate.
It has a growing middle-class and emerging affluent population, hence the need for lifestyle products like credit cards, mortgages, and investment solutions, and financial management and planning solutions such as insurance.
Banks that position themselves to effectively serve these individuals will be able to realise that potential.
Vietnam also has a favourable environment for banks to operate in. The infrastructure is good, the government is supportive, and the State Bank of Vietnam is doing a wonderful job.
Along with this, the population is becoming increasingly financially savvy.
I wouldn’t be surprised if in the next 5-10 years Vietnam becomes one of the largest retail banking markets in Asia, outside of China.
The pandemic has changed clients’ behaviours. What is Standard Chartered Vietnam’s post-pandemic strategy?
We have to recognise that the government did an incredible job managing the pandemic. Without the level of dedication that they showed, I’m not certain we would have come out of this in such good shape.
We have indeed noticed changes in consumer behaviour, but also an acceleration of trends we saw even before the pandemic. Take the demand for convenient and secure digital banking solutions, for example. I do not see this as new behaviour, but rather a heightened demand for the acceleration of innovation in the digital banking space.
The big question has always been about how we rapidly, efficiently, and effectively scale up our operation to serve the clients we have consistently committed to. For Standard Chartered Vietnam, the answer to that question is multi-fold.
Firstly, we stay future-ready. We continue to invest in our mobile and online banking platforms – where 99 per cent of our financial transactions now take place – without compromising our clients’ needs for a physical space – as shown by our recent new branch opening in Capital Place, Hanoi.
We also stay on the cusp of new market developments that will allow us to further enhance our capabilities such as electronic KYC and client onboarding. We will be introducing those features, amongst others, in the very near future.
Secondly, we partner with top organisations in the market and the financial services ecosystem, where we think we can build symbiotic relationships to scale up our business. Our first-in-market – and in Standard Chartered globally – partnership with Home Credit that launched late last year is a perfect example of this, and there are more to come.
Thirdly, we are highly focused on the affluent and emerging affluent segments. We have the best relationship managers and product specialists in the market, and a comprehensive product suite. We’ve already committed a significant amount of resources and built the best international investor service, leveraging our international network and clearing the path for foreign investors.
Finally, environmental, social and governance practices. We have launched green mortgage loans and carbon-neutral cards. This is just the beginning and we are constantly looking for ways to turn our portfolio green.
What are you doing to ensure your long-term success in Vietnam?
Our strategy was developed with a multi-year lens. Given the quantum of investment required for success, we ensure that each idea has the potential to bring benefits over the long term. Though I would add that situations and environments change, so it is imperative that we stay on our toes and adapt.
Most importantly, however, are our people. In Standard Chartered, we don’t give jobs, we build careers. We hire, train, and nurture the best talent. Our overseas hiring brings new skills and knowledge to our team here, and we also send people overseas to develop their skill set and gain exposure. These individuals then return to Vietnam, forming the foundation of a solid and resilient organisation that is here for good.
Standard Chartered Vietnam has launched multiple sustainable retail products recently. How are the products received by clients and what are the benefits?
Often, when thinking about sustainable finance, the mind turns to corporate financing for companies that are making a difference in the fight for our environment. However, retail banks clearly also have enormous potential to catalyse change and create real impact.
Launching sustainable products is part of our ongoing efforts to promote sustainability with our clients and contribute to Vietnam’s efforts toward net-zero.
We are very proud to be the first bank in Vietnam to launch carbon-neutral debit and credit cards and among the first banks to launch green mortgage loans. They have been well-received by clients and the broader market alike. I don’t think I’ve ever received as many likes on my LinkedIn posts as I have for the ones on sustainability.
Aside from the sustainable finance structure of these products, they offer incentives to clients to drive the adoption of green consumer financing. For example, the green mortgage loan comes with preferential interest rates, home insurance, and other benefits.
However, the factor that seems more appealing to many clients is that when using these products, they are contributing to the sustainable development of their economy and community.
It's not a surprise that these products have gained such praise and we are about to announce more sustainable offerings very soon.