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COVER STORY

TECHNOLOGY BRIDGING

COMPLIANCE & GROWTH

Striking a balance between cutting-edge tools and sound judgment would
allow Vietnam’s banking sector to enter a future where compliance is not
viewed as a hindrance.

| By LEON PHEEK

n the bustling heart of Hanoi, the transparency, and robust risk management data. But Vietnam isn’t alone in this strug-
neon glow of startup offices pulsates practices. This regulatory overhaul, while gle, and technology, particularly in the
I with an energy reminiscent of Silicon necessary, presents a conundrum: how form of fintech and regtech (modern tech-
Valley. Here, young minds tinker with to nurture the dynamic technology ecosys- nologies to reduce the costs of regulatory
code, dreaming of disrupting industries tem amid stricter compliance regimes? compliance or the sharing of these costs
and unlocking Vietnam’s economic poten- Can technology itself be the bridge between between a number of parties), is poised
tial. Yet, just a stone’s throw away, the these seemingly opposing forces, enabling to play a vital role.
imposing facade of a State-owned bank responsible growth without sacrificing While global fintech investment dipped
headquarters stands resolute, a symbol monetary stability? in 2023 due to economic headwinds, it
of tradition and stability in the banking The answer lies not in technology alone, still reached a respectable $113.7 billion
landscape. This juxtaposition captures but in a strategic dance between awareness, across 4,547 deals, according to KPMG.
the very essence of Vietnam’s current vision, and regulation. This may be a five-year low, but experts
banking metamorphosis. One hand seeks like Mr. Karim Haji, Global Head of
to unlock the explosive potential of tech- Financial Services at KPMG International,
nology, while the other clutches the reins CAN TECHNOLOGY see a bright future. “We are entering the
of prudent regulation. BRIDGE THE GAP? next wave of fintech,” he said, highlighting
There has been a turning point in Viet- the evolving technological landscape and
nam, with the landmark amended Law shifting economic realities driving new
on Credit Institutions 2024. In an effort As the economy grows quickly, Vietnam’s opportunities for innovative startups.
to safeguard financial stability and combat banking sector faces a daunting challenge: Regtech, a younger technological solu-
systemic risks, the government mandated navigating a new regulatory landscape tion on the scene, has emerged as a crucial
tighter ownership controls, enhanced and managing a massive influx of market ally in managing compliance. Founded

en.vneconomy.vn MARCH 2024 | VIETNAM ECONOMIC TIMES | 15