In 2016, when he was a financial consultant with the AMP Insurance Group in Australia, Mr. Nghiem Xuan Huy first had the opportunity to use Stockspot and Fornech fintech products, which helped him optimize his idle capital. He realized that while common around the world, such products were yet to be found in Vietnam. After some research, he established Finhay in 2017, a fintech solution connecting small investors with Vietnamese financial funds.

Finhay includes a website and an app and aims to connect small investors (with capital of as little as VND50,000 ($2.1)) with Vietnamese financial funds and provide them with financial management solutions. 

Investors use Finhay’s tools to accumulate wealth by investing smartly with small amounts of money, such as putting VND100,000 ($4.2) to VND200,000 ($8.5) monthly into long-term financial products. Investments are managed and invested by fund management companies in the Finhay system in stocks, bonds, or deposit. The fund provides users with a fund certificate (CCQ) at the price they are investing, with profits earned as their CCQ increases in price.

Therefore, instead of individuals managing many assets, the Finhay platform helps them manage the asset and convert it into a corresponding value for easy monitoring. Customers can directly check their balance or asset value after accessing the financial fund’s products. The monitoring is also completely transparent. For users new to investment, Finhay will provides a host of useful information, which is popular among those studying banking and finance and wish to apply knowledge in practice.

Mr. Huy said Finhay uses personal data sources to assess a customer’s risk appetite and then makes recommendations on the structure of asset categories appropriate to that risk appetite. The method is based on the theories of Harry Markowitz, who won the Nobel Prize for Economics in 1990. “Finhay focuses on automation, allowing customers to monitor and manage their investments,” he added.

One Finhay user, Mr. Pham Thanh Hung, Vice Chairman of the CEN Group, told local media the app saves time and helps create a habit of saving. “Normally, when opening a savings account, customers must visit banks or financial institutions, but in using the app they can transfer funds quickly through payment gateways and e-wallets,” he explained. “The app also sets up portfolios that match the personality and income of the user and they need only decide which investment structure to invest in.”

As automation becomes enhanced, security is a matter of primary concern for customers. Finhay must therefore upgrade its security technologies and currently applies a DMZ structure to prevent attacks. In certain special access, only a local IP can access the system. The database is backed up every hour on three different servers in Vietnam and overseas, with all information encrypted.

Finhay’s customers are mostly young people aged 25 to 28 who are office workers earning more than VND8 million ($345) a month and have investment needs and a moderate amount of idle capital, little time, and a willingness to access online services. It partners with UOB Bank, OCB Bank, and Sacombank, and has open funds such as VFB, TCBF, VF1, BCF, SCA, and others. 

Initial difficulties

Many people using Finhay for the first time become concerned because their investment appears to earn no profit. Profit comes, in fact, as the CCQs price increase. Finhay is not offering an opportunity to invest in a particular financial product, instead providing a tech platform to help users access financial funds, while helping assess risk appetite and proposing a suitable solution. All decisions to invest in a financial fund or organization are entirely up to the user.

“Fintech is a rather delicate area, especially as it involves money,” Mr. Huy said. “But with capital coming from reputable venture capital funds, bank partners, and domestic and foreign financial institutions, together with its two years in business, Finhay gradually built up trust among users.”

Most Vietnamese people are still in the habit of using traditional saving services instead of technology, and changing such habits has been a major difficulty. According to Mr. Huy, while bank savings are a stable form of investment, funds must be left with the bank for a certain period of time. “Investing in financial funds is riskier but the potential profits are higher,” he said. “And Finhay users can withdraw their money whenever they choose.”

Though Finhay faces certain difficulties, two years on its user numbers stand at nearly 100,000. It has also announced it received nearly $1 million from Insignia Venture Partners and other investment funds from Hong Kong and the US earlier this year. Mr. Huy hopes it will become a popular capital channel for open funds and a secure place for individuals to invest their money.