Wednesday, 5 October 2022

Techcombank improves corporate clients’ payment experience through host-to-host integration

5 min read

One of Vietnam’s largest commercial banks, Techcombank launched its host-to-host payment integration in February 2021. The implementation allows clients to transact payments in an end-to-end straight-through processing cycle.

  • Techcombank’s host-to-host project more than doubled the number of implementation deals to 54 new clients in 2021 from 25 in 2020
  • Both host-to-host payment volume and value skyrocketed in 2021 with incremental growth of 412% and 316% respectively
  • The return on investment (ROI) was 641%

Techcombank was recognised as the Best Corporate Payment Implementation in Vietnam. The bank launched its host-to-host (H2H) payment integration that allows clients’ payments to be made in a straight-through processing cycle, eliminating all the manual activities required for traditional internet banking. With Techcombank’s H2H solution, corporates can process large volumes of payment straight-through, 24/7, and in full compliance with digital security policy. After 18 months of running in project mode, from August 2019 till January 2021, the project was officially launched on 31st January, 2021. With this new channel, the bank has covered both local and overseas payment networks.

In 2021, the bank’s project team developed a comprehensive H2H integration process, standardised technical specification, as well as agile specialised team structure. These doubled the amount of H2H implementations in 2021, which increased the new clients by 116%, from 25 in 2020 to 54 in 2021. Both H2H payment volume and value have skyrocketed in 2021 by 412% and 316% respectively.

Techcombank recorded total assets say $24.5 billion in 2021, a 29.4% year-on year (YoY) increase from say $18.9 billion in 2020. De- posits from customers increased by say 13% YoY reaching say $13.5 billion in 2021 compared to $12 billion in 2020. The bank’s net income increased by say 46% YoY reaching $792.7 million in 2021 compared to say $542 million in 2020.

Challenges
The biggest challenge for Techcombank to deploy its H2H integration is understanding customers’ banking transactions and activities as they use different technologies and software providers. The bank evaluates the customer’s behavior to structure the best solutions that can integrate to different systems.

Key features
With H2H payment integration, Techombank has standardised its capability and expand the implementation of e-banking services via direct connection for customers. The growth in the number of customers, volume, and transaction value over 2020 and 2021 showcases Techcombank’s efforts in meeting the market’s demand. It was the first project to apply the agile working model which has achieved positive results. Techcombank’s H2H solution involves a specialised team in customised design, standard technical implementation and solution delivery. This has allowed the bank to implement complex solution to ts customers.

Payment features

H2H integration payment features include supporting accounts, channels, devices and certain currencies. 

Security and Fraud Management
Techcombank H2H integration is also designed to comply with anti-fraud, and security measures such as “advanced encryption standard (AES) 256, secure hash algorithm 2 (SHA-2), digital signature Rivest-Shamir-Adleman (RSA) 2048” and multi-zone, multi-layer, multi-technology protection”.

The solution to business issues
Techcombank ensured compliance with the law (Circular 39 / NHNN, Circular 84 / BTC, Circular 35 / NHNN). The bank increased competitiveness in the market through new features and products such as 24/7 instant fund transfer for low value transactions and online collection service for card transactions. The bank cooperated more closely with some important strategic partners and strengthened the bank’s brand promotion on customers’ channels. It also increased the stickiness for clients who perform automatic collection / payment with the bank, thereby supporting cross-selling and market share growth with these customers.

System scalability, project cost and scope, and return on investment (ROI). The H2H system’s percentage of real-time payment transactions has reached 98%. There are 79 clients and the estimated transaction value is VND 777 trillion ($33.9 million) while the cost per transaction is VND 600 ($0.026). The project had a high ROI of 641%. Quantifiable project objectives Techcombank’s H2H payment integration project contributes to the strategic and long-term growth of the financial institution. The project ensures compliance with recent changes of law related to the State Bank of Vietnam (SBV) and State Securities Commission of Vietnam (SSC) such as circular 39/NHNN, circular 84/BTC and circular 35/NHNN.

The project increases the competitiveness in the market through new features and products such as 24/7 instant fund transfer for businesses for low value transactions and online collection service for card transactions. The project helps the bank cooperate more closely with some important strategic partners and strengthen Techcombank’s brand promotion on customers’ channels. Moreover, the project increases the stickiness for clients who perform automatic collection/payment with Techcombank, thereby supporting cross-selling and market share growth with these customers.

 

This is a sponsored article and does not necessarily reflect the opinion of the publisher.



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