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Payment habits now moving towards more efficient means

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3 weeks ago

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AI has become increasingly popular in the banking industry. Tim Evans, CEO of HSBC Vietnam, talked with VIR’s Hong Dung about how AI will drive banks forward.

Thanks to swift changes in the economy and new tech trends, the banking industry in 2025 will unlock more opportunities but also face issues with consumer power, deposits, revenues, credit quality, and risk management. How do you think technology can support the industry in facing these challenges?

Payment habits now moving towards more efficient means
Tim Evans, CEO of HSBC Vietnam

Technology is present in all aspects of the banking industry, not only in operations, but also helps lenders know more about their existing and prospect customers, anticipate opportunities, and capture them when they come. Therefore, the factors you mentioned can be considered opportunities rather than challenges. Thanks to the fast-growing development of technology, banks can communicate with customers through power natural language models applied in virtual assistants, providing more updated information in a convenient way.

From end users’ perspective, internet banking has achieved a big jump. Young Vietnamese tend to use digital platforms in payments, transfers, and deposits, etc. According to the State Bank of Vietnam (SBV), some lenders process more than 95 per cent of their transactions on digital platforms. Cashless payments have been continuously increasing in both volumes and values.

Currently, all of our corporate customers transact online, while we record a majority of retail customers prioritising internet banking and apps. Technology helps lenders keep up with the market’s needs and preferences, resulting in more business opportunities and revenues. AI is an effective assistant in credit quality and risk management. As early adopters of new technology, banks use AI to produce synthetic data to train models behind e-verification processes, making them more efficient.

Research indicates that AI could boost banking revenue worldwide by up to 9 per cent in 2025, reaching $2 trillion in 2028. How does this pertain to Vietnam?

AI is the key word in recent years, and especially after the launch of DeepSeek, the outlook in which AI is more affordable for everyone seems more realistic. Vietnam owns advantages for AI development, such as a tech-savvy population that is curious and willing to welcome innovations. The government has big ambitions for technology transformation too.

However, statistics from the National Cyber Security Centre’s portal for security reporting recorded 16,000 reports of online fraud cases, causing a loss of $15.6 billion – an equivalence of 3.6 per cent of GDP, with 91 per cent related to fraud in the banking and finance sector. This vulnerability of customers to fraud is partly attributed to data breaches and cybersecurity threats targeting financial organisations, potentially resulting in customer data falling into the wrong hands.

This raises concerns about data privacy and the ethical and responsible management of AI, since it collects and analyses huge amounts of customer data daily. What would happen if this information was leaked and used for bad intentions? To address these challenges, banks commit to transparency in data collection, processing, and sharing practices, ensuring that the purpose and process are transparent.

All data collection activities serve a one-and-only purpose: providing customers with tailored solutions that meet their needs best. It is imperative for financial institutions to establish a robust personal data retention and security system alongside data privacy control systems and risk management frameworks to safeguard customer data effectively. In the long term, investing appropriately in privacy-enhancing technology will be key to protecting against potential threats in the future.

According to Vietnam’s cashless payment strategy, by the end of 2025 its value will be 25 times higher than GDP. In your opinion, how AI assist in this process?

That requires the collective and long-term efforts that I believe banks in Vietnam have been striving for through the years. We have achieved a big forward step to transform how people transact daily. In the first 11 months of 2024, cashless payment transactions increased by 56.86 per cent in volumes and 33.73 per cent in values, according to the SBV.

To keep that momentum, banks continue to upgrade their digital services, creating seamless, secure and convenient methods for customers. As mentioned, technology and AI are good factors that contribute to this breakthrough journey. Cooperation and best practice sharing between banks in applying AI, developing digital services will turn to bigger benefits for our customers.

Vietnamese people still often withdraw much cash at year-end, for their Lunar New Year spending. Do you think this habit will gradually change with electronic lucky money, for example?

This is the sixth year I have lived and worked in Vietnam, which has helped me witness some of the beautiful Vietnamese traditions during Lunar New Year. People tend to send money to their families or parents before the holiday break, and the elderly also sometimes give lucky money to children in red envelopes as best wishes for the New Year. I think this tradition will live on.

Nevertheless, thanks to the effects of Vietnam’s financial inclusion in recent years, people now prefer to make transactions online. Transactions through the National Payment Corporation of Vietnam in early 2025 increased 13-15 per cent on-year. The local media also stated reduced numbers of people withdrawing cash at ATMs before Tet as previous years. Vietnamese people’s habits are changing.

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Real estate capital heading into suburban areas

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5 hours ago

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March 12, 2025

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The shortage of affordable apartments in Ho Chi Minh City has led buyers with tight budgets to seek properties in neighbouring markets.

The real estate market in Ho Chi Minh City is facing a scarcity of land, while the cost of project development is continuing to rise. This has forced investors to carefully consider which product segments to focus on to ensure profits.

Real estate capital heading into suburban areas
Photo: baodautu.vn

Investors with land in strategic locations close to the city centre are prioritising the development of mid-range and high-end products to optimise financial outcomes.

As a result, buyers seeking affordable options are being forced to look elsewhere.

“The shortage of affordable apartments in Ho Chi Minh City has led buyers with limited finances to seek items in neighbourhoods like Binh Duong, Dong Nai, and Long An. In these areas, apartment prices hover at around $1,200-$1,600 per square metre, creating strong demand,” said Giang Huynh, head of research and S22M at Savills Ho Chi Minh City.

From another perspective, the average rental yield for apartments in Binh Duong is currently 4.7 per cent, well above the 3.7 per cent yield in Hanoi and 3.6 per cent in Ho Chi Minh City.

Dinh Minh Tuan, southern regional director of real estate trading platform Batdongsan.com.vn, shared that the high rental yield in Binh Duong is largely due to reasonably priced luxury apartments, with high rental prices and stable occupancy rates.

On average, a luxury apartment in Binh Duong can be rented for $400-$480 per month for a one-bedroom unit, and from $600-$800 for a two- to three-bedroom unit.

Meanwhile, in Ho Chi Minh City or Hanoi, apartments in the $1,800-$2,000 per square metre range can only be rented for around $280-$480 per month, depending on the number of bedrooms, not to mention the increasingly stiff competition in enticing tenants.

In response to the strong capital shift, real estate firms in Ho Chi Minh City’s suburban areas are accelerating legal procedures to launch new projects.

This trend reflects the investors’ agility and creates attractive opportunities for both homebuyers and investors in 2025.

Accordingly, Kim Oanh Group plans to launch a 27-hectare urban area in New Binh Duong City in the first quarter of 2025.

This will be the first project the company has collaborated on with Surbana Jurong, a partner from Singapore, under EDGE green standards.

The project features 1,656 townhouses and terraced houses, and 1,666 social apartments, priced from $28,000 per unit.

Major developer Phat Dat Real Estate Development Corporation plans to launch two major projects, Thuan An 1 and 2 in Binh Duong province, covering a total area of 4.46 ha.

The 1.8ha Thuan An 1 will provide 2,604 apartments and shophouses, while the 2.66ha Thuan An 2 will have 3,270 apartments and 16 townhouses. These projects are located on key roads.

Simultaneously, southern developer An Gia Group plans the launch of 3,000 apartments at The Gio Riverside and 76 shophouses in Di An city.

The three-hectare project, located on the provincial route DT16, offers nicely designed apartments with one to two bedrooms.

Regarding opportunities for homeownership, Phan Cong Chanh, an expert in real estate investment, noted that owning a home requires solid knowledge and time to raise financial resources.

For young people, buying a home immediately is a challenge due to limited finances.

Buyers can explore financial support packages and use leverage to shorten the time needed to purchase real estate. This needs to be accompanied by a reasonable plan to ensure long-term affordability.

“Overall, owning a home is not just a purchasing decision; it also requires a smart financial strategy. Whether choosing to buy immediately, rent, or invest in real estate in any segment, individuals must consider their financial conditions and personal plans carefully,” said Chanh.

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VinFast looks to long term with operational roadmap

Published

7 hours ago

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March 12, 2025

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Carmaker VinFast aims to become a powerhouse in the electric vehicle market as it grapples with tougher competition abroad.

VinFast looks to long term with operational roadmap
The company wants to double EV sales when compared to last year’s figure

Potential investment from JTA Investment through an MoU between Vingroup and Qatar Investment Fund, which was unveiled last week, aligns perfectly with VinFast’s ambitious vision of scaling up production and sales in a competitive international market, the company said.

JTA Investment is exploring a potential equity investment of at least $1 billion in VinFast, the Nasdaq-listed EV manufacturer, as well as a strategic partnership aimed at supporting the company’s global expansion and technological development.

“This collaboration will unlock significant opportunities for Vingroup and its subsidiaries to drive technological, infrastructural, and sustainable economic advancement in Vietnam, while establishing a foundation for international expansion,” said Le Thi Thu Thuy, vice chairwoman of Vingroup.

Global electric vehicle (EV) competition is expected to get tougher as the demand for EVs is projected to increase further this year, but the outlook is being hindered by uncertainty surrounding tariffs and policy changes.

In 2025, S&P Global Mobility projects that 15.1 million battery EVs will be sold worldwide, a 30 per cent increase on last year. It is anticipated that 16.7 per cent of the light vehicle market will be made up of battery-based EVs.

S&P also reported that major unknowns await Chinese manufacturers BYD and Tesla in 2025 due to assumed changes to the US Inflation Reduction Act.

Last year, VinFast stated that it was delaying the opening of its North Carolina factory until 2028, which will allow the company to optimise its capital allocation and manage short-term spending more effectively, focusing more resources on supporting near-term growth targets and strengthening existing operations.

The company is expanding its strategy in India, Indonesia, and the Philippines, where EV infrastructure is developing rapidly but competition from domestic brands is limited. Experts said that in order to sustain long-term growth, it needs to compete with Chinese manufacturers and prove its competitiveness beyond its home market.

VinFast is scheduled to open factories in Subang, West Java and in the southern Indian state of Tamil Nadu this year. The plan to expand into India aims to seize growth opportunities in the world’s most populous nation and rapidly expanding EV market.

On February 28, VinFast and Motech Automotive Service Centres, through its franchisor and operator in the Philippines, signed an MoU on expanding the service network for VinFast’s EVs in the market. The agreement aims to meet the increasing demand for EVs among Filipino consumers, while affirming VinFast’s long-term commitment and determination to utilise green transformation across the region.

VinFast and Motech will collaborate to accredit over 60 Motech service workshops as approved VinFast service centres. In the Philippines, these service centres will have the authority to handle VinFast EV maintenance, warranties, and repairs. This year, VinFast intends to open over 100 similar service workshops throughout the Philippines.

In 2025, the company has set the ambitious target of doubling sales to around 200,000 EV globally after announcing impressive results in 2024, with 97,300 EVs sold globally, of which about 87,000 vehicles came from the domestic market.

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M&As in crucial sectors poised for rapid expansion

Published

9 hours ago

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March 12, 2025

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Following the downturn, Vietnam’s merger and acquisition landscape is set to gain momentum in 2025, driven by spearhead industries from technology to manufacturing. Julien Curtet, partner of Index Partners, shared with VIR’s Thanh Van his insights into the overview and the prospect of the market.

How do you see Vietnam’s merger and acquisition (M&A) market affected by global market volatility?

M&As in crucial sectors poised for rapid expansion
Julien Curtet, partner of Index Partners

In 2024, global M&A activity rebounded, reaching approximately $3.5 trillion (a 15 per cent increase from 2023) with around 7,500 deals above $30 million. Corporate acquisitions rose by 12 per cent, and financial investor activity surged by 29 per cent, driven by private equity amid easing interest rates. Key sectors included technology, energy, financial services, and telecom.

Vietnam mirrored global trends with notable M&A activity in technology, energy, and industrial sectors, supported by a resilient macro and rising foreign investment.

In 2024, Vietnam’s M&A market experienced a downturn in transaction value, influenced by global economic uncertainties stemming from geopolitical tensions and currency fluctuations. However, deal volume reached around 160 transactions in the second half of 2024, marking a 25 per cent rise from the first half of 2024 and a 32 per cent jump from the second half of 2023, signalling a strong recovery trend and positive momentum for future growth. Some key deals in the second half of 2024 were Masan’s acquisition of an additional 7.1 per cent stake of VinCommerce from SK Group for $200 million, KIDO’s acquisition of Hung Vuong, Nvidia’s acquisition of VinBrain, and SK Group’s $300 million acquisition of Iscvina Manufacturing.

Mid-cap deals up to $25 million dominated Vietnam’s M&A market, accounting for just over half of total deal volume despite a 28 per cent drop in total transaction value. Mid-size transactions in the second half of the year included ADA’s acquisition of Customore and Elan’s $8.89 million acquisition of TMC Vietnam.

Could you shed light on some key drivers for the Vietnamese market in 2025 and beyond?

In 2025, it is set for strong growth, driven by key sectors such as infrastructure, technology, consumer, and manufacturing. Infrastructure will see a surge in investment, particularly in transportation and logistics, supported by government initiatives.

The technology sector is poised for rapid expansion, fuelled by favourable policies and accelerating digital transformation. Consumer spending is expected to rebound from a low base, signalling a recovery in the consumer sector.

Meanwhile, the manufacturing sector, which contributed over one-quarter of GDP in 2024, is projected to grow by 10 per cent in output, supported by new industrial zones and increased foreign investment.

The market is set to accelerate in the second half of 2025, fuelled by stable global interest rates and rising investor confidence.

Vietnam’s strong economic momentum, pro-investment policies, and booming sectors like technology, manufacturing, infrastructure, and recovery of consumer will drive deal activity, cementing its status as a key M&A hub in Southeast Asia.

How do foreign dealmakers approach strategies amidst global economic uncertainty, especially tariffs and new US policy?

Foreign dealmakers are reshaping their M&A strategies. Despite the challenges, Vietnam remains a key destination for cross-border investment, driven by its rapidly expanding technology, consumer, and manufacturing sectors.

Vietnam is rapidly advancing its technology sector, emerging as a significant player in the global digital landscape. Its commitment to technological innovation is evident through key partnerships, such as the collaboration with Nvidia to establish AI research and data centres in the country.

To further entice high-tech investments, the government offers substantial incentives, including up to four years of tax exemptions and a 50 per cent tax reduction for the subsequent nine years, as well as financial support from national sci-tech development funds.

Additionally, Vietnam’s consumer market is expected to recover in 2025, fuelled by a rising population, and increasing disposable incomes, boosting demand for goods and services. With consumer confidence rebounding and spending accelerating across sectors, Vietnam’s consumer market is regaining momentum as a vital driver of economic growth.

Vietnam is emerging as a manufacturing and logistics hub, attracting foreign investments due to its competitive labour costs (20–50 per cent lower than regional peers) and a 9.8 per cent increase in manufacturing output in 2024. An “anything but China” strategy is driving multinationals to shift production to Vietnam.

The country is also benefiting from major infrastructure projects, including the Long Thanh International Airport and deep-sea ports in Haiphong, are strengthening its logistics position, while expanding industrial areas and cross-border e-commerce fuel growth in both sectors.

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