Vietnam’s Challenger Bank Timo Changes Banking Partner, Cuts Ties with VPBank
by Fintech News Vietnam August 12, 2020Vietnam’s digital banking platform Timo has warned that from September 8, 2020, existing customers will no longer be able to access their accounts at Vietnam Prosperity Joint-Stock Commercial Bank (VPBank) through the Timo app and web platform. Customers wishing to keep on using their accounts will need to deal with the bank itself and use the VPBank Online banking app instead, Timo said on August 4, 2020.
The abrupt interruption was hinted at in late July in an email communication to customers announcing Timo’s new banking partner, Viet Capital Bank (Ngân hàng Bản Việt). Though, at the time, no further details were shared, it has become now clear that Timo, a digital banking platform operated by Lifestyle Project Management Viet Nam, has officially cut ties with its original banking partner, ultimately forcing customers to choose between continuing to use its platform and open an account at Viet Capital Bank, or maintaining their existing relationship with VPBank and use the tools made available by the bank itself.
In a blog post, Timo said that though the partnership with VPBank is coming to an end, all commitments made by the bank with regards to overdraft services, credit cards services, as well as banking fees, will be maintained with their respective terms and conditions, implying that customers shouldn’t feel much difference from the switch.
Explaining the reasoning behind this change, Timo said the move was part of ongoing “efforts to implement a vision of modernizing and enhancing digital banking services in Vietnam,” with a “new and improved version of Timo.”
“In partnership with Viet Capital Bank, we will bring you a seamless and smooth banking experience, fueled by technology and innovation,” the company said in a blog post. “Timo Plus promises a private banking experience one would expect from other banks, but without the hassle of maintaining a huge balance.”
With its new banking partner, Timo is launching under the Timo Plus brand, which comes with a new website and a new mobile app that are of similar design to the original Timo app and platform.
The Timo Plus platform also features similar capabilities, including the ability to open term deposits and savings accounts, pay bills, make mobile payments, and more, and comes with a Visa credit card, instead of the MasterCard credit card previously provided by VPBank.
Timo Plus illustration, Source: timoplus.vn
VPBank has been making efforts to modernize itself and provide customers with a seamless digital experience.
Besides its involvement with Timo, the bank also launched its own digital bank called YOLO in 2018, which, in addition to standard banking services, allows customers to access services such as taxis, movies, hotel bookings, as well as food and beverage orders.
Replicating the strategy that has made Chinese tech giants Tencent and Ant Financial global fintech leaders, YOLO is pursuing the idea of providing a digital ecosystem with diversified services combined with a bank.
Regulators across Southeast Asia have been working towards opening up the banking sector to new entrants. Singapore will announce the recipients of its five digital banking licenses in the second half of 2020, while in Malaysia, regulators are planning to release the regulatory framework for digital banking in 2021.
In Vietnam, no official announcement has been made so far, implying that startups such as Lifestyle Project Management Viet Nam still need to resort to just being platform providers for now, and must partner with financial institutions that effectively hold a banking license.
Lifestyle Project Management Viet Nam has said, however, that it was aiming at “acquiring a digital banking license in Vietnam to stand alone as an independent digital bank.”
