Abstract
This paper is aimed at (i) synthesizing the impacts of FinTech on retail banking; (ii) analyzing the Vietnam FinTech and retail banking sector (iii) assessing the impacts of FinTech on retail banking of Bank for Investment and Development of Vietnam (BIDV) – the biggest bank in Vietnam in term of asset with strong digital transformation and retail banking orientation. Using secondary data and internal information of BIDV, key findings are: First, the impacts of FinTech on retail banking are mixed. FinTech's growth has promoted banking services by enhancing the flexibility and usability of financial services with lower costs and more efficient risk management. FinTech also brought various negative impacts on retail banking such as being the direct competitor in some retail market segments, cybercrime, and strategic and credit risks to banks. However, the positive impacts surpass the negative impacts. Second, Vietnam's FinTech ecosystem and retail banking sector have been significantly developed and still have much potential. Both banks and FinTechs in Vietnam realize the win-win approach in cooperation, but banks still recognize the challenges of FinTech in their retail banking operations. Third, at BIDV, the impacts of FinTech on retail banking are significantly positive, resulting from motivation to strengthen digital transformation, to utilize technologies and collaboration for higher quality services. FinTech helps BIDV to increase customers and transaction volumes, diversify products with innovative solutions and better service quality, safe transactions with cost savings. No negative impacts of FinTech on retail banking have been found at BIDV yet. Fourth, BIDV, State Bank of Vietnam (SBV) and other stakeholders should implement some solutions for better FinTech utilization in improving retail banking services and to mitigate the negative impacts in the future. Keywords: digital transformation, FinTech, financial innovation, financial services, retail banking.
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