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|The tie-up between CIMB and Finhay is a typical story in the embedded finance trend in Vietnam|
Most recently, CIMB and Finhay have announced a partnership to issue a co-branded card on the Finhay app. The collaboration between CIMB Bank Vietnam and Finhay has given birth to the country’s first-ever 3-in-1 bank account that can be opened and maintained straight from the Finhay app.
Finhay users will be able to open a virtual account and co-branded Debit Card right on the Finhay app with eKYC solution by CIMB to take control with all-in-one spending, saving, investment, and more. With only a bank account and debit card, users can instantly invest, save, transfer, and withdraw money for free of charge with over 17,000 ATMs nationwide.
The co-operation between CIMB and Finhay is a typical story in the embedded finance trend where banking and financial institutions co-operate with fintech firms to bring diversified benefits to customers.
Previously, MoMo also cooperated with TPBank to deploy a postpaid package, allowing e-wallet users to borrow on the app. The trend of financial institutions shaking hands with fintech is increasingly strong.
According to experts, embedded finance is expected to transform the role of traditional financial products, making it contextual, convenient, and cost-effective. Instead of making finance a stand-alone function, it will be ingrained into the lifestyle of customers, whether it is making credit available at the point of sale or providing smart advice during a customer’s life event.
In reality, there is the growing popularity of embedded finance solutions around the world. For example, Apple’s collaboration with Goldman Sachs to produce Apple Card gave the tech giant an important financial tool embedded within the Apple ecosystem.
In Vietnam, recently, Doan Van Hieu Em, CEO of the Mobile World store chain revealed a plan to develop financial utilities embedded in his system. CEO Danny Le of Masan Group also announced the development of synchronous financial utilities in their WinMart stores after acquiring this system (VinMart) from VinGroup.
Embedded finance is not entirely new. The difference now is that the internet enables a fully integrated banking experience on a massive scale. Once this experience is built, it can be infinitely replicated thanks to existing fintech infrastructures.
Embedded finance is critical because it allows for professional and safe financial operations to be directly put into any platform.
The new wave of fintech innovation may come far away from the world finance industry. Perhaps the defining shift in consumer finance will be the transition of the Big Four banks and other legacy institutions in maintaining their customer contact channels.
Thomson Fam Siew Kat, CEO of CIMB Vietnam said, “For the next generation of young and modern consumers, banking will be something that you 'do' with your favourite brands rather than your chosen bank. Consumers and businesses will no longer see banking as a separate sphere or sector, and will instead come to expect that day-to-day financial tasks will be carried out within their favourite brand ecosystems. And if you’re a traditional bank, it’s time to start gearing up for a battle of your own – one that isn’t necessarily going to be on home turf.”
On the same note, Nghiem Xuan Huy, CEO of Finhay said, “In the world, embedded finance help people seamlessly and easily transfer funds from an account or any stored value account into something that is able to get profits in the market. This enabled banking activities to be built into almost other industries. There are relatively attractive changes in the embedded finance in the market. I don’t know how long that trend is going to go on, but it’s something that we’re starting to see demand for.”