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“Compulsory Account Verification for Online Money Transfers Starting 2025”

The State Bank of Vietnam has introduced a new regulation, effective from the 1st of January 2025, that requires all bank account holders to authenticate their accounts. This means that account holders must verify their ownership before conducting any transactions. Accounts will be suspended if the identified period expires.

Administrator

31 August, 2024

Primary Account Verification is Mandatory

Circular 17/2024/TT-NHNN (Circular 17), issued by the State Bank on June 28, 2024, and effective from July 1, 2024, stipulates the opening and usage of payment accounts at credit institutions providing payment services. However, some provisions will come into force later.

Notably, point c of Clause 5 of Article 17 of Circular 17, which takes effect on January 1, 2025, pertains to personal payment accounts.

Accordingly, customers using payment accounts (bank accounts) can only withdraw money and perform electronic payment transactions (online transfers) on their accounts after completing the verification process. This involves matching their identity documents and biometric data with that of the account holder or their representative (for individual customers) or legal representative (for organizational customers).

The account holder’s biometric data must match the encrypted information stored on their chip-enabled National Citizen ID card or the verified electronic identity account created by the electronic identification and authentication system. Alternatively:

Biometric data can be collected through in-person meetings for foreign nationals without electronic identities, ethnic Vietnamese whose citizenship is unclear, or:

Biometric data has been collected and verified to match the encrypted information on the National Citizen ID card or the electronic identity account. Or:

The account holder’s biometric data is stored in the National Population Database if they have a non-chip National Citizen ID card.

NHNN regulations on safety and security in providing banking services electronically must be adhered to when applying authentication measures for each type of electronic payment transaction.

The use of VND-denominated payment accounts by non-residents and resident foreign individuals, as well as foreign currency payment accounts, is subject to the provisions of this article and foreign exchange management laws.

Accounts will be suspended if National Citizen ID cards expire. Image: Nam Khanh

Thus, from January 1, 2025, all bank account holders must register their biometric data if they wish to withdraw money or make online transfers. This is an improvement over the previous regulation, Decision 2345 of NHNN, effective from July 1, 2024, which mandated biometric verification for transfers exceeding VND 10 million per transaction and VND 20 million per day.

This new rule aims to eliminate non-primary bank accounts and enhance the security of electronic banking services for customers.

However, it’s important to note that not all transactions will require biometric authentication with this new regulation. Mandatory biometric verification for transfers remains as stipulated in Decision 2345 of NHNN.

Accounts will be suspended if National Citizen ID cards expire

Circular 17 also elaborates on the responsibilities of banks in ensuring safety and security in opening and using payment accounts.

Article 19 of the Circular requires banks to issue internal regulations on risk management in opening and using customer accounts. This includes measures to verify customer information during the account opening and usage process, such as:

Checking the legality and validity of customer information and ensuring its accuracy and authenticity;

Preventing impersonation, intervention, modification, or distortion of customer information during the account opening and usage process;

Ensuring that payment accounts are used only by the account holder or their authorized representative.

Banks are also responsible for monitoring the validity of customers’ identity documents and notifying them at least 30 days before the documents expire. If the documents expire, the bank will temporarily suspend payment and withdrawal transactions on the customer’s account.

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