Nhtm's Retail Banking Services in the Market Economy

Enterprises can solve difficulties with credit capital. So,

Commercial banks are the bridge that brings businesses to the market and helps businesses

Enterprises can find input capital to serve production, business and payment activities

math to

create finished products for the market

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school. Commercial banks help businesses and markets

The schools are closer together in both space and time.

Nhtm's Retail Banking Services in the Market Economy

( 3) Is a tool to control the economic scope of theeconomy : Commercialbanks, on the one hand , are directlyaffectedby the government's tools . monetary policy ( market _ _

housing , mandatory reserves , yield interest , ... ) on the other hand indirectly participate in macroeconomic regulation

economy through relationships with economic organizations and individuals regarding credit and financial activities. Through commercial banks' activities with other entities in the economy, all information related to monetary policy planning will be fed back to the Central Bank, helping the Central Bank to plan macroeconomic policies. appropriate in each period to ensure economic growth and stable development.

( 4 ) Effective capital distribution betweensectorsand sectors . _ __ _ _ _ _ _ _ _ _ _ _ Commercial banks are essentially businesses, doing business for the purpose of maximizing the value of their owners' assets. They must choose businesses or projects that have the ability to collect debt and are effective for lending. Thanks to the credit screening process, capital in the economy is focused on areas with high profitability, bringing

many benefits. Fields or professions


will not accept

get capital. Thanks to these financial intermediaries, capital is effectively allocated among industries and fields.

( 5 ) Reduce costs , minimizerisks . __ _ _ _ The transfer of capital takes place directly between subjects with surplus and shortage of capital, requiring a lot of expenditure

costs for both sides: collecting and processing information, costs in time, in

In many cases, these needs are not compatible and the transaction cannot take place. In the end, such additional costs cause damage to the entire economy because of waste and loss of resources. Commercial banks as the

Financial intermediaries can minimize these costs. Commercial banks collect and hold information about a large number of people in need

about capital as well

others are ready to bow

Advance capital. It's okay

Specialization, commercial banks have technical skills to share and distribute risks. They have the ability to collect large amounts of information related to large numbers

Island different subjects, can monitor credits, reduce the

the risk of moral hazard as well as asymmetric information.

( 6 ) Supporting new technologies toimprove production efficiency ._ _ _ _ _ _ _ _ _ _ _ Commercial banks affect growth by changing the savings rate and through capital financing for businesses to expand production in both width and depth, mainly investing in technology, improve the competitiveness of businesses. Technological change is therefore influenced by the role of financial systems.

( 7 ) The activities of commercial banks contributetoimproving the quality ofthebusinessenvironment , developing businesscultureforcustomers . _ _ _ _ _ _ _ _ i c businesses . _ _ Commercial banks' deep participation in economic activities such as capital contribution, consulting... also creates positive effects for innovation in working styles.

the work of the owners


This. Commercial banks themselves are groups

operational position

Professional, with system

technology system

Modern, wide information network

everywhere. The dynamism and professional, transparent style of the banking industry helps other organizations and individuals in the economy form a professional industrial style and business culture.

1.1.2. Retail banking services of commercial banks in a market economy Concept and characteristics of retail banking services



Commercial banking is professional activities

currency, credit

applications, payments, foreign exchange, financial leasing... to meet customer needs.

Retail banking services are services performed with small-scale public customers and through branches as opposed to retail banking services.

Wholesale banking is a service

Banking for institutions

finance and

Banking services are provided in large quantities (According to the Financial Dictionary

Finance – Investment – ​​Banking – Accounting Science and Economics Publishing House in 1999)

Some researchers emphasize the role of information technology in

banking products provided. Accordingly , NHBL service is a supply _ _ _ _

banking products and services to individual individuals, small and medium enterprises through the branch network, customers can directly access banking products and services through electronic means. telecommunications and information technology” (Economist from Asian Institute of Technology – AIT)

According to WTO, “Retail banking services are the supply of products and services

Banking services reach each individual through a network of branches,

or the fact that customers can directly access banking products and services through information technology, electronic and telecommunications means"

Federic S.Mishkin 2001 “Retail banking services are banking services provided to individual individuals, small and medium enterprises, through a branch network or customers can directly access them. products

products and services”

banking through electronic media


With the strong development of the 4.0 industrial revolution associated with the terms: Artificial Intelligence (AI), Big Data or Block Chain, the strong participation of non-financial organizations and fintech companies operating in retail banking are updated according to the following concept : " Retail banking business activities are business activities " . Relying on the strong technology base of airlines , major organizations ... , to provide _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ product _ _ _

financial and non-financial service products to individual individuals, households, small and medium enterprises... to maximize convenience for customers"

According to some


in Vietnam :Service

NHBL are activities

Bank transactions serve individual and household customers.

Currently, in Vietnam, most commercial banks have completed restructuring their operating models according to their target customers: individuals and small and medium-sized enterprises (SMEs). Therefore , it can be said that Retail services are understood as _ _ _ _ _ _ _


Bank is provided

Responding to each individual and household


small and medium enterprises through traditional distribution channel networks

or electronic distribution network”.

Through the concepts of NHBL services mentioned above, it can be seen

most of

The concepts all meet at a common point: supply-oriented retail banking services

Providing services directly to consumers. In which individual customers, households and SMEs account for a large proportion. Therefore, the problem of NHBL services is to develop distribution channels, develop technology and marketing to target this large group of customers.

Synthesizing from the above concepts, according to the author: retail banking services are understood as banking services provided to individual individuals, business households, and SMEs through a network of traditional distribution channels and on the platform. technology platform.

Characteristics of retail banking services

(i) The customer base of retail banks is large and diverse in number

Large transactions but the value of each transaction is not high. Audience

NHBL service's customers are mainly individual customers and households with different incomes, educational levels, knowledge, personality, interests, age, and occupation, so customer needs are very diverse. . Since then, NHBL services have also been diverse and continuously changed to satisfy customer needs.

( ii ) The products of retail stores are diverse and rich . _ _ _ _ _ The products of NHBL services are not limited to one profession or field but spread to many different professions and fields of society. NHBL services have hundreds to thousands of types of products and services.

( iii ) Service area of ​​retail and wholesale activities . _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Because the target audience of retail banking services are individuals and households, the service area of ​​retail banking services is spread out everywhere.

( iv ) The development of retail banking depends a lot on the level of technology . _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Developing banking services requires modern technological infrastructure, because modern information technology will help banks manage better and serve customers quickly and accurately in the age of the internet and revolution. 4.0

Currently. Customers can simply transact online without having to

go to the bank. Technology is one of the ways to create added value and improve the competitiveness of products provided.

( v ) Marketing activities play an important role in the development of retail banking services : Customers of retail services are individuals and households . families, SMEs. Customer group's ability to access banking services

This is still low, especially for individual customers. Therefore, to the product

To reach customers, customers understand and use the product, promotion, marketing and after-sales care are extremely important, decisive for the existence and development of sales services. retail today. Changing perspectives on retail banking services

Differences in perspectives : In practice ,perspectives on retail banking services are still different, each different bank has a different perspective, and therefore the scopeandobjects of service provision . together. There are banks that believe that retail banking services are only service relationships with individual customers, but there are also banks that believe that commercial banking services are only a service relationship with individual customers.

NHBL services also include services for SME customers. This leads

to statistics, reports and product development plans of one

Some banks do not use the phrase retail banking but often name the service by customer or economic sector, or by business field, so the numbers and analysis of retail banking services are very different... Based on the actual situation. In fact, PhD students believe that retail banking services include services with individual customers, households and SME customers.

Differences in calculation scope :The calculation scopeof each bank's retail banking services is determined by the bank'sperspective on retail banking services .

there, old man


rather than a service object

NHBL aims to. Some


The scope of NHBL services is limited to only individual customers, while some expand to include households, and some banks also include services provided to small and medium-sized businesses.

The boundaries of activity in theretail sector are increasingly blurred. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ In the trend of integration in banking and finance, under the influence of the 4.0 revolution, the operational boundaries in the banking and finance sector in general and retail banking in particular have also undergone certain changes. In addition to banks, non-bank organizations also participate in providing service products

retail banking service


Amazon, Alipay, Facebook...). These companies with

Technology platform, available customer resources, simple and convenient transactions


is an opponent

major banks. The

compete about



not only takes place between domestic and foreign banking institutions but also takes place

out between the groups

banking and non-banking institutions.

Service provision


Banks' own retail stores will no longer exist, but only



provides technology services.

retail bank

where there is

participation of public companies

Differences in the way organizationsprovide services : Currently ,banksareaccelerating to dominate the retail market , with 3 trends:_ _ At the same time , the actorsstill continue to operate at a very stronglevel. _ _ _ _ _ _ _ _ Banks following this trend have the view that, in retail, the most important thing is still the distribution channel

The same goes for distribution and retail banks. Bank branches not only exist in big cities, but also expand in surrounding localities, industrial parks, towns and cities. In this trend, there are also banks that focus largely on developing a new, modern, technologically rich distribution channel, which is the online channel.

Trend thing

two is the

Gradually redirect from

credit to activities

non-credit activities , including activities such as collecting fees for personal and business services such as money transfer, insurance, accounting, investment consulting services, and international payments . Activities from this segment are less risky and more sustainable than credit activities. In addition, in recent times, commercial banks' cooperation with insurance is gradually becoming more popular. Banks also began to recognize insurance as a potential field, after a period of focusing too much on credit.

The third trend is for retailers to introduce technology - related retail products . _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ . Some banks allow users to transfer money between banks from ATMs. Customers can even deposit cash directly from the ATM easily. Distinguish between retail and wholesale banking services

Based on purchase characteristics and transaction value, credit services are divided

open banking services

wholesale, banking services

odd. Two types of services

These are all implemented by a commercial bank. However, in the process of implementing each type of service, the functions of commercial banks are clearly differentiated.

Wholesale service : is a focused service targeting customers who are corporations , economic groups, businesses , and large enterprises . The list of banking products of this type provided to customers is often not diverse, but the value of each transaction is often very large.

Retail service : is a service aimed at target groups of customers .

Customers are individuals or small and medium enterprises. NHBL services often focus on diversifying products to meet the needs of many people

client. Although the value of each product is not great, in return it is a very large customer base. This bank's activities are mainly mobilizing capital from all economic sectors, and lending to solve consumption problems or small and medium-scale production projects.

Commercial banks that are both wholesale and retail: Is a performing bank

Both operations work in parallel

trade and commerce

odd. This bank targets them all

types of customers from individuals, households, and small and medium-sized businesses

to corporations and large corporations. Classification of retail banking services


into professional content

of NHTM,


NHBL services include:

Retail credit services, payment services, modern banking services and other retail banking services. Specifically:

(i) Retail credit services include: Retail capital mobilization and retail lending

Mobilizing retail capital : is the act of commercial banks mobilizing capital from individuals, households and SMEs in the economy to serve the bank 's businesspurposes. The main forms of mobilization include:

Mobilizing capital from individual customers: that is people's savings deposits with term, demand and payment deposits.

Mobilize capital

SMEs: it is a term deposit

term of the

SMEs, payment deposits or current accounts of SMEs

Mobilizing capital through issuance of valuable papers: including issuance

certificates of deposit and issuance of promissory notes, bills of exchange or bonds

Retail lending : is a form of direct lending to final borrowers, mainly individuals, households and SMEs. Specifically :

Based on the subject of credit, it is divided into: personal loans, household loans and SME loans.

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