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SME Banking in Vietnam

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Nguyen Hung
Mr. Nguyen Hung the CEO of TPBank

Mr. Nguyen Hung the CEO of TPBank

Tien Phong Commercial Joint Stock Bank (TPBank) was founded on May 5, 2008 with strategic shareholders that own expertise and financial strength including: Doji Gold and Gems Group FPT Corporation, Vietnam National Reinsurance Corporation (Vinare), SBI Ven. Holdings Pte.Ltd (Singapore), International Finance Corporation – IFC (a member of World Bank) and PYN Elite Fund. With an initial charter capital of over VND 2,000 billion, TPBank has grown steadily, achieved outstanding business results and repeatedly been recognized as a prestigious financial institution as the Best Bank in Vietnam. After 10 years of operation, TPBank’s total assets have exceeded VND 127 trillion; end of 3rd quarter of 2018 profit of over VND 1.6 trillion; opening balance increases to VND 8.566 billion, number of customers reached 2.2 million.

TPBank always strives to offer the most effective banking and financial solutions and products, targeting young and dynamic segment, aiming at being the pioneer in setting trends in modern banking services and becoming the Leading Digital Bank in Vietnam. With its current technology infrastructure, TPBank has many advantages in applying advanced technology to automatically implement banking services, product development and high-technology based e-banking services. It provides a digital transaction environment with services such as: TPBank eBank, eBank Biz, TPBank QuickPay… etc. that have been appealed to customers by their convenience, quickness, safety and efficiency, developing cash-free payment habits for a large number of customers. TPBank is also the first bank in Vietnam that successfully launched model of 24/7 Automatic Bank called TPBank LiveBank, allowing customers to make almost all basic transactions as they can do at bank counter and especially customers can interact with remote tellers via video call and this model has received many positive feedbacks. In 2017, TPBank also launched TPBank QuickPay – a money transfer mobile app using QR code, bringing a variety of benefits to customers of different ages.

With such efforts, TPBank has received multiple rewards: Certificate of merit by Hanoi People’s Committee, Best Auto-Loan Product in Vietnam, Vietnam Strong Brand Award, Best Internet Bank Vietnam and Best Retail Bank Vietnam…etc. In 2017, TPBank was ranked as one of the 10 strongest banks in Vietnam by The Asian Banker and among the top 50 most profitable enterprises by Vietnam Report.

With the slogan “A deeper understanding”, TPBank desires to use the foundation of “understanding” of its customers to build a leading service quality. Understanding to share, understanding to accompany its customers to create the best and most suitable products and services that bring the highest value added. This is also the compass for a suitable development that TPBank is aiming for.

Mr. Nguyen Hung the CEO of TPBank on the occasion of winning Fastest Growing SME Bank Vietnam 2018 spoke to us about their success, the SME sector in Vietnam and their strategy for the year ahead. Congratulations on your award-winning, what initiatives do you attribute to your success?

With the slogan “A deeper understanding”, from the first days of foundation, TPBank regularly has listened to the needs of customers to bring out the best products and services. In 2018, we continue to push up business deployment, especially focusing on some of areas:

  • Develop on trade finance products and services such as: pre-delivery finance, post-delivery finance, LC import and payment and money transfer services. The number of customers using trade finance products of TPBank increased 60% and trade finance income increased by 80% compared to 2017.
  • Supply chain: A series of typical TPBank has successfully built and achieved success as Owner – Contractor – Supplier of materials – End user or Importer and assembler of cars – Showroom – End users … Thanks to the development of the chain, the number of SME customers as suppliers, distributors and end users increased fast and credit risk reduction.
  • TPBank builds credit products for SME customers. These products handle the weaknesses of SMEs who not have collateral and have difficulty to access capital from banks. TPBank approached to the needs of customers so our products grow well.

What is the SME sector like in Vietnam? What are some of the major challenges they face?

Today, Vietnam has more than 600.000 enterprises, of which more than 95% are small and medium enterprises. The number of new SMEs every year is over 120.000 Vietnamese government’s goal is to have 1 million by 2020. SMEs play an increasingly important role in Vietnamese economy, especially job solutions and increased contribution to GDP.

However, most of SMEs have newly established and developed recent years so they have some weaknesses as:

  • Power of enterprises is weak, including financial strength, market experience, human resource
  • Enterprises can’t build a stable business management system to improve their competitiveness and long-term development.

With all weaknesses, SMEs hardly compete to FDI enterprises that joined Vietnam so the number of closed SMEs each year is quite high.

As a strong supporter of small to medium-sized businesses. Can you tell us more about some of the support services you offer SMEs? How does the support offered to SME clients differ from the needs of large corporations?

As mentioned above, weakness of SMEs, especially new SMEs, is lacking in financial strength, experience and management. Deeply understanding that, TPBank has been proceed finance advisory activities, setup business management training classes, support ecommerce, online paying… to help SMEs accumulate knowledge and necessary experience on business.

Can you tell us about some of the unique partnerships you have with others to support entrepreneurs?

TPBank has been had many believable partners in supporting finance services for SMEs, one of them is IFC. We consider that IFC is a very good partner in supporting finance services for MSEs. We are also working with IFC in the following key areas:

  • IFC granted HN trade finance to TPBank so we can open high valued LC to non-accepting TPBank LC leading market or new markets not yet known TPBank and other financial institutions.
  • IFC provides short-term and long-term capital for TPBank, especially long-term capital for investment of businesses then TPBank will directly finance SME enterprises in Vietnam. The IFC’s credit limit for TPBank has been raised annually and reached a large number.
  • IFC cooperates with TPBank to provide LC confirm services to Vietnamese exporters when customers export to new high-risk markets and need a third party to guarantee.

How do you ensure customers are receiving the best customer experience available?

With slogan understanding to serve, all products and services of TPBank have been designed in detail to meet the needs of target customers. Every year, we periodically conduct customer surveys twice a year to make improvements for our services. In addition, we have some secret surveys to get more multi-view of service quality as well as customer needs.

In your opinion, what role should financial institutions take to support the social economic development in Vietnam?

Nowadays, banks are most important capital mobilization channel in Vietnam, so the role of banks is very important. Strong and stable Bank systems will importantly distribute to the development of Vietnamese economy.

In addition, banks are leading on applying digital technology of 4.0 economy on daily business. This is the source of inspiration for other enterprises to follow.

What is your strategy for continued growth and development?

For further development, TPBank will focus on:

  • Continuously applying digital technology on bank activities to improve productivities, high quality services to serve customers better.
  • Building, improving SMEs products to meet hard requires of customers.
  • Build sales force and service cultural better
  • Look for new markets, smaller markets to develop.

Interviews

Q&A with Clare George-Hilley, co-founder, Centropy PR

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Q&A with Clare George-Hilley, co-founder, Centropy PR 1

Clare George-Hilley is the co-founder of Centropy PR

Global Banking and Finance Magazine recently caught up with Clare George-Hilley, co-founder of fintech and financial services specialist PR agency Centropy, as the company toasts to three years of trading. We asked Clare about what life is like running an agency in the city, the trends she is seeing in the financial services space and what the future holds following the Covid-19 outbreak.

Why did you decide to set up Centropy PR?

I was looking for an opportunity to launch my own agency, both my husband and I had been in the public affairs and public relations industry for over a decade and we thought the time was right to go out on our own.

Clare George-Hilley

Clare George-Hilley

We could see that the financial services industry was surging, with challenger brands and new technology transforming traditional banks and setting new standards of customer service. There was a huge market opportunity to create and launch a PR agency that could provider first class comms support, alongside a deep understanding of complex regulations such as AML, KYC, and the GDPR. Likewise, many traditional technology firms are diversifying their offerings, to tap into the growing market opportunity posed by the fintech boom.

So, we worked on a business plan, designed a strategy for winning clients and officially launched in September 2017. Within a few months we had a growing portfolio of clients and a thriving business, since that point, we have never looked back!

How is Centropy doing now and what are you plans for growth?

The last three years have flown by and our client portfolio has grown and diversified quickly. We now manage PR campaigns for clients on everything from cryptocurrency, wealth management to payments and trading software.

We’ve also hosted parliamentary debates with key industry figures, including Members of Parliament (MPs) on topics such as the future of the financial services industry and the impact of challenger banks on traditional providers. The team is expanding quickly and we’re investing heavily in the latest training and support to ensure our team members are equipped to reach their full potential.

How do you see the next 12 months?

The Covid-19 outbreak has crippled the economy, forcing millions of people to work from home due to the very serious health risks. The knock-on effect of this crisis will lead to companies cutting costs where possible to save jobs, so tech will play a vital role in ensuring many businesses stay afloat.

We are already working with contactless payments specialists and other fintech companies that offer solutions to help companies survive and thrive despite the inevitable challenges ahead.

We aim to continue building our portfolio of expertise, testing ourselves with new challenges and delivering the best possible service to clients

 

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Interviews

Lessons from past recessions and advice for business owners during the coronavirus pandemic

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Lessons from past recessions and advice for business owners during the coronavirus pandemic 2

By Neil Davis, managing director and co-founder of Sterling Networks

What is Sterling Networks?

Sterling Networks is a professional organisation founded in 2014 which facilitates networking events for businesses across the Midlands, Oxfordshire, Wiltshire and the South West. Over 300 members attend our fortnightly breakfast and lunchtime meetings.”

What is your background prior to establishing Sterling Networks?

“During the 1990s, I worked in the corporate team for Halifax. My wife, Tracey, and I went onto own a manufacturing business, which was also called Sterling, and produced a range of gifts, merchandise and promotional items.

“We soon realised tradeshows were a great way to meet distributors and clients. From there, the business grew exponentially, and we managed to build a network of around 500 distributors. Eventually, we became ground down by the manufacturing business – in part because the local manufacturing sector was being devastated by competition from China – and took the decision to sell the business and relocate to Spain.

“After spending several years living abroad, we moved back to the UK to set up Sterling Integrity (EXPO’S) & Sterling Networks (Networking) We were inspired by a desire to help businesses make meaningful connections with one another, and we haven’t looked back since.”

The UK has recently entered a recession, brought about by the coronavirus pandemic. What have you learned from past recessions and how are these experiences helping you to navigate the current crisis?

“I’ve lived through a number of recessions and have seen the pain that insolvency causes companies on a large scale. It’s taught me that there are those who win and sadly those who lose, and that businesses must adapt to a rise in demand for certain products or services at a time of financial crisis.

“Given the nature of what Sterling Networks offers [an opportunity for business owners to connect and grow together] I decided we could build upon the brand due to the demand for new business during the pandemic. We therefore moved our networking events from face-to-face to virtual via tools like Zoom and have gained a steady stream of new members in recent months, reaching an overall total of well over 300.

“On top of that, we’ve taken new staff on during the crisis and have launched a number of new regional groups across the country. I was determined that Sterling should come out of the pandemic with a head start, so my attitude to the recession has been much more positive than those who are forecasting nothing but doom and gloom.

“We can’t pretend high street retail wasn’t suffering long before the pandemic came along, and thousands of new businesses are sure to start up to meet the demand for the products and services that people require at a time such as this. In order to develop and grow businesses need to focus on where changes need to be made to meet this demand.”

Sterling Networks has been providing emotional support to its members throughout the pandemic. What advice have you been giving to members that could be useful to other business owners?

“I try not to be too opinionated and respect other people’s views when giving advice to members, as there are always two sides to every circumstance. I’ve been careful not to say to people that they should be doing one thing or another, as I don’t know their business and its needs quite like they do. The only thing that I have been telling members is the importance of setting up one-to-ones with one another. By doing so, they can listen to the needs and concerns of other, like-minded business owners and work out ways that they might be able to help one another.

“The pandemic has meant we all have a bit more time on our hands, so the advice I would give to people is to use this extra time wisely. Not having to travel physically from one meeting to another means there is a greater opportunity to connect with more people. It’s important to remember that individuals outside of your business can be just as valuable as those within it.”

What makes you hopeful for the future and are there any words of encouragement you can give to budding entrepreneurs?

“The key events that have happened to this country during my lifetime – whether wars, recessions, or the pandemic – have enabled me to take stock of things. While these experiences are certainly challenging, we all become stronger for living through them, and it gives me great confidence that the world will ultimately improve as a result of the pandemic.

“The whole world is effectively rebooting right now, as is the business community. I like to think entrepreneurs will recognise this opportunity to take better care of their peers, and this translates to greater collaboration between organisations. Speak to as many people as you can, ask all the questions that you need to and do your homework. This might well be a difficult time for us all but planning for the future must start now if it is to become as prosperous as I know it can be.”

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Interviews

Exclusive Interview with Ugo Loser, CEO of ARCA Fondi SGR

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Ugo Loser, CEO of ARCA Fondi SGR

 Arca Fondi SGR is a mid-sized Italian active asset management company. Founded in 1983 by a consortium made up of 12 regional banks, the company has grown in time, expanding its network of distributors and its client base. Nowadays Arca manages Mutual Funds, Pension Funds and Institutional Accounts with total AUM exceeding 30 € bln, reaching more than 100 banks and financial institutions and serving more than 800,000 final clients.

What are the key contributors to ARCA Fondi SGR’s success over the past 35 years?

Arca has always put clients and distributors first. That is to say we have always privileged fair pricing for funds and developing high quality products and services for our customers. This requires constant innovation as an objective and looking for people’s talent to be free to produce its effect

Why are people the founding element of ARCA Fondi SGR and how have you sustained this vision over the years?

We work in small teams, people are young and motivated and can perform duties with a high level of autonomy and responsibility. Innovation is asked to everyone, everyday

What makes Arca Fondi SGR different from other asset management firms in Italy?

Arca is a company focused on doing what it can do very well, that is to say mutual and pension funds, services for clients and banks. We never follow short term trends but always look for long lasting impact on the industry, like we’ve done may times in the past

What products/services has ARCA Fondi SGR pioneered?

Arca has been the inventor of “Arca Cedola”, fixed-horizon, coupon paying funds, which have been with no doubt the greatest product innovation of the past 12 years on the Italian market. This type of funds, at first strictly based on bonds and later as a balanced product, has encountered an enormous success both with clients and distributors due to its simple and effective value proposition. Arca is a market leader also in the “PIR” segment of funds, a range of product focused on mid and small sized companies, that have been the best performers in the Italian stock market for the last few years. In services, Arca is a leader in technology applied to asset management. Our website, app and digital services for clients and banks are award winning, state of the art combination of data, technology and channels, and the best is yet to come on this side.

What strategies do you have in place to sustain your market position and withstand professional competition in the country?

As I mentioned, we do not waste resources on projects with dubious results, instead we constantly invest on people, products and services. The high level of profitability that Arca has been able to maintain even in difficult years for the markets of the banking sector is a further testimony that this strategy works very well

How do you use technology to create meaningful experiences for your customers?

First of all, we have created a whole new division, Arca InnovAction Lab, dedicated to technology, data and processes. This ensures projects are delivered quickly and they are free to leave bad past practices behind. Arcaonline.it, Arca’s website, provides distributors with detailed information on clients’ portfolios, asset under management and subscription/redemption requests. It monitors aggregate selling data offering to our partners a suite functions and analytics to track commercial campaigns. And if the banks branches need assistance, they may ask Sara, our digital chatbot. A broad and timely multimedia production, covering exclusive reports, comments, presentations, videos, webinars and newsletters is also available on the website.

Customers, subscribing Arca’s funds through its distributors’ network, may access Arcaclick, a dedicated area on Arcaonline.it. With Arcaclick the client can easily browse through her portfolio of funds, analyze its characteristics, view transactions and historical funds’ performance in customizable views. Arcaclick is also a powerful source of information on Arca product range: Prospectus, KIIDs and other literature is easily accessible along with news, comments and reports. Arcaclick may also be accessed via Arca Fondi App, a free application for mobiles and tables, running on both iOS and Android. Available 24/7 and in mobility, Arcaclick gives clients the opportunity access information, news and details of their personal portfolio anytime and anywhere.

What key trends will drive pension growth in 2020 and beyond?

The Italian market for pension funds is still very small and therefore there is a great opportunity to grow. Arca Fondi manages the biggest open ended Italian pension fund and it’s been constantly at the top of its rankings. As people and workers are looking for yield and to weather short term volatility, the pension fund is very well poised to profit from this trend.

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