GROUP ASSIGNMENT course title commercial banking TOPIC customer centricity of agribank

Banking Academy
Advanced Program

GROUP ASSIGNMENT
Course Title: Commercial Banking
TOPIC: Customer Centricity of Agribank
Instructor:

Dr. Le Hai Trung

Prepared By:

Tran Lan Anh

22A4010599

Nguyen Thi Lan Anh

22A4010494

Nguyen Khanh Linh

22A4010440

Nguyen Thi My Duyen

22A4010525

Nguyen Phuong Linh

22A4010611

Nguyen Thi Kim Lien

22A4010751

Ha Noi, tháng 12 năm 2021


TABLE OF CONTENT
I. INTRODUCE ABOUT AGRIBANK

1

1. Services and products

1

2. Distribution channel

2

3. Swot model of Agribank

3

3.1. Strengths

3

3.2. Weaknesses

3

3.3. Opportunities

4

3.4. Threats

4

4. Bank performance

4

II. The Nature of Customer-centricity (thế giới/ VN nói chung)

6

1. Customer centricity

6

2. The importance of customer-centricity with Agribank

8

III. Customer centricity in Agribank

10

1. What Agribank have done

10

1.1. Investment and development policy "Tam Nong"

10

1.2. Bringing banking services to everywhere

13

1.3. Agribank supports customers affected by Covid-19

14

1.3.1. Reduce "huge" interest to support customers

14

1.3.2. Create recovery leverage for all economic sectors

15

2. Outstanding problems

16

2.1. The weaknesses of Customer Relationship Management (CRM) system

17

2.2. Inflexible E-Mobile Banking

18

2.3. Relatively high fees

19

2.4. The attitude of staffs

21

3. Solutions and future development directions

22

3.1. Promoting abilities

22

3.2. Improving weaknesses

23

IV. References

24

CONSUMER CENTRICITY OF AGRIBANK
I.

INTRODUCE ABOUT AGRIBANK
Agribank was established on March 26, 1988 under Decree No. 53/HDBT of the

Chairman of the Council of Ministers with the name of Vietnam Agricultural
Development Bank. After that, the Bank changed its name to Agricultural Bank of
Vietnam according to Decision No. 400/CT dated 14/11/1990 of the Prime Minister.
According to Decision No. 280/QD-NH5 dated November 15, 1996, the Bank
changed its name again to the Bank for Agriculture and Rural Development of
Vietnam as it is today. On January 30, 2011, the State Bank of Vietnam (the State
Bank) issued Decision No. 214/QD-Ngan , approving the transformation of ownership
form of the Bank for Agriculture and Development. Rural Vietnam from State-owned
enterprises to one-member limited liability companies owned by the State. Agribank is
the bank in the BIG 4 banks in Vietnam. This bank is mainly invested in agricultural,
farmer and rural development.
1.

Services and products


Up to now, Agribank has provided more than 200 products and services to
corporate customers, household customers, and individuals, and to credit institutions
and financial institutions in the market, capital market, open market, interbank market.
Products and services are divided into groups, including: Capital mobilization
products; Group of domestic payment services; Card service group; Group of
international payment services; Service Group Forex Trading; Remittance Service

Team; E-Banking service group E-Banking; Treasury and money management
services group; Agency entrustment service group; Group of associated products and
services;…
Besides, service fee revenue continued to have good results; safety ratios are
guaranteed according to regulations of the State Bank. Agribank continues to affirm
the steadfastness of a brand associated with the mission of agriculture, farmers and
rural areas, always being a pioneer, the main source of credit, convenient products and
services for the economy.
In terms of network operation: Agribank's network system is very large, this is
an advantage when providing banking products and services, especially payment
services, and is a necessary basis to increase convenience. and meet the increasing
needs of customers. Currently, Agribank has relationships with nearly 740 banks and
bank branches in more than 86 countries and territories with nearly 2,300 branches
and transaction offices, the largest automated banking network (more than 3,000
ATMs, 80 CDM and over 24,500 POS machines serving over 12.6 million cards).
About the number of products and services provided in the market: Currently,
Agribank has more than 200 products and services, contributing to diversifying


products, increasing income, and meeting the needs of diverse customers. The bank
also developed strongly in insurance - banking products. Products and services for
individual and institutional customers are divided into 10 groups: Capital
mobilization, credit, domestic payment, international payment, Treasury, investment,
card, E-Banking, banking services fund and money management, meeting the best
needs of customers.
In addition, Agribank has received support from the Government and
international organizations such as the French Development Agency (AFD), the Asian
Development Bank (ADB) to sponsor many agroforestry development projects. This
is a favorable condition, providing many products and services to each object with
many incentives, ensuring the benefits between the parties.

About the brand and quality of service: The care and support for customers is
done methodically and professionally by Agribank. In particular, in 2019, Agribank
improved the quality of products and services, added utility features, implemented
24/7 interbanking, online deposit, new payment services on E-Banking, etc. partners,
and met customer needs according to market trends.
2.
Distribution channel
In addition to developing products and services, Agribank focuses on developing
distribution channels in line with the 4.0 trend. Agribank's distribution channels of
products and services are diversified including: Traditional product and service
distribution channels (2,233 branches and transaction offices, including: 158 grade 1
and 2 branches; 784 grade 3 branches and 1290 transaction offices; 7 companies).
affiliated; 03 representative offices and 01 foreign branch. Mobile transaction point);
Distribution channel via ATM and EDC/POS (2,626 ATM and 19,015 EDC/POS);
Distribution channel via Mobile Banking; Distribution channel via Internet Banking;
Distribution channel via payment connection with customers (CMS); Distribution
channel with correspondent banks (Agribank currently maintains agency relationships
with 825 banks in 86 countries and territories).
In order to increase the convenience of products and services, Agribank offers a
mobile transaction point by specialized car that provides customers with convenient
services such as: capital mobilization and lending, opening payment accounts and
registration. Sign to use the services on a payment account; domestic debit card;


domestic payment services; bill payment, collection and payment on behalf of;
payment of remittances, sale of ABIC insurance; E-Banking services and other
convenient banking services of Agribank. As of June 30, 2021, Agribank has
deployed 68 cars in 66 branches, 454 communes, with 1,622,201 customers, 17,065
transactions.
Currently, Agribank has issued more than 14 million active cards and has always

maintained its position of the Top 3 commercial banks in the market with more than
3,000 ATM/CDM, more than 24,000 POS installed and distributed across the
provinces, remote areas of the country.
Swot model of Agribank

3.

3.1. Strengths
Agribank's biggest strength is the commercial bank with the largest equity. This
bank is supported by the Government and development assistance funds of
international organizations such as ODA, AFD, and ADB to finance projects on
agricultural and rural development, industrialization of agriculture, forestry and
fishery. . This makes Agribank a particularly important position in the country's
economic development; play a leading role in the rural financial market. However,
Agribank has absolute strength in the distribution channel network. With a wide
network, Agribank has its own advantages such as: stable market share, abundant
customers. In addition, Agribank has modern information technology infrastructure,
multi-function business, multi-industry, multi-field, a large and experienced staff.
3.2. Weaknesses
The first weakness of Agribank is not meeting the minimum capital adequacy
ratio; financial sustainability is not high. Financial capacity is still weak by
international standards. Second, the branch network system in urban areas has not
been arranged and planned in a secure and effective manner. Infrastructure is not
synchronized leading to difficulties for the process of investment and perfecting high
technology. Third, products and services are not diversified, service quality has not
been paid due attention, and has not met the actual needs of consumers. Fourth, the


organizational model at the Head Office is not streamlined and effective; lack of welltrained staff to meet the requirements of the new era. Finally, Agribank is heavily
influenced by the Government, operating completely not for profit, so its competitive

advantage has not been fully exploited.
3.3. Opportunities
Nowadays, Vietnam's deeper and deeper integration into the world economy is a
great opportunity for banks, especially Agribank. The rapid development of scientific
progress will give Agribank the opportunity to raise and improve the level of science
and technology. In addition, Vietnam is an economy that always achieves high
growth, but a stable and safe environment creates favorable conditions for the
development of the bank. But besides that, the banking industry is also under a lot of
pressure to maintain its role as an important capital conduit for the whole economy.
3.4. Threats
Vietnam's economy is integrating deeper and wider into the international
economy, both an opportunity and a challenge for the banking industry in general and
Agribank in particular. Challenges when Vietnam relaxes operating conditions for
foreign banks in line with Vietnam's implementation of WTO commitments, creating
competition between domestic and foreign banks. Not only that, among domestic
banks, there is also competition between state banks and joint stock banks. These
banks are increasingly dynamic, flexible and responsive. However, products that
replace banking services are increasingly being perfected and become rivals and
heavyweights. Even within the bank itself, there are many difficulties when
implementing digital transformation in terms of synchronization and standardization
of technical infrastructure. Besides, the COVID-19 pandemic is a thermometer that
measures the "health" of the economy and the bank itself.
4.
Bank performance
The Vietnam Bank for Agriculture and Rural Development (Agribank) has just
released its separate financial statements for mid-2021. Despite operating in the
context of difficulties due to the impact of covid-19, with many synchronous and
effective solutions, Agribank has fulfilled its political mission and the role of
Vietnam's leading commercial bank. This bank is mainly invested in agricultural,

farmer and rural development, with the proportion of "Tam nong" investment
accounting for 70% of the total outstanding economy, accounting for the largest
proportion of agricultural and rural investment credit market share in Vietnam
Accordingly, at the end of the first 6 months of the year, the bank's pre-tax profit
reached VND 9,464 billion, profit after tax was VND 7,572 billion, up 40% over the
same period, ranking third in the Big4 group after Vietcombank and VietinBank. The
main reason for the positive increase in bank profits is the reduction of operating
costs, increased debt recovery to handle risks, and all business segments of the bank
are profitable.
Specifically, accumulated in the first 6 months of the year, Agribank continues to
be the leading bank in terms of total operating income with VND33,581 billion, an
increase of nearly 32% over the same period. In particular, the main contribution is net
interest income with VND 25,973 billion, an increase of 29%. Interest income
increased by 3.9% while interest expense decreased by nearly 11% compared to the
same period in 2020, helping the bank's net interest income increase sharply.
As of June 30, 2021, Agribank's total assets reached more than VND1.6 million,
up 3.4% compared to the beginning of the year and up 10.5% compared to the same
period last year. In particular, customer lending reached VND 1,232,051 billion, a
slight increase of 1.6% compared to the beginning of the year and continued to lead
the market in credit market share. Customer mobilization reached VND 1,467,071
billion, an increase of 4.2%.
In the context of Covid-19, Agribank has promptly implemented many solutions
to support and solve difficulties for customers affected by the pandemic under the
direction of the Government and the SBV, such as restructuring the repayment term,
interest exemption, fees, and new loans.
In particular, restructuring, exemption of interest and fees for 12,500 customers
with outstanding debts of VND 30,109 billion, new loans of more than VND 203,000
billion to more than 50,000 customers. Agribank also implemented many credit

programs with preferential interest rates, including: Doubling the limit of the customer
support program affected by the epidemic with the scale of VND 100,000 billion, the
interest rate, support fee up to 2.5% per year; preferential loans for small and mediumsized enterprises of VND 30,000 billion, supporting a maximum fee of 2%;
preferential loans for import-export customers of VND 15,000 billion and US$300
million; large-scale customer loans of VND 15,000 billion; consumer loans of VND
20,000 billion.
Index

6/2021

12/2020

ROE

10.17%

14.39%

ROA

0.47%

0.68%

NIM

1.6%

1.28%

C/I

3,75%

3,92%

Equity multiplier

4,62

4,725

Agribank's ROE and ROA indexes have declined compared to the end of 2020.
Agribank's ROE decreased mainly from declining ROA. Although both the difference
between deposit and interest rates (NIM) increased and the bank's ability to control
costs (C/I) flourished, the ROA decreased sharply (nearly 30%) leading to ROE also
decreased. At that time, the government asked banks to reduce interest rates to support
citizens during the COVID-19 pandemic. Agribank had also offered its own support
packages to the people, so ROA reduction is inevitable. Thus, although Agribank's
ROE decreased, it did not really affect the profitability of this bank. In the near future,
having overcome the COVID 19 pandemic, Agribank will likely grow strongly and
make more profit.


Despite the decline, Agribank's business performance indicators are still very
positive compared to the Big 4 in particular and the banking industry in general.
Agribank's return on equity (ROE), surpassing that of Vietinbank (9.75%), reached
the highest with 10.17% in the Big 4. At the same time, the profit margin on total
assets (ROA) reached 0.47% ranked second, only after 0.6% of Vietinbank. Non

performing loans (NPL) are a very important indicator in evaluating the performance
of a bank. According to statistics, the average NPL ratio in the financial statements of
Vietnamese banks is at 1.96% in 2020. In the second half of 2021, Agribank's bad
debts accounted for only 0.82% of total outstanding loans, the lowest in the Big 4
(BIDV: 1.39%, Vietcombank: 0.91% and Vietinbank: 1.38%) and decreased to nearly
0.9% compared to the end of 2020. The above indicators show that Agribank is
operating very well, the credit quality has improved significantly.
Although the business results in the first 6 months of the year are positive, it is
likely that Agribank's profit for the whole year is unlikely to increase sharply. Covid
19 is taking place very complicatedly, a series of provinces and cities must be
separated in the third quarter of 2021, causing credit to slow down, bad debts tend to
increase, the recovery of bad debts through civil proceedings and handling collateral
will also be very difficult.
II.

The Nature of Customer-centricity (thế giới/ VN nói chung)


1.

Customer centric
Customer-centricity is a business strategy that puts the customer at the center,

puts the customer first, the customer is the number one priority. Customer play an
really important role, they have direct impact on bank’s revenue. It is customer
understanding that is the foundation of customer-centricity. For banks, customercentricity is a banking practice based on trust and fairness, using customer knowledge
to meet their needs and achieve lasting relationships. , valuable, lasting.
Roles of Customer - centricity
For businesses that want to stay ahead, creating a customer-centric culture is
important. In fact, research by Deloitte and Touche shows that customer-oriented

businesses are 60% more profitable than those without a customer-oriented strategy.
Customer orientation creates a loyal customer community, which brings more
revenue to the business in the long run. According to the Temkin Group, loyal
customers are 5 times more likely to purchase, 7 times more likely to buy new
products, and 4 times more likely to recommend your company to friends or family.
In addition, customer-centricity plays a role in many other aspects:
Firstly, customer-centricity will help employees find meaning in their work,
increasing employee engagement with the business.
Secondly, the customer-centric organization has good adaptability to the market.
Changes in the market stem from a shift in customer needs and behavior. These
organizations are characterized by activities closely tied to their customer base. So
even the smallest changes are recognized quickly and strategies are updated promptly.
For example, during a pandemic, consumer behavior will shift from buying in-store to
home delivery. Customer-oriented businesses that can recognize this trend early and
promptly upgrade the quality of their website platforms and shipping services will
gain a great advantage over their competitors.
Lastly, take the customer as the center to improve skills for personnel. HR is
encouraged to interact and maintain relationships with customers in a variety of ways.
As a result, their roles will be more diverse and their skills will be enhanced not only
in expertise but also in effective customer interactions.


With customer expectations at the highest level and competition from fintech
companies waiting to claim their market share, it is imperative that banks work to
understand their customers on a direct level. and please them at every opportunity.
While technology can help a bank achieve these goals, it still needs a solid customerfocused strategy to continue growing.
Today, banks are facing significant challenges in terms of profitability and
growth. Erosion of customer confidence, slow economic recovery, and pressure from
various sources are among the many factors contributing to the current difficulties. In
the Americas, Europe, and Asia-Pacific regions, financial institutions have launched

marketing campaigns with slogans such as Banking Innovation, Restoring Trust, and
Deepening Banks. customer relationship. The goal is to make customers feel that their
banking needs are well taken care of - more "customer-centric".
In the context of the "new normal" after the Covid-19 pandemic, customer
experience is a top priority. According to the Government's plan "National Digital
Transformation to 2025, Orientation to 2030", banking is clearly a field with social
impacts, related to people every day. Accordingly, customer-centricity is a key factor
in the digital transformation race of the banking industry.
Models


The importance of customer-centricity with Agribank

2.

Customers are those who directly use the bank's products/services. The mission of
each bank is to bring the best and most useful products to meet the needs and
satisfaction of users. Customers play an important role in building a business strategy.
Banks need to base on their customer portraits to determine the goals of providing
products and care services that both satisfy customers and increase revenue.
The importance of customers to Agribank is even more evident with the goal of
maintaining the position of the leading retail commercial bank in Vietnam, performing
well the key role of providing products and services (SPDVs), convenience and
convenience, banking interests in the financial-banking sector. Especially in the Tam
Nong area, which is diversified, modern, and high-quality based on digital technology
in the direction of customer-centricity, Agribank has implemented many incentive
programs, as well as increased many products. facilities that meet customer needs.
With the motto "Rural is the market, agriculture is the loan object, farmers are the
main customers", Agribank is trying to innovate day by day in the direction of
modernity, simplifying processes and procedures, applying digital banking to serve

many conveniences for customers, especially customers in rural areas.
With a key role in the capital and credit markets for agriculture, rural areas and
farmers, Agribank's activities are really associated with villages and hamlets and close
to farmers. Agribank's capital has created new jobs, restored traditional craft villages,
contributed to restructuring agriculture and rural areas in the direction of developing
goods, industry and services... Agribank has become a companion. close friendship,
effective capital support for farmers to rise up in production and business, creating
outstanding achievements in agricultural production and new rural construction. While
commercial banks "stick to" mainly in the city, Agribank always tries to find ways to
bring banking services to rural and remote areas of the country, contributing to push
back credit. black.


Through programs, actions, improvements, and enhancement of the quality of
products and services as well as customer experiences, Agribank demonstrates its
determination to work with the banking industry to realize the National
Comprehensive Financial Strategy until the end of the year. 2025, with a vision to
2030 and the Government's projects (Development of non-cash payments for the
period 2016-2020; Improving access to banking services for the economy; Promoting
payment via banks) goods for public services); at the same time, implementing the
plan on digital transformation of the banking industry to 2025, with a vision to 2030.
III.
1.

Customer centricity in Agribank
What Agribank have done
1.1. Investment and development policy "Tam Nong"
As a bank likened to a "farmer's bank", Agribank has been making efforts to

bring banking and financial services to every village, commune, and family in rural

areas to realize a comprehensive financial strategy. nation.
Agribank always promotes the pioneering role of a 100% state-owned
commercial bank in seriously and effectively implementing monetary policy and
guidelines and policies of the Party and State, especially credit policy. serving
agricultural and rural development. By the end of 2020, Agribank has provided 1.6
million billion dong of capital for the economy, of which 70% of the outstanding
loans are for investment in agriculture and rural areas, accounting for nearly 50% of
the total outstanding loans of the bank. The entire banking industry invests in this
area.
Implementing the State's policy, each year, Agribank spends thousands of
billion dong to apply preferential interest rates to agricultural production. Currently,
Agribank is effectively implementing a number of policy credit programs and 02
national target programs on new rural construction and sustainable poverty reduction.
Agribank has supported sustainable poverty reduction for 61 poor districts with
loan turnover of over 13 trillion VND; loans under Decisions 63, 65, 68 on support
policies to reduce losses in agriculture with sales of nearly 15,000 billion dong; loans
to replant coffee with sales of over 1,300 billion dong; loans to fisheries development
policies under Decree 67 with sales of over VND 6,000 billion…


For loans for new rural construction, Agribank has provided loans to 100% of
communes nationwide with outstanding loans of nearly VND 600 trillion, of which
over 50% of new rural construction loans are for investment. Production, processing
and trading in agriculture, forestry, fishery and salt production to help raise the value
of key agricultural products; nearly 35% of investment capital for commercial
services; over 15% of investment capital to build rural infrastructure…
Through the implementation of policy credit programs, Agribank has been
making a very important contribution to the eradication of poverty and hunger,
building new rural areas, promoting the restructuring of the agricultural sector, and
creating motivation for the development of new rural areas. Agriculture plays the role

of "supporting platform" of the economy. At the same time, propagandize and
disseminate guidelines, guidelines, policies and laws of the Party and State, banking
credit policies, new technologies in production and processing, etc., contributing to
raising people's intellectual standards. people, creating absolute confidence in the
leadership of the Party and State for the development of agriculture, farmers and rural
areas.
In addition, Agribank also segments specific customer groups with different
loan levels:
For customers being individuals, households, cooperative groups, business
households, farm owners, cooperatives and unions of cooperatives according to the
following levels.
Maximum
Loans from customers

amount
(million VND)

Customers are individuals or households residing outside of
1.

rural areas with production and business activities in the

100

agricultural sector (except for the case mentioned in Point 3
of this table).
2

Customer is an individual or household residing in a rural
area

200


3
4

Customers are individuals or households investing in
industrial plants and perennial fruit trees
Cooperative groups and business households

200
300

Customers are aquaculture households, offshore fishing
5

households that have signed product consumption contracts

500

with processing and exporting organizations directly.

6

Customers are cooperatives, farm owners operating in rural
areas or engaged in production and business activities in the

1.000

agricultural sector.
The client is a cooperative for aquaculture or offshore
7

fishing, providing services for offshore fishing; aquaculture
farm owners; unions of cooperatives operating in rural areas

2.000

or conducting production and business activities in the field
of agriculture (excluding customers at point 8 of this table).
8

The client is a cooperative union of aquaculture or offshore

3.000

fishing, providing services for offshore fishing.

For enterprises, cooperatives and unions of cooperatives borrowing under the
association model: Enterprises, cooperatives and unions of cooperatives who sign
supply and consumption contracts with organizations and individuals directly engaged
in agricultural production will be considered for loans without collateral by Agribank
at the place of lending. up to 70% of the value of the project, the loan plan under the
association model. Key enterprises, cooperatives and unions of cooperatives
(hereinafter referred to as focal organizations) sign contracts to implement projects on
value chain linkage in agricultural production with organizations and individuals
Direct agricultural production is considered by Agribank, where the lender is lending,
for an unsecured loan up to 80% of the value of the project, the production and
business plan under the association model.

For enterprises, cooperatives and unions of cooperatives borrowing according
to the agricultural production model applying high technology. Customers with
production and business projects and plans in hi-tech agricultural zones or hi-tech
agricultural zones are considered by Agribank for loans without collateral up to 70%.
the value of the project or plan. Hi-tech agricultural enterprises are considered by
Agribank for unsecured loans, up to 80% of the value of projects and production and
business plans applying high technology in production Agriculture. Enterprises

that

have not been granted the certificate of hi-tech agricultural enterprises but have
projects and plans for production and business with high technology application in
agriculture that are not located in hi-tech agricultural zones or agricultural areas Hightech applications are considered unsecured loans by Agribank where lenders are up to
70% of the value of the project or plan.


1.2. Distributing banking services to everywhere
Determined to work with the banking industry to realize the National Financial
Inclusion Strategy to 2025, with a vision to 2030, and to promote electronic payments
in the public service sector, agribank focuses on improving service accessibility.

Banking and financial services to people through constant innovation in providing
convenient banking products and services and distribution channels. Up to now,
Agribank is the leading bank in modernizing rural payment channels by investing in
nearly 2,530 newly installed POS devices, developing over 200 banking utility
products and services. In order to promote the Government's policy of non-cash
payment, Agribank has implemented a scheme to develop card services in the
agricultural and rural markets since September 2019. With the advantage of

preferential support policies, simple and flexible procedures, up to now, the overdraft
limit has been over VND 1,756 billion with 266,853 cards.
Since 2017, with the approval of the State Bank, Agribank has deployed mobile
transaction points with specialized cars to extend credit and provide banking services
to production households and individuals in the area. In rural and remote areas,
creating favorable conditions for households and individuals in the process of
borrowing capital, contributing to the development of commodity production,
repelling black credit, eradicating hunger and reducing poverty, and raising incomes.


income and people's lives. Mobile transaction points by specialized cars help people in
remote areas to access banking services, reducing costs and travel time. Up to now,
Agribank's mobile transaction point with specialized cars has performed more than
15,000 transaction sessions, served more than 1.4 million customers in 454 communes
across the country, disbursed 5,679 billion VND, collected debt of 6,208 billion VND,
mobilized and saved 3,416 billion VND and provided other utility products and
services.
Sticking to rural areas, understanding the hardships and needs of the people, the
Overdraft Card Scheme as well as the initiative of Mobile Transaction Points by
specialized cars of Agribank have really brought banking services. goods to every
family.
Agribank's non-cash payment activities have contributed to changing people's
awareness and habits, especially people in rural areas, in payment activities,
improving their knowledge and skills in using payment methods. modern payment
products and services, minimizing risks in payment according to the Government's
policy on the National Comprehensive Financial Strategy. In public sector payments,
Agribank is one of the first banks to coordinate collection with Tax, Customs and
State Treasury agencies, covering communes and districts across the country.
1.3. Agribank supports customers affected by Covid-19
Agribank took the lead in reducing interest rates and reducing service fees for

customers affected by the Covid-19 epidemic. According to the report of the Credit
Department for Economic Sectors, the State Bank of Vietnam, the total amount of
reduced interest accumulated from July 15, 2021 to September 30, 2021 of four banks
is about VND 10178 billion. The results of each specific bank are as follows:
Banking

The amount of profit

Total value of debt is

Number of

has decreased

interest reduced

customers

( billions dong)

( billions dong)

( customer)

Agribank

4.885

1.27 mil

3.18 mil

Vietcomban

1.975

1.07 mil

239.384


k
BIDV

1.901

1.08 mil

365.429

Vietinbank

1.417

1.22 mil

533.392

Commitment to always be ready to provide capital to support customers to
overcome difficulties due to the impact of the Covid-19 pandemic, maintain and

continue effective production and business during the period when the economy is
trying to recover. , in the first 10 months of 2021, Agribank with a total reduced
interest for customers of VND 4,996 billion, with a total value of debt with interest
rate reduction of nearly VND 1.3 million billion for nearly 3.2 million customers.
1.3.1. Reduce "huge" interest to support customers
Agribank and 3 commercial banks in the Big4 group continue to commit to a
separate support package of VND 4,000 billion to reduce interest rates and reduce
100% of banking service fees during the isolation period for customers in localities
that are implementing social distancing measures. social isolation according to
Directive 16/CT-TTg of the Prime Minister.
Implementing Circular 01 and the Circulars on amendments and supplements
of the State Bank, with outstanding loans affected by Covid-19 at Agribank as of
October 31, 2021 at VND261,439 billion, Agribank has restructured debt, interest and
fee exemption and reduction with a total amount of VND 48,118 billion, of which:
Debt restructuring (principal + interest) is VND 45,397 billion with 15,920 customers;
Exemption and reduction of interest is 2,721 billion VND with 539 customers, the
amount of interest is exempted or reduced by 31 billion VND.
1.3.2. Create recovery leverage for all economic sectors
Agribank proactively, drastically and effectively implemented solutions to
support customers affected by the Covid-19 epidemic of all economic sectors. For the
preferential credit program of VND 100,000 billion exclusively for customers affected


by the Covid-19 epidemic, as of October 31, 2021, the disbursement of the program
has reached nearly VND 120,000 billion, the interest reduced by about 600 billion
VND. Along with that, the program continues to reduce lending interest rates for
customers due to the Covid-19 pandemic, applied to loans from 7/2021 to 12/2021. As
of October 31, 2021, the total loan balance with interest rate reduction is more than
1.1 million billion VND, Agribank has supported 3.1 million customers, with the
reduced interest amount of 4,760 billion VND.

Agribank has disbursed more than 105 billion VND with 409 customers.
Agribank also made new loans to customers affected by the Covid-19 epidemic with
sales of 383,045 billion VND, the remaining balance was 145,480 billion VND with
250,664 customers.
In addition, Agribank is still actively implementing many credit packages with
preferential interest rates with a total value of up to 270,000 billion VND and 150
million USD, including: Preferential credit program for customers FDI with scale of
5,000 billion VND and 150 million USD, accumulated loan sales so far reached 3,045
billion VND; Large customer preferential credit program with a scale of VND 35,000
billion, up to now, accumulated loan sales have reached VND 23 billion (Short-term)
and VND 95 billion (Mid-term and long-term); Preferential credit program for importexport customers with a scale of VND 15,000 billion and USD 30 million,
accumulated loan sales reached VND 3,339 billion and USD 185 million; preferential
loan program for small and medium-sized enterprises with a scale of VND 30,000
billion so far, accumulated loan sales have reached VND 582 billion with 97
customers; Consumer loan program with preferential interest rates for individual
customers in urban areas with a scale of VND 20,000 billion, accumulated loan sales
of VND 1,351 billion with 1,763 customers,...


2.

Outstanding problems
Customer-centricity is an inevitable trend for all banks because customer-

centricity is a way of banking based on trust and fairness that uses the knowledge of
customers to meet their needs and achieve sustainable, valuable, long-term
relationships. To put customers at the center, banks need to understand what
customers want, what customers need, and what factors customers care about when
using and choosing a bank's services. The customer-centricity trends of banks around
the world are mainly focused on major issues: marketing and communication, sales

and service, products and pricing, and the customer experience. The above trend
comes from research, demand survey and customer analysis. For example, a popular
survey of Canadian customers found the seven most important factors that led
customers to choose a new bank: Ads and marketing, Image, sales approach, channels,
product offerings, pricing and customer service.

As a state-owned bank and the largest bank in Vietnam, Agribank has done a great
job in building Customer Benefit Packages; marketing and promoting the bank's


image. However, up to now, there are still some issues related to price and fees of
services; impression of banking and staff; customer experiences. Without mentioning
the reasons why customers decide to choose a new bank, the IT Landscape of the bank
is such an indirect factor affecting customers, and this is also a limitation that
Agribank has not done.
2.1. The weaknesses of Customer Relationship Management (CRM) system
Customer Relationship Management is the work of approaching and
communicating with customers, managing customer information, thereby serving
customers better and establishing sustainable relationships with them. In other words,
based on data and information obtained from customers, the store will devise a
reasonable and effective customer care strategy. CRM not only plays an important
role in the business, but also contributes to helping the bank have a stronger position
in the customer's mind. This is an activity that brings a lot of practical benefits to the
bank.
Currently, Agribank's technology resources are not really rich, equipment and
transmission lines often occur errors. Limitations in CRM interface design lead to
difficulties for first-time users. Appeared in the world since the 1970s, but in the early
2000s, the application of CRM solutions really started in Vietnam. Due to the
difference in accessing time and technology, experience in building a CRM
implementation process is poor, encountering many problems in installation and

operation.
The first issue is changing the traditional work culture. Not only does an
individual have to change their work habits, but the bank also has to change the way it
operates. As people get used to the traditional way of working, switching to a new one
is a challenge that not everyone can quickly adapt to.
The second problem is the high cost. Currently, foreign CRM systems typically
have prices ranging from a few hundred to several thousand dollars per month, the


more features, the higher the price. This is not a low level, even large banks like
Agribank need to think carefully before deciding to cooperate.
The final problem is difficult support. Software from abroad will face certain
difficulties if the bank need help or repair, due to differences in time zones, languages
and long-distance so in most cases the banks will have to find their own
documentation, research and mastery practice before they start doing it.
2.2. Inflexible E-Mobile Banking
Online transactions through e-banking are now quite popular and convenient for
users. Agribank has also implemented agribank E-Mobile Banking application to
create flexibility and convenience for customers. Although the application has been
operating for quite a long time, there are also sometimes problems that make
customers unsatisfied. Agribank e-mobile banking system errors occur due to various
reasons, but most of them are from the bank. Because of the increasing volume of
customers using the service, sometimes the system is overloaded to maintain delaying
people's transactions.
Some common errors such as: Overloaded systems causing failure to log in are
affected on the customer's transaction; in some cases, customers do not even receive
OTP codes to make transactions; system errors mistakenly transferred money but did
not receive. Agribank E-Mobile Banking app also received feedback from customers
as an unfriendly interface that makes it difficult for first-time users or older people. In
addition, the slow response application causes delays, time-consuming of customers,

and the steps of operation are not optimal. A perfect example would be that each time
the customers’ login is asked to take a photo of their ID that annoys the user.
Customer dissatisfaction with Agribank's e-banking app is reflected in some
negative feedback on the App Store and Play Store. According to the evaluation on
The Play, the application only reached 3.1/5 stars, quite low compared to the
assessment of some other applications at some other banks such as MBbank, TPbank,
VPbank,... According to Anh Thu customers on the App Store, "The system is very


slow in transferring, often encountering errors. This makes me very unsatisfied, the
bank needs to upgrade to fix the system better." Another customer responded:
"Continuous maintenance application. Even though I've been transferring money for a
few days, the recipient hasn't received it yet."
The above application errors come from the weak application of Agribank's
technology. Agribank needs to improve the quality of service to meet demand and
regain the trust of customers.
2.3. Relatively high fees
When using the bank's services, customers are often interested in fees such as
account opening fees, account management fees, withdrawal fees, bank account
maintenance fees and annual fees. The types of card services that customers most
often use are domestic debit cards and credit/Visa/Mastercard cards. Compared to
other banks, the fees of services of these cards, Agribank's fee is classified as high.
While the fee for opening an account at some banks such as TPBank, VPBank or
MBBank is free, Agribank's customers have to pay an amount of 100,000VND 500,000VND to open the card. After opening an account, Agribank requires
customers to maintain a minimum balance of 50,000VND/account and pay annual
fees ranging from 10,000VND to 50,000VND depending on the card type.
For account management fees, Agribank includes 3 types of fees: SMS Banking
(10,000VND/ month for individual customers, 50,000VND/ month for corporate
customers); Internet banking (50,000 VND/ year for individual customers,
200,000VND/ month for institutional customers) and E-Mobile banking (10,000VND/

month for individual customers, 50,000VND/ month for corporate customers). These
fees are considered quite high compared to other banks, most large banks such as
BIDV, Vietcombank or Techcombank only charge one of the three types of fees.
In addition, Agribank also has BankPlus service with a monthly service
maintenance fee of VND 10,000 per account. In addition, there is also a co-owned