What awaits AI in the banking and finance sector?

By Vo Hong Diem
Fri, September 29, 2023 | 4:38 pm GMT+7

The banking and financial sectors are in a transformative period with the rapid adoption of artificial intelligence (AI), writes Dr Vo Hong Diem, lecturer in Blockchain Enabled Business, The Business School, RMIT Vietnam.

Diverse AI applications have already made their mark on the sector. Intelligent chatbots and virtual assistants are at the forefront, equipped to understand and resolve customer queries, provide tailored financial services, automate tasks, identify fraudulent activities, assess creditworthiness, and deliver automated customer support solutions.

AI's integration into the financial sector has witnessed remarkable growth. In McKinsey’s 2019 Global AI Survey, nearly 60% of financial services sector respondents indicated that they had already embedded at least one AI technology to perform structured operational tasks or detect cybersecurity risks.

Meanwhile, a survey by the World Economic Forum in 2020 revealed that 85% of financial organizations were incorporating AI technologies into their operations at the time, while 77% of senior executives anticipated AI to hold high or very high business importance in the next two years.

Following the global trend, prominent banks in Vietnam have invested in researching and implementing AI technologies in their operations.

For instance, TPBank has integrated face recognition technology into its LiveBank automatic banking channel, bolstering security and convenience for customers. VietinBank utilizes kiosks with FaceID recognition to identify customers and forward their requests to advisors.

Other banks like VietABank, Nam A Bank, VPBank, Techcombank, VIB, and ACB have embraced AI across various functions, including chatbots for customer support and engagement, asset management, security, fraud prevention, and analysis of peak season ATM withdrawals.

The incorporation of AI technology in the banking sector not only optimizes operational costs but also enhances customer support and enables efficient process automation. AI has proven highly advantageous for revolutionizing data management, customer behaviour understanding, and fostering robust customer relationships.

However, it is essential to note that most banks in Vietnam employ traditional rule-based AI, which excels in handling routine enquiries and assisting with simple financial transactions. This type of AI can only automate tasks that have been programmed into it, and its training is usually tailored for specific stationary tasks, making it less adaptable to new situations or tasks.

In contrast, generative AI possesses the ability to be trained on a wide range of data and can adapt to various situations and changes, but its application in the banking sector remains limited.

Generative AI stands as a next-generation technology that takes automation to a higher level by empowering computers to generate fresh content and ideas, moving beyond mere data processing and analysis.

The significant difference between traditional AI and generative AI is their learning and adaptive capabilities. Generative AI can process past data, learn from it, and make intelligent decisions based on this knowledge, while traditional AI is confined to performing tasks designed for it.

Generative AI can continually re-train, update, and adjust its predictions, diagnoses, and decisions in response to new data inputs. This adaptability aligns with the increasing demand for personalized financial services driven by customer preferences.

Furthermore, generative AI can access the information necessary to undertake complex tasks related to customer information, and complete simple or complex automated payments as an autonomous AI agent without human supervision.

Challeges that generative AI faces

The integration of generative AI into the banking sector in Vietnam currently faces several challenges that impede its widespread implementation.

Firstly, Vietnam lacks a solid AI development ecosystem and appropriate support policies, placing it at an early stage compared to some other Asian countries.

The high cost of AI and advanced machine learning and the scarcity of skilled labour hinder progress in the field. Currently, the supply of AI personnel in Vietnam only meets 10% of the domestic market's recruitment demand.

Moreover, generative AI's reliance on substantial amounts of high-quality data poses a significant obstacle, as data completeness, consistency, and accuracy impact model reliability and transparency. Strict data privacy and security regulations limit the data volume used for training generative AI models, making them susceptible to cyber-attacks and limiting their full potential. Inaccuracies or biases in training data can be amplified by generative AI models, leading to suboptimal outcomes.

Layered infrastructure poses another challenge for generative AI, since generative AI heavily relies on databases. However, bank data and confidential information are often subject to limited access, making it impossible for AI to perform payment tasks related to customer information and confidential information.

For greater AI integration in the future, the development of large and high-quality data becomes essential in the banking industry.

To facilitate complex tasks related to customer information, security, and seamless financial transactions, it is imperative to continue researching and developing unified AI infrastructure solutions. This would enable AI to access vital information and execute automated processes without the need for constant surveillance.

Ideally, AI will be integrated with other breakthrough digital technologies like blockchain, which offers a highly secure database for data transmission and storage, ensuring both security and transparency, and facilitating the creation of interbank databases.

Furthermore, Vietnam's AI development ecosystem and supportive policies still need substantial growth to catch up with other countries in Asia. Strategic investments in technology infrastructure, resources, and talent, including data scientists and machine learning experts, are critical for banks to retain competitiveness and stay prepared for emerging trends.

Comments (0)
  • Read More
Key factors helping firms export to demanding markets: DH Foods exec

Key factors helping firms export to demanding markets: DH Foods exec

Don’t treat business as a week-to-week or month-to-month affair. To go the distance, you must conduct business ethically, writes Nguyen Trung Dung, CEO of DH Foods.

Consulting - Thu, October 23, 2025 | 8:00 am GMT+7

Gold exchange, gold derivatives, gold ETFs proposed to be launched in Vietnam

Gold exchange, gold derivatives, gold ETFs proposed to be launched in Vietnam

Forming a gold exchange under state management in Vietnam is suitable to the reality, said Dao Xuan Tuan, head of the foreign exchange management department under the State Bank of Vietnam (SBV).

Finance - Wed, October 22, 2025 | 9:00 pm GMT+7

Real estate major Novaland wins key approval for $5 bln project in central Vietnam

Real estate major Novaland wins key approval for $5 bln project in central Vietnam

Novaland Group (HoSE: NVL), one of Vietnam’s leading property developers, has received investment approval for its flagship project worth $5 billion in the central province of Lam Dong after years of delay due to legal obstacles.

Real Estate - Wed, October 22, 2025 | 4:20 pm GMT+7

Vietnam's plastics heavyweights Tien Phong, Binh Minh report profit surges

Vietnam's plastics heavyweights Tien Phong, Binh Minh report profit surges

Tien Phong Plastic (HNX: NTP) recorded pre-tax profit of nearly VND949 billion ($36.04 million) in the first nine months of the year, exceeding its full-year target by 10.85%, while Binh Minh Plastic (HoSE: BMP) achieved record net profit of VND350 billion ($13.29 million) in Q3, surpassing its VND330 billion milestone set in the previous quarter.

Companies - Wed, October 22, 2025 | 4:17 pm GMT+7

Vietnam, Finland firms sign multiple MoUs on satellite, cybersecurity, aviation partnerships

Vietnam, Finland firms sign multiple MoUs on satellite, cybersecurity, aviation partnerships

A series of cooperation agreements were signed between Vietnam and Finland on Tuesday, within the framework of Party chief To Lam's official visit to Helsinki, while bilateral relationship was lifted to a "strategic partnership".

Economy - Wed, October 22, 2025 | 12:43 pm GMT+7

Trung Nam Ca Na seeks to convert agri-forest land for $147 mln industrial park in central Vietnam

Trung Nam Ca Na seeks to convert agri-forest land for $147 mln industrial park in central Vietnam

Industrial park developer Trung Nam Ca Na is seeking approval to convert about 170 hectares of agricultural and forest land for the construction of a VND3,875 billion ($147 million) project in Vietnam’s central coastal province of Khanh Hoa.

Industrial real estate - Wed, October 22, 2025 | 10:54 am GMT+7

PV Power's arm posts 5-fold jump in Q3 profit on margin recovery

PV Power's arm posts 5-fold jump in Q3 profit on margin recovery

PetroVietnam Power Nhon Trach 2 JSC (HoSE: NT2) reported a sharp rebound in third-quarter earnings as improved margins and higher revenue lifted profits nearly fivefold from a year earlier.

Companies - Wed, October 22, 2025 | 8:37 am GMT+7

TCBS overtakes SSI to become Vietnam’s largest securities company by market cap

TCBS overtakes SSI to become Vietnam’s largest securities company by market cap

Over 2.3 billion shares of Techcom Securities JSC (TCBS) debuted on the Ho Chi Minh City Stock Exchange (HoSE) on Tuesday. The stock, TCX, recorded the highest price and the largest market capitalization in the Vietnamese securities sector.

Finance - Tue, October 21, 2025 | 10:27 pm GMT+7

Indonesia’s palm oil industry becomes investment magnet

Indonesia’s palm oil industry becomes investment magnet

Indonesia’s palm oil sector attracted IDR52.7 trillion, or approximately $3.2 billion, in investment during the first nine months of this year, with the money going into enabling the country to capture more value out of its top commodity, the country’s Ministry of Investment reported.

Southeast Asia - Tue, October 21, 2025 | 9:34 pm GMT+7

Indonesia reports strong job, investment growth

Indonesia reports strong job, investment growth

The Indonesian Coordinating Ministry for Economic Affairs reported strong job and investment growth during the first year of President Prabowo Subianto’s administration, compared with the first year under his predecessor.

Southeast Asia - Tue, October 21, 2025 | 9:29 pm GMT+7

Singapore grants conditional approval for 1GW low-carbon power import from Malaysia

Singapore grants conditional approval for 1GW low-carbon power import from Malaysia

Singapore has granted conditional approval to import 1 GW of low-carbon electricity from the Malaysian state of Sarawak, marking a new phase in the energy partnership between the two countries.

Southeast Asia - Tue, October 21, 2025 | 9:26 pm GMT+7

Margin lending in Vietnam’s stock market hits record, but not worrisome

Margin lending in Vietnam’s stock market hits record, but not worrisome

Despite margin debt in Vietnam’s stock market surging sharply, experts believe that current margin pressure is not yet a major concern as top securities firms have significantly strengthened their capital buffers.

Finance - Tue, October 21, 2025 | 4:23 pm GMT+7

Lenders in Vietnam now in low-rate lending race: ACB exec

Lenders in Vietnam now in low-rate lending race: ACB exec

The biggest “headache” for banks in Vietnam now is that profit margins are getting thinner, said CEO of Asia Commercial Bank (ACB) Tu Tien Phat.

Banking & Finance - Tue, October 21, 2025 | 4:00 pm GMT+7

PV Gas - 35 years of innovation and technological leadership in Vietnam’s gas industry

PV Gas - 35 years of innovation and technological leadership in Vietnam’s gas industry

Over the past 35 years of establishment and development (1990-2025), PV Gas, a subsidiary of state-owned giant Petrovietnam, has affirmed its pioneering position in Vietnam’s gas industry, marked by a series of groundbreaking achievements in science and technology.

Companies - Tue, October 21, 2025 | 3:45 pm GMT+7

Vietnam's consumer finance major F88 achieves 90% of year's profit target after 9 months

Vietnam's consumer finance major F88 achieves 90% of year's profit target after 9 months

F88 Investment JSC (F88), a leading consumer finance company in Vietnam, reported a cumulative pre-tax profit of VND603 billion ($22.88 million) in the first nine months of 2025, a 2.5-fold increase year-on-year, reaching 90% of its full-year target of VND673 billion.

Companies - Tue, October 21, 2025 | 3:15 pm GMT+7

Vietnam corporate earnings to be driven by credit expansion, trading activity, property recovery

Vietnam corporate earnings to be driven by credit expansion, trading activity, property recovery

With Q3 earnings season underway, results are expected to come in broadly in line with expectations. Financials should remain the largest contributors, benefiting from credit expansion and trading activity, while real estate continues to recover as project launches and sales rates improve, writes Tung Dang, associate director at Dragon Capital.

Economy - Tue, October 21, 2025 | 2:33 pm GMT+7