Less than half of the population in many developing countries has access to formal financial services. And in Vietnam, it could be a lot less. When there’s limited access to finance, it often leads to income inequality as well as slower economic growth.
Microfinance, or financial services for the underserved, offers a distinctively cross cutting tool capable of alleviating some of the most challenging issues of our time. But to them, the most hardworking yet underserved sector, getting access to protection and investment is only for the rich and for those who can afford to spare extra amounts from their income. Not to mention financial services are not nearly as accessible as they ought to be.
This is where financial inclusion comes in. It means individuals and businesses get to use affordable financial products and services that meet their needs – transactions, payments, savings, credit, and insurance – delivered in a responsible and sustainable way.
Getting that access is the first step in order to obtain broader financial solutions.
Income’s affordable financial solutions for Vietnamese consumers
In 1970, NTUC Income was established by the National Trade Union Congress to provide accessible and affordable insurance for blue-collar workers and their families during the early years of nation-building. Over the last few years, NTUC Income has successfully implemented innovative, lifestyle-based microinsurance products like Droplet and SNACK to fit the needs of increasingly digitally-savvy customers in Singapore. Today, they look forward to replicating similar successes with like-minded partners to serve the financial needs of Vietnamese consumers.
“Our mission has always been to make insurance accessible to the masses and help empower better financial well-being” Mr. Andrew Yeo, the CEO of NTUC Income said.
“Income’s innovative, ecosystem and data-driven approach puts us at the forefront of customer-centric solutions that meet rapidly evolving needs and empower better financial well-being. With HIVE, Income’s Insurance-as-a-Service platform, innovative digital products are now made available in the region through pre-built insurtech integrations. This cements our commitment to provide financial access with our local partners beyond Singapore”, Mr. Yeo said.
NTUC Income’s inaugural Innovation Day marks the beginning of a series of Innovation Days they have planned in the region. In this event, they hope to be a platform to inspire conversations and capture the exchange of ideas, and most importantly, to improve financial access within digital ecosystems.
This virtual event took place on March 25, 2022, led by Mr. Nguyen Quang Huyen, Deputy Director of Department of the Insurance Supervisory Authority, Ministry Of Finance and were joined by four distinguished speakers for the panel discussion: Mr. Bui Xuan Thu, CEO of Post and Telecommunication Joint Stock Insurance Corporation; Mr. Phan Hong Minh, CEO of JupViec; Dr. Sungsoo Na, Chief Financial Officer of FinHay and; Ms. Edlyn Khoo, Deputy Vice President, Digital Transformation Office of NTUC Income.
Webinar with the participation of leading experts
A few of the main points discussed were the common difficulties and issues a gig worker often encounters. JupViec’s CEO talked about challenges that gig workers face on the lack of financial knowledge and its impact on their ways, how they support the workers to gain more financial needs, redefining micro-insurance. FinHay CFO, on the other hand, discussed financial challenges and how the biggest challenge is the 'inflation rate,’ what was $1 yesterday is not $1 tomorrow. He also shared a few investment tricks and tips.
Income DVP Edlyn’s discussion was about the ecosystem trends in Singapore and what similarities they see in Vietnam. Furthermore, she shared the embedded solutions NTUC Income has to reimagine insurance for the Vietnamese consumers.
Blue-collar workers are typically classified as involving manual labor and compensation by an hourly rate. And more often than not, they live on tight budgets and a weekly paycheck to help make ends meet. Knowing the external and internal risks of the extensive job requirements from blue-collar workers, insurance providers need to create financial solutions that fit different segments of society. Also considering their financial limitations.
Ms. Edlyn Khoo, Deputy Vice President, Digital Transformation Office of NTUC Income
In Vietnam, the blue-collar labor force is expected to reach 43 million by 2025 because of the economic development focusing on industry and services as well as the shift in labor structure. Income’s purpose is to empower better financial well-being for all and to offer insurance access even to the underserved amongst us. We aim to stay committed to our cause even as we plant our flag abroad.
“Over the past couple of years, we have successfully implemented innovative, lifestyle-based microinsurance products in Singapore, to serve the protection need of underserved segments such as gig economy workers. For example, with our Critical Illness: Pay per Trip (CIPPT) product, Grab drivers-partners are able to contribute between S$0.10 and S$0.50 (to change to VN currency for local relevancy) in premium for a fixed sum assured, and accumulate the corresponding insurance coverage with each trip they complete. A common painpoint faced by gig workers is the variable income and many often are not able to prioritise insurance. With our new insurance models, gig workers pay for insurance as they earn, and this gives them the protection they would otherwise not have access or be able to afford.
It was exciting to hear earlier from PTI, JupViec and Finhay on how much progress have been made to improve the accessibility and affordability of insurance, particularly for underserved segments in Vietnam. We see huge potential in empowering more players to adopt digitally-led solutions to accelerate this transformation amongst an increasingly digitally- savvy population Vietnam”, Mr Andrew Yeo, CEO Of NTUC Income stated.
Mr. Andrew Yeo, the CEO of NTUC Income
Income is building use cases on different ways they can embed bite-sized insurance and investment products into customers' increasingly digital journeys with their partners PTI, JupViec and FinHay.
They say, conventional wisdom favors the purchase of life insurance during the later stages of one’s life. However, for anyone to safeguard the key milestones in their life and that of their loved ones, people of every age bracket should come to the realization that integrating a life insurance policy is a must in their financial portfolio.
Whether you just landed your first job or already fulfilling your financial goals and milestones, the best time to think about the future is now. With Income’s affordable financial solutions, it gets easier.