Conference looks at unlocking the power of data in banking

The Vietnam Banking Association and the IEC Group organized the Smart Banking 2023 Conference and Exhibition in Hanoi on October 6, with the theme “Harnessing, Leveraging, and Connecting Data: Shaping the Future of Banking in the Digital Age”. The event was made possible with the cooperation of EY Consulting Vietnam, the event’s Technical Collaborative Partner, which presented a series of comprehensive discussions during both the plenary and specialized sessions.

One of the specialized sessions, entitled “Sustainable Digital Transformation Strategies in Banking Based on Data”, was led by EY experts and featured guest speakers from various specialized organizations. During this session, experts delved into the pivotal role of data in shaping the future of the banking industry. They also analyzed the opportunities, challenges, and best practices in managing and analyzing input data for artificial intelligence (AI) applications that Vietnamese banks could consider implementing.

Strategy of data-driven digital transformation and hurdles banks face

In today’s interconnected world, data takes center stage in driving crucial bank decisions, streamlining operations, and enriching customer interactions. Vietnam’s banking landscape is at a pivotal moment, witnessing a surge in data digitization and operational streamlining and poised for a data-driven future.

Vietnamese banks are actively embracing digital transformation, with notable improvements in customer interactions, thanks to heavy technology investments. This push towards a data-driven future is powered by several factors. Firstly, Vietnam’s youthful and tech-savvy consumer base demands enhanced digital services. Secondly, the fintech sector’s robust growth offers efficient services that banks can integrate into their operations. Lastly, banks are increasingly connecting with other industries, requiring rapid data processing capabilities for tangible benefits.

Data-driven transformation aligns with global banking trends, yet challenges persist. Banks vary in their investments in data processing capabilities and grapple with effectively treating data as an asset. In this landscape, many Vietnamese banks may explore more intricate data-driven strategies.

 

EY’s Tech Horizon 2022 survey highlights significant hurdles in implementing data-driven strategies, including data collection challenges, a lack of structured data architecture, an absence of data strategies, data quality issues, and data availability concerns.

With data and analytics ranking as top investment priorities for 53 per cent of organizations (up from 35 per cent in 2020), addressing these challenges becomes paramount.

Leveraging AI to accelerate digital transformation in banking

Data cannot be an asset without the support of emerging technologies, particularly AI. AI utilizes a business’s data as input, and maximizes its potential when a business establishes an advanced data management system.

Mr. Sayantan Choudhury, Deputy General Director, Technology Consulting, at EY Consulting Vietnam, emphasized that the accuracy and integrity of data are the foundations for AI to provide reliable results. “To ensure that AI algorithms continue to generate reliable results, data must be regularly checked for accuracy,” he said. “To do that, banks need a robust data management and governance system.”

 

The adoption of data-driven strategies and AI in banking brings significant benefits but also ethical concerns. EY experts emphasized key considerations, including obtaining customer consent for data usage and ensuring privacy through robust security measures. Maintaining data integrity through effective governance is crucial for dependable AI. The potential for biases in AI outcomes necessitates continuous data quality management and monitoring. A well-structured governance framework is essential to address these ethical challenges and maintain accountability in AI-driven decision-making processes.

“Data is the catalyst for growth,” said Ms. Duong Nguyen, Chairwoman of EY Vietnam Consulting. “Banks have invested considerable resources in digital transformation, enhancing customer experiences and business objectives. However, the rapid development and explosion of Generative AI will usher in a completely new era for the ‘data game’. It is a time when banks need to prepare well because ‘AI brains’ will change how we communicate, serve customers, and operate banks. Furthermore, some roles in banking may even disappear, replaced by highly intelligent AI systems capable of extensive synthesis.”

The world is are entering an era of data and data analytics, where many decisions, operational processes, and business strategies of banks are determined by data, driven by new technologies and AI. Banks need to prepare diligently from now on to avoid falling behind in this new game.