Open banking has made a significant change in the banking and finance industry and offers many benefits to consumers, banks, and third-party suppliers. Could you explain what open banking actually is?

Open banking allows banks to securely share customer financial data with trusted third-party providers through digital connections known as APIs (application programming interfaces). This controlled data sharing fosters innovation and enables creation of more personalised and efficient financial services. Importantly, data is only shared when customers give their consent – ​​for example, when they agree to share data by checking a box on a terms-of-service screen.

Standard Chartered is actively driving partnerships with third-party providers from treasury management systems and ERPs like Kyriba and SAP, to trade finance platforms like LinkLogis, to bring our cash management and trade APIs closer to our customers.

How do you evaluate the readiness of Vietnam's banking system for implementing open banking compared to other markets in the region?

Singapore stands out as the regional leader and champion of open banking, underpinned by strong market maturity, proactive government initiatives, and robust infrastructure readiness. Malaysia and Indonesia follow as enthusiastic adopters – both demonstrating growing market maturity, although their regulatory frameworks are still in the early stages of development. Thailand and the Philippines are positioned as intermediaries, showing moderate progress in both regulatory advancement and market readiness. Vietnam, meanwhile, is at an earlier stage of its journey, with regulatory efforts now emerging and market maturity yet to fully develop. That said, Vietnam is making moderate progress in the open banking space and is rapidly catching up with more advanced markets in the region and globally.

Across the region, open banking adoption is being accelerated by increasing regional integration, with government efforts to boost cross-border trade and digital economy participation, as well as rapid technological advances – particularly in cloud computing, AI, and the growing use of APIs. Together, these forces are paving the way for the next phase of evolution: the shift from open banking towards open finance.

What should be prioritised when building a legal framework to support the growth of open banking, especially regarding data privacy and sharing?

Globally, countries have adopted varied approaches to implementing open banking – some are regulator-driven, others are market-driven, and some have adopted hybrid models (involving collaboration between regulators and industry participants without formal regulation).

In Vietnam, the State Bank of Vietnam (SBV) has taken a proactive and strategic approach, charting a phased roadmap to guide open banking adoption. The issuance of Circular 64 on December 31, 2024, effective March 1, 2025, marks a significant milestone, providing the legal framework and regulatory guidance to support this transformation.

In a regulator-driven model, data sharing is typically mandatory – financial institutions are required to share customer data with third parties, provided customer consent is granted. These third-party providers must register with the relevant supervisory authority and are subject to rigorous regulatory oversight. Ultimately, regulators determine the governance framework – defining who can participate, under what conditions, and how decisions are made. This ensures all participants operate within a clearly established set of rules that promote trust, transparency, and consistency across the ecosystem.

From the experience of an international bank like Standard Chartered, what is the most important element that Vietnam should focus on to operate open banking effectively?

Regardless of whether the approach is regulator-driven, market-led, or hybrid, the success of open banking ultimately depends on collaboration. Banks must build a thriving ecosystem of partnerships – engaging regulators, fintechs, and other players across the value chain – while leveraging developer portals and enhancing customer education.

Open APIs enable the secure exchange of core banking data such as account and payment information, making robust economic and security capabilities critical. Banks must therefore ensure that their API security frameworks are aligned with enterprise-wide protocols on data governance, privacy, and risk management, supported by consistent security policies across all exposed services.

Equally important is customer education. Many customers remain unfamiliar with open banking regulations and data protection frameworks, which often fuels hesitation in sharing data with third-party providers. By working closely with regulators and ecosystem partners, banks can help demystify open banking, build trust, and accelerate the journey wider towards digital transformation – especially for first-time digital adopters.

At Standard Chartered, we have established our own open banking marketplace through close collaboration with clients and partners, engaging them to shape what an ideal user experience should look like. Through this co-creation process, we not only deepened our understanding of customer needs but also helped educate and guide them on the possibilities that open banking can unlock.

The result is a suite of digital solutions designed around real business needs across a range of industries – offering modular APIs for payments, account information, foreign exchange, trade finance, and securities services. Our marketplace clients are enabled to explore, test, and prototype solutions quickly before making implementation decisions. By working hand in hand with strategic partners and platforms, we've also pre-integrated our capabilities into their ecosystems, significantly reducing implementation time – from weeks to just days.

What changes will open banking lead to in the competitive financial industry market over the next 3-5 years in Vietnam?

Open banking is transforming the financial landscape and serving as a powerful catalyst for digital innovation across the industry. By enabling secure data exchange between banks and third-party providers through APIs, it is creating new opportunities for collaboration and product development.

As its adoption accelerates, open banking is expected to drive greater competition and create a more level playing field within financial services. It will also foster innovation by allowing third-party providers to develop new, data-driven solutions that enhance accessibility, personalisation, and transparency for customers. In doing so, it will help make financial services more inclusive and easier to understand.

Beyond improving customer experience, open banking will play a key role in combating financial crime by promoting transparency, reducing cash circulation, and enabling real-time fraud detection and verification. Ultimately, by driving innovation, competition, and inclusion, open banking will contribute to a stronger, more efficient, and more resilient financial ecosystem – supporting economic growth in the process.

The impact of open banking will extend far beyond traditional banking functions such as payments or account access. As financial services become increasingly integrated into the daily lives of consumers, retailers, and businesses, banking itself may become almost invisible – instantly embedded within everyday experiences. This evolution reflects the rise of banking-as-a-service. In this rapidly transforming landscape, banks must reimagine their role – shifting their focus from viewing this transformation as a challenge to embrace it as a powerful source of new opportunities and growth.