Contribution Ratio of Card Lines to Overall Card Business Results

As of December 31, 2019, BIDV's total network of operating points was 1,073 points, including: 193 branches, 880 transaction offices - ranked 4th in the Commercial Banking system in terms of the number of network points and increased by 13 branches and transaction offices compared to 2017. This shows that BIDV has really focused on and demonstrated its determination to closely follow the strategy of developing retail banking business activities according to the policy of the Board of Directors.

Regarding growth rate: the period 2015-2019 had strong growth in the network system with an average growth rate of 7.3%, in which 2015 had a strong acceleration in the network system with a rate of up to 27.6%, this was due to the merger and restructuring of 44 branches and 200 transaction offices of MHB into BIDV.

Regarding the payment network system, BIDV is the first bank in Vietnam to expand its ATM network to 63/63 provinces and cities nationwide with a total of 1,901 ATMs. The number of transactions and transaction turnover via ATMs have grown at a high rate each year. The ATM/POS system has been connected to the Banknet, SmartLink and VNBC alliances, the three largest ATM alliances of commercial banks in Vietnam, so that BIDV's ATM network can now accept Visa Card, Master Card and domestic debit cards from most commercial banks in Vietnam. BIDV also provides value-added services on ATM cards, including payment of electricity and telephone bills, prepaid account payments, insurance premiums and airline payment services. BIDV has expanded its acceptance of Banknetvn cards and USD payment transactions via POS across the entire system for 10 years.

2.2.6. Product and service system:

During the period 2015 - 2019, the entire system has made efforts to deploy new retail products, contributing to diversifying BIDV's product portfolio, increasingly meeting customer needs.

- Retail credit products : Continue to standardize TDBL products to complete BIDV's system of retail credit products including: Production and business loans, Consumer loans, Mortgage loans, discount loans, Securities loans

Loans, Home Loans, Auto Loans, Unsecured Consumer Loans, Study Abroad Loans.

- Deposit products: To meet the fierce competition in capital mobilization activities, during the above period, BIDV has deployed a series of new products with diverse features and terms, meeting the needs of different customer segments such as: Payment deposits, term deposits, securities trading deposits and specialized services, account packages, etc.

- Payment products: Deploy diverse payment services: VnTopup top-up; postpaid bill payment, online payment; e-wallet top-up and withdrawal links, value-added tax refund for foreigners.

- Card services: Increase utilities to enhance the experience for each customer segment with 03 card lines including 18 different types of cards such as: international debit cards with 05 types of cards, domestic debit cards with 04 types of cards, international credit cards with 09 types of cards, POS and ATM, in which domestic debit cards contribute an average of 77.5%, international debit cards contribute 2.7%, international credit cards contribute 11.2%, Pos contributes 3.3%, ATM contributes 5.3% to the overall card business results income structure.

Table 2.7: Contribution ratio of card lines to overall card business results

Status

Card	2015	2016	2017	2018	2019	Average
1	Domestic debit	76	76	77	78	79	77.5
2	International debit	3	3	3	3	2	2.75
3	International credit	13	13	12	9	11	11.25
4	POS	2	2	1	3	7	3.25
5	ATM	6	6	6	4	5	5.25
	Source: [14]

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- Online banking service : Helps customers easily look up and manage personal accounts including 04 main subsystems: Mobile banking; BIDV online, ATM service and transactions using new technology...

- Electronic banking services:

E-banking activities continued to develop strongly in the period 2015-2019, by the end of 2019: the number of customers transacting via e-banking channels reached 10.5 million customers, an increase of 14% compared to 2018, especially in 2015 the highest growth rate reached 53%, the average growth rate was 32.8%;

Table 2.8: Results of e-banking services at BIDV

Status

Target/year	2015	2016	2017	2018	2019	Jar army
1	Number of customers (orders) position: million)	4	5.7	7.7	9.2	10.5	7.4
2	Customer growth rate	53%	43%	35%	19%	14%	32.8%
3	Number of transactions (unit: million)	18	20.0	44.0	82.3	150.0	63
4	Transaction volume growth rate	20%	11%	120%	87%	82%	50.2%

Source: [14]

Along with the number of customers, the number of transactions via electronic banking channels has an impressive growth, the average growth rate in the period 2015-2019 reached 50.2% with the total number of transactions in the above period reaching 257.3 million, of which 2017 had an impressive growth rate of 120% reaching 44 million transactions, this is the first year BIDV has strongly deployed applications to deploy electronic banking services.

The impressive results come from BIDV's strong promotion of technological activities associated with the development of e-banking products and services during the above period, and especially the assignment of e-banking service development targets to units in the system.

Unit: million

Source: [14]

Chart 2.16 : Number of customers and transactions via electronic banking channels.

The rate of transactions via electronic banking channels/traditional channels has grown year by year in the period 2015-2019, reaching an average rate of 27.1%/year, of which in 2019 it reached an impressive rate of 50.3%.

2.2.7. Evaluation based on qualitative criteria

2.2.7.1. Customer loyalty and satisfaction

To evaluate the loyalty and satisfaction of individual customers at BIDV, the author conducted a survey of 253 customers (currently using services at BIDV) at 04 branches representing BIDV's regions: Hanoi, Ho Chi Minh City, Da Nang and Lao Cai, according to the following diagram:

Figure 2.17: Research process for measuring loyalty and satisfaction

Identify the research model and scales

Survey Design

Data Analysis

Present research results

The research model is shown in the diagram below:

Identify the research model and scales:

Figure 2.18: Research model for measuring loyalty and satisfaction

The scales are built through customer survey questions based on models of loyalty, service quality, and satisfaction, but are adjusted to suit BIDV's reality.

Survey Design

The questionnaire is designed to evaluate factors affecting the loyalty of individual customers at BIDV. The questionnaire consists of 02 parts:

Part I: General customer information

Part II: Customer evaluations during the use of BIDV's products and services include a set of simple, easy-to-understand and easy-to-choose questions aimed at understanding the views and opinions of customers participating in the survey on factors affecting customer loyalty. The questions are built based on inheritance from previous models and studies as well as from reality suitable for the research situation and BIDV's individual customers.

The questions in this section use a scale

Data Analysis

The results after the survey were updated, coded and tested for reliability of the scale before being put into statistical and analytical activities. This article uses SPSS software for analysis. Data processing and analysis are divided into 3 steps as follows:

Step 1: Clean and encrypt data

After the survey, the collected results will be filtered and coded into a data table and then entered into SPSS software for statistical analysis. The answer tables with missing information and incorrect meanings will be eliminated so that the data is highly reliable and complete.

Step 2: Test the reliability of the scale

Cronbach's Alpha reliability coefficient analysis method is used to evaluate the scale. In order to eliminate variables that are not reliable enough (with a total item correlation coefficient of less than 0.4). Cronbach's Alpha coefficient is a statistical test of the level of rigor that the questions in the scale with Cronbach's Alpha coefficient > 0.7 are considered to be reliable. Scales with Cronbach's Alpha coefficient from 0.6 or higher are also used in the context of new research. For this thesis, we take the standard Cronbach's Alpha coefficient > 0.7.

Step 3: Regression analysis of the influence of factors.

The objective is to evaluate in detail the level of influence of each factor and group of factors on customer loyalty. The level of influence is shown through the numbers on the regression equation. Factors with larger beta coefficients will have a higher level of influence. Factors with negative beta coefficients have an opposite influence and vice versa.

Research results:

+ Overview of the research sample: shown in the table below

Table 2.9: Overview of the study sample

Source: Customer survey results

+ Cronbach's Alpha test

Cronbach's Alpha coefficient tests the reliability of the scale, allowing the elimination of inappropriate variables in the research model. Accordingly, according to Cronbach's Alpha results, all 34 observed variables belonging to 6 factors have a Corrected ItemTotal Correlation coefficient > 0.3 and a Cronbach's Alpha coefficient > 0.6 meeting the conditions. Therefore, all 34 observed variables meet the requirements in testing the reliability of the scale, thus suitable for performing the next analysis steps.

+ Exploratory factor analysis EFA

The EFA factor analysis process was performed twice: From 34 observed variables belonging to 6 factors, it was shortened to 24 observed variables and grouped into 4 factors. All variances had Loand Factor values > 0.5

+ Regression analysis to evaluate the impact of factors on customer satisfaction and loyalty

Factors affecting customer satisfaction :

SHL = 0.426 + 0.327*NT1 +0.273*NT2+ 0.230*NT3

In the research model, which factor has coefficient β?The largest standardized variable will have the greatest impact on the dependent variable. With the multiple regression model above, NT1 has a coefficient = 0.327 is the largest so it has the greatest impact on customer satisfaction, followed by NT2 with coefficient = 0.273 and NT3 with coefficient =0.230.

The results of regression analysis show that the hypothesis that service quality affects customer satisfaction in the research model is accepted.

Factors affecting customer loyalty: LTT = 0.208*NT1 +0.419 *NT3+0.130 *SHL

In the research model, which factor has coefficient β?The largest standardized variable will have the greatest impact on the dependent variable. With the multiple regression model above, NT3 has a coefficient β= 0.419 is the largest so it has the greatest impact on customer loyalty, followed by NT1 with coefficient = 0.208 and SHL with coefficient =0.130.

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