"Existing innovative digital financial services for SMEs have not yet been systematically formed. Meanwhile, these enterprises always need more and more accessible financial services with low cost and a variety of products," said Bui Huy Nhuong, vice rector of the National Economics University.
Therefore, innovative financial services for SMEs need to be studied to develop not only for fintech startups but also for traditional financial institutions and technology companies.
Dr Luong Thai Bao, executive director of the Bachelor of Financial Technology Programme at the National Economics University, said that Viet Nam had a large number of SMEs, while it also has a high IT application index in the region.
SMEs face many difficulties accessing traditional financial services for production and business activities. They need special links with banks. SMEs have to bear high-interest rates, cumbersomes in banking administrative procedures, and other financial obstacles.
Meanwhile, large companies often find it much easier to access banking loans for new investments. Regarding banking services, SMEs have lost against large enterprises in accessing capital.
Bao said that due to new establishment and lack of experience and resources, SMEs could not provide adequate credit information for banking and financial services. They lack collateral, which all loans need.
Fintech startups should think about all these issues to develop, Bao said.
Banks must automate services to reduce connection costs between lenders and borrowers. They need to design suitable products for customers, ensuring the bank's benefits and customers' access to financial services.
According to Bao, with new technologies, the difficulties in the traditional financial services for SMEs can be completely solved.
The financial system should identify the needs and gaps in funding for SMEs and strengthen access to traditional banking services. It also needs to create favourable conditions for SMEs to access non-traditional funding channels and tools.
In addition, it is necessary to improve transparency in the financial market for SMEs and strengthen financial skills and strategic vision for SMEs.
According to Nhuong, over the last five years, fintech has become an inevitable trend in Viet Nam’s financial sector. It began with the establishment of fintech startups, traditional financial institutions’ provision of digital financial services, and technology companies’ entry into the area of financial services.
The fintech ecosystem in Viet Nam is developing fast and is expected to record 200 companies in 2022. Fintech businesses, traditional credit institutions, and tech firms have created a market of innovative financial services serving the development of a digital economy, he said.
However, he noted that fintech companies in the country were focusing on payment services. Their financial products and services for SMEs haven’t systematically taken shape, while SMEs always need more accessible, low-cost, and diverse financial services.
Fintech startups, traditional financial institutions, and tech firms should work out a direction for filling the vacuum of innovative financial services for SMEs, Nhuong said.
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