The Vietnamese venture’s customers now can open personal accounts, and apply for cards and loans, all online.

The financial institution has also been awarded the titles ‘Most Innovative Financial Inclusion Strategic Partnership – Vietnam 2022’ and ‘Most Innovative Digital Bank – Vietnam 2023’ by the International Finance.

Unparalleled Range Of Payment Card Services
Back in early 2020, CIMB’s ‘Millenial Contactless Debit Card’ was the first-ever virtual debit card in Vietnam. To avail of this, all one needs to do is a simple eKYC (Electronic Know Your Customer) process through the bank’s app.

The debit card, which works all around the world, is backed by digital payment major Visa. With just one click on his/her smartphone, a Vietnamese can open his/her debit card, and the customer doesn’t need to pay any fee during the onboarding process.

The ‘CIMB Visa Debit Card’ also comes with a ‘Spend Account’, which helps the user to perform transactional activities like money transfers, phone top-ups or bill payments on the CIMB Octo application.

Talking about eKYC, users just need to take a photo of both sides of their ID cards and take a selfie to open the payment cards. Till the time the physical card arrives at the user’s doorstep, he/she can use the virtual counterpart for transactional purposes. Also, the payment cards will help the user to control his/her budget as the individual will be able to only spend within the monetary limit loaded into the account linked to the card. Money withdrawals from Visa ATMs across Vietnam will come free of cost.

In 2021, ‘CIMB-FINHAY Visa Debit Card’ comes with a ‘3 in 1’ solution, where the customer can accumulate, invest and consume the money loaded into the card in just five minutes and enjoy benefits completely free of charge.

The ‘accumulate, invest and consume’ is basically about accumulating money without term/short term with attractive interest rates, withdrawing the cash anytime and still receiving interest, free withdrawal of accumulated money to the CIMB account and free deposit from the CIMB account to Finhay account in a snap. Free annual fee/lifetime management fee, free SMS balance notification service and no requirement of minimum balance are some of the other customer-friendly features of the CIMB’s payment cards.

Availing ‘CIMB-FINHAY Credit Card’ helps the customer to enjoy up to 45 interest-free shopping days, including a 30-day statement cycle and an additional 15-day billing period. When the payment is due, the user only needs to pay the minimum monthly amount within the specified time to continue using the card the following month and maintain a good credit history. The individual can also pay the full due amount to have an additional usage limit for upcoming spending needs.

Octo App By CIMB
Be it money transfers to other Vietnamese banks or depositing cash at Vietnam Post’s transaction points, CIMB’s Octo App users can seamlessly execute online banking with just a few clicks on their smartphones. The app also saves the transfer account information for the next transfer as well.

Also, using the app, one can manage his/her payment card activities like locking/unlocking cards, changing spending limit and generating new ATM PIN. Recharging phones through the Octo app will help the customer save 2% of the recharge card value at the same time. For paying utility bills, the app saves invoice information to help the user track and pay the next time around.

The users can log in to the app using biometrics like fingerprints and facial recognition, and there is an innovative feature called ‘OctoShield’, where a new authentication method with transaction signing will ensure top-notch cyber security for the money transaction-related details.

Also through the app, one can apply for a term savings deposit, where the customer will be provided with competitive interest rates on the market, corresponding to each deposit term (ranging from two weeks to 18 months).

Key Partnerships Driving CIMB Ahead
Talking about CIMB’s business growth, in 2022 alone, the Vietnamese bank’s customer base increased by 65% on a year-on-year/quarter-on-quarter basis, compared to a similar period in 2021 and by the year-end, the venture saw a 15% growth uptick further.

CIMB’s monthly active users ratio increased from 5% in the 2021-22 financial year to 16% in the first quarter of the 2022-23 period. Overall consumer spending increased from 1.452 billion/quarter to 3.255 billion/quarter, with a 41% rise in the total transaction volume during the 2022-23 financial year.

Furthermore, CIMB partnered with ZaloPay, which resulted in the stakeholders launching their first ‘Buy Now Pay Later’ financial product. Previously, CIMB also collaborated with Finhay Debit Card and Revi Credit Card, apart from launching its ‘E-Signature’, to support its eKYC CASA solution for the partner channels.

International Finance’s annual award shows celebrate the promising talents in the fields of business and finance, supporting the idea of ‘vision meets excellence’.

In CIMB’s case, we have a financial venture, whose vision and mission is to change the digital banking game forever. Through its personalized and cutting-edge customer-focused solutions, CIMB is successfully redefining the mobile banking game.

‘CIMB Model’ is what the 21st century banking industry needs, where business growth will go hand in hand with innovation, strategic partnerships and customer-focused product creation.

The post CIMB Bank Vietnam & the art of disrupting financial space appeared first on International Finance.

Sensing that things are changing, developed countries are becoming more proactive in dwarfing the parallel growth of the fossil fuel industry. Case in point: Bank Negara Malaysia published a discussion paper on Climate Change and Principle-based Taxonomy last year which provides an overview of the crisis and its subsequent impact on the financial industry—all for the development of a national taxonomy, which is already underway in the European Union and Canada. The discussion paper stated that it will act as a guideline to ensure financial institutions in the country are ‘identifying and classifying economic activities’ that could play an important role in contributing to climate change objectives. 

Is Bank Negara Malaysia’s taxonomy inspired by other jurisdictions?

Malaysian financial regulators’ decision to develop a taxonomy stems from their observation in international markets coupled with national experiences. While developing the taxonomy, it is important for the regulators to ensure that it is fully in line with the international best practices and science-based definitions. This process is again crucial because those financial institutions and economies that do not abide by that will be left behind as the rest of the world finds a middle ground in global standards. 

In March, the European Union (EU) Technical Expert Group on Sustainable Finance published a report which comprises recommendations related to the overarching assessment and design of the proposed EU taxonomy. It is reported that the World Bank is also launching a global guide to develop a national green taxonomy on the basis of previous engagements from a host of countries. 

In Malaysia, the need for a taxonomy became more apparent during the development of Value-Based Intermediation guidelines which target sustainability financing of banks and other financial institutions while assessing transactions. In fact, local Islamic banks have observed the absence of a taxonomy in the country, which is causing a major obstacle in building up a sustainable financial system. 

The consultation paper said “Bank Negara Malaysia takes the view that climate-related risk is a risk driver that has an impact on most of the commonly known risk types such as credit risk, market risk, liquidity risk, insurance risk, operational risk and strategic risk.” In September, it was reported that 12 financial institutions will begin a pilot project to implement a taxonomy for classifying climate risks and firm up climate resilience in the country.

The proposed taxonomy receives tremendous attention 

Governor Datuk Nor Shamsiah Mohd Yunus in her speech addressing the Sustainable and Inclusive Finance Forum, said “It is also intended to facilitate financial flows to activities that support the transition to a lower carbon economy We are working with financial institutions in Malaysia to improve transparency on how climate risk considerations are being integrated into business decisions. To this end, we are progressing plans to further encourage financial institutions to adopt the Task Force on Climate-related Financial Disclosures (TCFD) recommendations for climate-related disclosure.” 

Developing a taxonomy is necessary for the country because of the value it can bring for external stakeholders to hold financial institutions accountable for their commitments toward climate risks. However, the project necessitate

s the involvement of various parties. For that reason, Bank Negara Malaysia is working closely with the Securities Commission Malaysia, the financial industry and other partners through the Joint Committee on Climate Change to  develop a collective response to climate risk management. 

The Asia Securities Industry & Financial Markets Association and its members are embracing the new opportunity to respond to the Bank Negara Malaysia and appreciate the efforts invested by the country to meet its Paris Agreement. The association in its report said “We thus urge Asia’s policymakers and regulators to work with and engage assertively in open dialogue with other jurisdictions in regional and international fora in efforts to develop a harmonised global taxonomy framework, whilst ensuring flexibility for regional specificities including the different needs of developed and emerging markets, as well as flexibility for different interpretations of sustainability provided there is sufficient transparency for informed comparisons by investors and market participants. We consider it inevitable that divergences in national taxonomies would lead to unintended consequences, in addition to creating further market fragmentation and hampering comparability of data and disclosure standards across jurisdictions.” 

The central bank is inviting feedback on its proposed taxonomy. It plans to hold discussions with banks and insurers to understand how they will adopt the new framework. The proposed taxonomy is built on five principles: Climate change mitigation, climate change adaptation, no significant harm to the environment, remedial efforts to promote transition and prohibited activities. By practice, the classification system will be divided into six tiers in response to the severity of climate change. Overall, the central bank is improvising its experience in sustainable development which includes fixed income securities with triple-A risk adjustment returns, and it is the pioneer in issuance of green and blue bonds. More importantly, it is advising governments on the development of sustainable bond markets and acting as an intermediary in disaster risk transfer transactions for countries that are adapting climate change.  

Malaysian banks buck the trend in decarbonisation 

Despite the layered efforts, three significant Malaysian banks Maybank, CIMB and RHB Bank have provided $4.9 billion in loans and bonds for coal projects in the last ten years, according to Australia’s climate activist group Market Forces. This weighs on the country’s new vision to build sustainable financing, because 45 international banks have distanced themselves from fossil fuel financing, but domestic banks are plugging the gap. It is reported that fossil fuel and greenhouse emitters always stand a chance of being financed in Malaysia, which only makes it harder for the central bank to stop coal financing. Maybank, CIMB and RHB Bank are bucking the trend in decarbonisation as they continue to finance new coal projects in Southeast Asia in a big way. CIMB, in particular, has become the country’s biggest coal financier with more than $2.6 billion in coal projects between 2010 and 2019. During that period, Maybank provided $1.8 billion and RHB Bank $435 million for coal projects. 

CIMB and Maybank have demonstrated significant interest in joining the funding collective for Jawa 9 and Jawa 10 projects in Indonesia. A report stated that the cost of developing the projects is $3.5 billion—and more importantly, the 2,000-megawatt facility has the capacity to prematurely kill 4,700 people from air pollution throughout its existence. It is worth noting that all of this comes from some of Southeast Asia’s largest banks. Market Forces in its report said “In continuing to invest in coal when other financial institutions are abandoning it, Malaysian banks are at risk of being left to prop up a dying industry.” 

The group even said that coal financing in the country shows very little signs of abating because of CIMB and Maybank collective interest in financing the controversial Jawa 9 and Jawa 10 coal-fired power projects in the country. Other activities groups like Greenpeace and 350.org have urged CIMB not to support the project. Against this background, Bank Negara Malaysia has reminded the banks that they need to step up their game in climate change, and it might require all banks to report their exposures to climate risk. 

Will big banks proactively support the taxonomy? 

In response to the central bank’s challenge to combat climate change, Malaysia banks are taking up the challenge by adopting a responsible lending policy. In addition, they will be creating more awareness among retail and business banking customers on sustainability issues. Last October, CIMB rolled out a renewable energy financing package for smaller companies in Malaysia, and it has also allocated RM3 billion for loans in sustainability projects. Even RHB bank has institutionalised its approach toward sustainability and will develop a phased approach in integrating environmental, social and governance considerations into its decision-making practices. 

CIMB has also joined a coalition of 130 international banks having a combined asset valuation of more than $47 trillion to realign their financing with sustainable development goals and the Paris Agreement on climate change. Currently, it has developed two group-wide policies, where one points to an overall sustainability while the other is focused on environmental and social risks in business lending. The bank has even reduced interest rates for clients who seek to purchase energy-efficient cars and houses, enabling them to make sustainable decisions. Even Maybank had developed a Responsible Lending Guideline to manage risks in for environmental, social and governance, which was further developed into a more comprehensive framework.

The post Malaysia won’t be the same after its taxonomy appeared first on International Finance.

Investors who took part in the funding round for Tonik include venture capital firm Insignia Ventures Partners and Credence Partners. Regional angel investors also participated in the funding round.

With regard to the fresh funding round, Greg Krasnov, founder and chief executive at TONIK told the media, “We are honored to have secured the backing of such prominent regional investors as Insignia and Credence. Over 70 percent of the adult population in the Philippines remains unbanked, and market research indicates that over 50 percent of existing bank clients would be keen to switch their deposits to a pure-play digital contender. We look forward to working with our new investors to improve financial inclusion in the country.”

Earlier this year, Tonik Financial announced that its subsidiary Tonik Digital Bank received approval from the Bangko Sentral ng Pilipinas (BSP), to provide digital banking services in the country.

Tonik is expected to go online in the Philippines this year. It claims to be the first fully digital bank in the region and one of the very few globally to be operating on the basis of its own bank licence.

To launch its digital bank in the Philippines, Tonik is partnering with Finastra to use its cloud platform to power its end-to-end core banking capabilities. Global neobanks such as Gravity and Revverbank also use Finastra’s cloud platform.

Traditional banks such as CIMB, ING and MayBank have also launched their own digital banking unit in the Philippines.

The post Tonik secures $6 mn funding to launch digital bank in the Philippines appeared first on International Finance.

Lito Villanueva, executive vice president, and chief innovation and inclusion officer at RCBC revealed that the digital bank will be called as Diskartech.

With the launch of Diskartech, RCBC will become the first Philippines-based bank to enter the virtual banking space. Currently, there are only two digital banks operating in the country- Malaysia-based financial giant CIMB Bank and Dutch lender ING Bank. Both CIMB and ING Bank launched their services earlier this year.

Lito Villanueva told the media, “It is something that I think will happen by January. In the Philippines, we have not seen any local digital bank yet offering that as a separate proposition. Everything will be on cloud, so we won’t be using the core banking of the bank, but this will be cloud-based banking.”

He also pointed out that RCBC is the first and so far, the only bank in the Philippines to be approved by the authorities to launch its financial inclusion accelerator programme across 42,000 administrative divisions in the country.

Recently, RCBC also launched its mobile application which offers three distinct services to its user. Firstly, the application offers a multi-currency foreign exchange facility supporting more than 10 currencies. Also, it offers its user the service to make timely deposits up to $200,000 and make eGov payments through PESONet and LandBank.

Earlier this year, RCBC received regulatory approval to merge its business with RCBC Savings Bank. The same was approved by RCBC’s board of members last year.

The post RCBC to launch first Philippines-based virtual bank appeared first on International Finance.