From early 2024, all banks and payment intermediaries will identify online transactions based on national population data, solving the problem of fraud using spam accounts.
The above information was stated by Mr. Pham Anh Tuan, Director of the Payment Department, State Bank at the press conference on Cashless Day on the morning of May 26. Mr. Tuan said that the State Bank is the first unit to coordinate with the Ministry of Public Security to implement the plan to exploit the national population database.
The Director of the Payment Department said that after the data exploitation plan is expected to be completed by December 31 this year, all credit institutions and payment intermediaries will identify customers through chip-embedded citizen identification cards. Counter transactions and online payments are also expected to be required to authenticate customers with chip-embedded citizen identification cards, contributing to thoroughly solving the problem of renting, borrowing, and buying and selling bank accounts that has existed for many years.
Mr. Pham Anh Tuan, Director of Payment Department, State Bank of Vietnam shared at the Cashless Day press conference on May 26. Photo: SBV
The Department of Information Security believes that junk bank accounts are the source of recent online money scams. According to Mr. Tran Quang Hung, Deputy Director of the Department of Information Security, to carry out fraud, scammers need bank accounts for victims to transfer money to. In many recent scams, even though victims know the phone number and the account to receive the money, it is still difficult to track down the person behind them because most of them use fake information, including junk SIM cards and junk bank accounts. If we can solve the problem of unregistered bank accounts, online fraud can be reduced by 80-90%.
To resolve this situation, the Director of the Payment Department said that it is necessary to prove the identity of the account opener during use, especially with electronic money transfers.
"We have asked banks to review their risk appetite, thereby determining the payment threshold that requires biometric customer verification," said Mr. Tuan.
According to statistics from the first four months of the year, most of the electronic money transfers were small in value, with only 10% of transactions valued at over VND2 million per transaction. Meanwhile, transactions by fraudsters are often worth hundreds of millions of VND. Therefore, Mr. Tuan said that banks can set a threshold of VND5-10 million per transaction to require biometric verification. The verification will only take about 5-7 seconds, so according to him, it will not affect the customer experience.
The Director of the Payment Department also said that banks must verify at the counter with customers who have multiple bank accounts using the same phone SIM. In addition, the Payment Department also expects the Ministry of Information and Communications to more thoroughly address the situation of junk SIMs to minimize financial fraud.
At the press conference, the State Bank also said that non-cash payments have grown impressively in recent times. The rate of people with bank accounts in Vietnam is currently over 74%, approaching the target of 80% of adults having accounts by 2025.
By the end of 2022, 40 banks had allowed the opening of payment accounts through electronic identity verification (eKYC). More than 11.9 million payment accounts were opened using eKYC and are active.
In addition, the number and value of ATM transactions decreased by 2.7% and more than 4% respectively over the past year, signaling a trend of people becoming less dependent on cash and this trend will become stronger in the coming years.
Quynh Trang
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