In 2011, only 21.4 percent of Vietnameseadults had an account at a formal financial institution, andonly 36.9 percent of all borrowers used a formal lender -both indicators are well below the regional averages in theEast Asia and Pacific. The formal financial sector inVietnam is dominated by banks; however, retail lending isstill rather underdeveloped due to often flawed lendingpractices and low levels of financial literacy among thepopulation. Vietnamese authorities and the civil societyhave demonstrated a deep commitment to financial consumerprotection by continuous dialogue and persistent legislativeactivities, and yet, much still needs to be achieved. Thelegal and regulatory framework for consumer protection inthe financial sector, and related supervisory arrangements,are at a nascent stage of development. This World Bank’sdiagnostic review was conducted in response to a requestfrom the State Bank of the Socialist Republic of Vietnam.The banking, non-bank credit institutions, securities,insurance, and credit reporting sectors were considered aswell as financial literacy strategies and programs. Thereview was conducted by reference to the World Bank`s goodpractices for financial consumer protection and provides adetailed assessment of the institutional, legal, andregulatory framework for financial consumer protection.Volume I of the review summarizes the key findings andrecommendations and volume II provides a detailed comparisonwith the good practices.
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