It speaks volumes about Bryan Carroll’s desire to break from banking convention that the first people he recruited for the launch of TNEX - Vietnam’s first digital-only bank, were not financial or technology experts – but a psychologist and sociologist. By truly understanding customers’ needs, behaviours and emotions, he feels that TNEX is in a unique position in the market to deliver services, products and features that better match their lifestyle needs and aspirations.
TNEX has a clear mission "to provide inclusive, secure, free and innovative financial and lifestyle solutions for every individual and small and micro-enterprise in both urban and rural areas.”
A quick click on the feature-rich TNEX website, which floats through “space”, endorses this against-the-grain approach and seems appropriate for a company which wants to take digital banking into a new “universe”.
TNEX targets two customer cohorts; lower income consumers and micro merchants, both of which are primarily under/unbanked. The TNEX-Consumer app allows customers access to offers and products that match their daily lifestyle and financial needs e.g. payments, savings, buying food, chatting, entertainment etc. These are delivered via an online marketplace or ecosystem which is supported by the fully digital bank. TNEX-Merchant app allows merchants to post real-time, targeted offers to TNEX consumers.
It is clear that every aspect of Customer Experience is critical to TNEX.
For example, when designing its Consumer app, they did not approach a traditional development partner. They engaged with a successful gaming company out of Ho Chi Minh City. Every small detail has been co-designed face-to-face with their customers, even going as far as the design of their own set of emojis to better reflect customer emotions; Payments are gamified - ‘fired’ by rockets.
The Consumer app has ‘Planets’ which customers can visit to browse and purchase products such as clothing, food, education and travel. These products are placed on the planets by Merchants through the TNEX Merchant App. The whole ecosystem is fueled by ‘TNEX Energy’, a loyalty currency which incentivizes a vibrant flow of interactions and commerce between consumers and merchants. TNEX QR provides a closed-loop payment scheme, removing the current cost to consumers and merchants when making and receiving digital payments.
The TNEX proposition principally targets 58 million under/unbanked consumers and the plethora of four million small merchants across the Asian country. The target is to have 3 million customers and 200,000 merchants by 2023.
“The idea came to me while I was eating at a street stall and I saw consumers and merchants, but they weren’t connected digitally,” he said. “It was this interaction or ecosystem of the unbanked meeting the unbanked that got me thinking.
“Our objective, fundamentally, came out of inclusion. We believe that every person in Vietnam has the right to banking, to support their lifestyle, and every merchant has a right to leverage digital commerce to grow their business.”
While sponsored by Maritime Bank (MSB), TNEX is a stand-alone entity, given MSB’s focus on more affluent consumers and large SMEs and Corporate segments.
“Our goal is to be to be profitable by June 2023 and to pay back the investment by February 2024. Of course we would like to hit profitability sooner but I believe that these dates are prudent. Our operating costs are low and controllable and we can scale easily. Right now we have 108 staff known as ‘TNEXers’, growing to 131 by July 2021.”
The current version of the platform delivers two top-line propositions, B2C and B2B . With regards to B2C and reverting to the central theme of connecting retailers and customers, Carroll states that “most micro-merchants know how to succeed in the physical business world but not the digital one.”
“TNEX gives them the tools, knowledge and real-time data to remove most of the barriers which are preventing micro-merchants from joining in the Vietnamese Digital Revolution”.
For free, TNEX gives every merchant a website, cash management capabilities, qualified, targeted campaign management and inventory management. TNEX-QR allows them to make and accept digital payments. They can even chat in real-time (TNEX Chat) with their current and potential customers.
“TNEX helps Merchants to grow their business online with effective real-time targeted offers, using our ML and AI capabilities. These may be offers to previous customers, anyone who is within a kilometer of the store or to anybody who is likely to be interested, based on insights provided by TNEX deep analytics capabilities.”
TNEX is committed to providing ‘free everyday banking’ and a branch-less and personalized, data-driven experience. Carroll believes that TNEX is using advanced technology, data science, robots and automation which will ensure products and costs to serve are, on average, 97 per cent cheaper than traditional banks.
“Most banks are trying to optimize analogue processes and existing business models, whereas we are concentrating on a new business model for a largely underserved segment, leveraging a digital-only experience. Key to our success is that we have zero technical debt. All our technology is new and is the most advanced digital technology available,” he said. “The profile of our team reflects our proposition. The TNEX Customer Experience team (CX) is the largest and Data Science, the second largest. Our smallest is Operations, and the second smallest is IT. We have inverted the traditional bank staffing pyramid of being heavy in the back-office and light in the front-office.”
“Customers want a personalized, almost humanized experience”, he adds. Banking needs to evolve to meet this challenge; to become embedded in peoples’ everyday lives, rather than passively co-existing without lifestyle context. Data Science, AI and ML are a big part of this evolution, allowing us to personalize our services. But Data Science brings value throughout our Bank. It allows us to better protect our customers, gain their trust and service their needs at key moments.”
He believes Vietnam is ready for digital banking and foresees few barriers, given the penetration of mobile phones, the high expense of running physical branches and the rising cost of managing cash.
“The Vietnamese regulator (SBV) is very progressive and is actively pushing the digital agenda in a society where 80% of its citizens prefer to use cash,” he said.
Carroll extended a “big thank you” to several key partners, including Mambu, AWS, TopeBox and iConnect101. “All of our partners have been amazing. Thanks to the foundations that the Mambu core has given us we could integrate very quickly with all of our partners. Our success has undoubtedly been made possible by working hand-in-hand with these partners. They really understood what we are trying to do, bought into our mission and values; they really cared about our success.”
“TNEX is a fully open API’ed platform. Over the last few weeks, we have been progressing discussions with partners about allowing them to leverage our capabilities and to further develop their business models. The conversations on our B2B product-set, Banking as a Service, Ecosystem as a Service, Payments As A Service and Data Science are really getting exciting.”
For now, as a trailblazer, Carroll doesn’t see any rivals emerging soon.
“I really don’t see competitors biting at our heels just now. We are the first to do it. At this time, the vast majority of traditional banks don’t want my customers as they cannot profitably serve their needs with their current technology debt and traditional operating models.
“Most traditional banks are at the early stages of Digital Transformation. It is an expensive and complex process, so I think we have about two years head-start on the competition.”