BANKS TO PROMOTE ONLINE LENDING THROUGH NATIONAL POPULATION DATABASE ACCESS

Through a series of newly-issued regulations and access to the national population database, banks are planning to expand their online money-lending services.

Deputy Governor of the State Bank of Việt Nam (SBV) Phạm Tiến Dũng said accessing the national population database will help banks to check and authenticate new customer information more easily.

Commercial banks will promote lending services on their electronic platforms based on this database.

The draft amending the Law on Credit Institutions has many regulations specifying banking services via electronic devices.

Besides that, several provisions supplemented by Civil Law and the Law on Electronic Transactions are necessary to complete the legal framework for online lending.

Online lending, mostly small loans, has been implemented by many banks for a long time. However, this lending form has not been specified in the law. So many banks have carried out online lending with fear that the lending contract will be declared invalid in the case having a legal dispute.

In addition, due to a large amount of junk data and virtual accounts, banks are not interested in promoting online lending because of having many risks.

Since the national population database was formed, SBV has co-ordinated with the Ministry of Public Security to verify 25 million customers in the credit information database and focuses on verifying the remaining 26 million customers within the next few months.

Owning this huge amount of clean customer data is a golden opportunity for banks to promote digital services and products, especially online lending.

Allowing the banks to access the population database together with completing the legal framework on digital banking is an opportunity for the banking industry to grow strongly in the future. A solid legal corridor and clean database are the foundation to move towards all banks operating in the digital environment, said economist Lê Xuân Nghĩa.

Nguyễn Thị Kim Oanh, Vietcombank deputy general director, said the development of online lending would solve the needs of people and banks.

In the past, the banks were still cautious of online lending because the customer database still had junk information and was not authenticated.

Source: VNS