Many Vietnamese banks have been applying Blockchain technology

Blockchain is deeply involved in the financial and banking sector

Finance – banking is one of the most strongly transformed industries under the impact of the industrial revolution 4.0, with a series of new solutions being introduced to solve many problems in transactions, payments, Trade finance, credit and loans, securities and insurance…

Among emerging technologies, Blockchain is expected to revolutionize the financial – banking industry in a comprehensive way.

According to ReportLinker statistics, the contribution of Blockchain in the banking and financial services market is expected to grow from USD 1.17 billion in 2021 to USD 1.89 billion in 2022 at a compound annual growth rate (CAGR) of 61.9%.

Sharing about Blockchain technology, Mr. Nguyen Quoc Hung – General Secretary of the Vietnam Banks Association said that, with its decentralized nature, Blockchain technology has solved many dilemmas of trust and security. Therefore, many countries around the world, including Vietnam, are looking to apply this technology to the financial and banking sectors.

According to Mr. Phan Duc Trung – Standing Vice President of Vietnam Blockchain Association, Blockchain technology challenges banks to evolve instead of negating the banking and finance industry as some people mistakenly believe.

The latest research by Boston Consulting Group shows that there are 7 major trends when applying Blockchain technology in the banking and finance industry. These are central bank digital currency (CBDC), crowdfunding (ICO), decentralized finance (DEFI, digital identity (NFT), smart contract (Smart Contract), collateralized token, etc. real estate and financial advisor (robo advisor).

Mr. Phan Duc Trung said that banks should not apply Blockchain to solve problem problems, but aim to cut costs, to create higher profits and compete with Fintech companies. .

An expert from the Vietnam Blockchain Association suggested that a bank model should be built with traditional services as the center, but sharing a different service platform with businesses based on the Enterprise Blockchain structure.

Besides, traditional banks should not consider Fintech companies as competitors, but consider themselves as the central core to build a surrounding ecosystem.

Blockchain technology application in Vietnamese banks

In Vietnam, was There are many efforts of organizations and businesses to apply Blockchain technology in the field of finance and banking.

In July 2018, TPBank and VietinBank, VIB and NAPAS successfully tested interbank money transfer transactions using Blockchain technology.

By 2019, HSBC has applied Blockchain in international payments in Vietnam market by letter of credit (L/C) transaction. Then there are 5 Vietnamese commercial banks (BIDV, HDBank, Vietinbank, MBBank and Vietcombank).

Sharing about this issue, Ms. Vu Thi Hong Nhung – Deputy Head of Wholesale Product Policy Department (Bank for Foreign Trade of Vietnam) said that in December 2020, Vietcombank successfully piloted mail transactions. Blockchain-based credit in Vietnam.

“Next, in September 2021, Vietcombank successfully applied Blockchain on VCB Digibank platform, developed VCB Rewards service – a gratitude program for individual customers.”said Mrs. Nhung.

With Mr. Tong Van Tien – Director of Outsourcing Solutions and Partnerships (IT Management Board, Tien Phong Commercial Joint Stock Bank), the top 5 applications of Blockchain in the banking sector are digital identity verification, transaction interbank services, asset trading, credit and lending, trade finance.

According to Mr. Tien, TPBank is implementing two solutions to apply Blockchain technology in business practice, not for testing purposes, namely Blockchain RippleNet international money transfer and customer point accumulation using Akachain’s solution. TPBank also researched and launched a virtual bank doing business on virtual reality technology.

It can be seen that the development potential of the Blockchain ecosystem is huge. However, the development of Blockchain technology in Vietnam still faces many challenges due to the lack of experts. In addition, people’s understanding of Blockchain technology is still limited. Vietnam also does not have any specific legal corridor for this field. These are the things we need to overcome to promote the application of Blockchain technology.

Trong Dat