SBV will regulate fintech banks

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VIETNAM, April 9 –

A customer using an electronic wallet via his smartphone. Photo vnexpress.net

HÀ NỘI — The State Bank of Vietnam (SBV) has developed a sandbox for fintech banking and gathered feedback on a proposed regulation of the sector.

The SBV said the rapid development of fintech poses many challenges for financial authorities around the world as they have to tackle illegal financial activities on a new front.

Many areas, including peer-to-peer lending and data sharing through application programming interfaces, are emerging without adequate legal frameworks established, putting stakeholders at risk.

“Most of these areas have not been fully regulated, posing new risks to healthy competition, financial stability, data security and customer interests,” the SBV said.

Accordingly, the central bank should develop a controlled testing mechanism to gain first-hand experience in managing the sector and allow fintech companies to test their new products in a regulatory environment.

Notably, the SBV will enable certain risks in the sandbox to better understand the dangers, thereby creating a full-fledged legal framework that encourages innovation, prevents financial risks and promotes financial stability.

Additionally, fintech companies are required to test their products on a limited scale and under the supervision of the SBV to keep risks under control.

According to the SBV, the number of fintech companies in Việt Nam has quadrupled since 2016.

About 76% of companies cooperate with banks, 14% develop their own products and the rest are bank competitors.

BIDV has partnered with 24 fintech companies and 756 service providers to make over 1,500 financial services available to its clients.

MB and Boomerang Technology have cooperated to launch the eMBee fan page, allowing customers to check bank balances, transfer money, purchase insurance and take out loans by chatting with eMBee on Facebook Messenger.

Almost all Vietnamese banks are now rolling out e-wallets with the help of MoMo. —VNS

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