Banking sector proactively builds a technological shield to strengthen transaction security

Completing the legal framework and tightening identification and transaction authentication

Le Van Tuyen, Deputy Head of the Payment Department at the State Bank of Viet Nam, shared that the bank has been implementing a range of key solutions in a coordinated manner, with top priority given to improving the legal framework to ensure security and safety in payment activities.

Accordingly, the State Bank of Viet Nam has proactively conducted research, provided policy advice and submitted for promulgation of a number of important legal documents to promote non-cash payments while strengthening security and safety regulations. These include decrees related to non-cash payments, controlled regulatory sandbox mechanisms in the banking sector, and mobile money.

At the same time, the State Bank of Viet Nam has issued a system of circulars providing detailed guidance on the Law on Credit Institutions and elaborating provisions under the decree on non-cash payments. These regulations cover many key areas such as payment agency activities; the management, operation, and use of the national interbank electronic payment system; the provision of non-cash payment services; the opening and use of payment accounts at credit institutions; bank card operations; the provision of intermediary payment services; supervision of important payment systems; as well as licensing participation in international payment systems by banks and branches of foreign banks.

Notably, in the process of completing the legal framework, the State Bank of Viet Nam has introduced several new provisions, particularly requirements to ensure verified ownership identification for online payment transactions.

Specifically, customers are only allowed to withdraw money or make electronic payments from payment accounts after their identity documents and biometric information of the account holder or authorised representative have been fully verified and authenticated. This authentication requirement goes beyond data verification and requires face-to-face verification for individual customers or legal representatives of organisations, except in certain specific cases as stipulated.

In addition, the State Bank of Viet Nam requires credit institutions to apply biometric authentication solutions for online transactions to strengthen security layers. At the same time, regulations on administrative sanctions in the monetary and banking sector have also been supplemented, including penalties for acts of abusing payment accounts or e-wallets to commit illegal activities.

Furthermore, the State Bank of Viet Nam has issued the Strategy for the Development of Viet Nam’s Payment Systems to 2030, which serves as an overall orientation for the development of digital payments, in which security, safety, and fraud prevention are identified as core pillars.

These improvements to the legal framework not only enhance the effectiveness of state management but also create a robust legal corridor, helping to minimise loopholes that criminals may exploit in the digital payment environment.

Cleaning data and strengthening inter-agency connectivity to prevent fraud early

Alongside institutional improvements, the State Bank of Viet Nam places particular emphasis on data cleansing and enhanced inter-agency coordination to prevent, detect, and stop fraud at an early stage.

According to Le Van Tuyen, the State Bank of Viet Nam has closely coordinated with the Ministry of Public Security to implement Coordination Plan No. 01/KHPH-BCA-NHNNVN (dated April 24, 2023), which focuses on the exploitation and connection of the National Population Database. Through the use of chip-based citizen identification cards and the VNeID electronic identification application, credit institutions can accurately identify and verify customer information, thereby limiting identity fraud.

The connection and utilisation of population data not only improve the quality of customer identification but also contribute to “cleaning” the banking sector’s data system, creating an important foundation for fraud prevention activities.

At the same time, implementing Official Dispatch No. 29/CD-TTg (dated April 3, 2025) of the Prime Minister on strengthening the prevention and handling of high-tech fraud, the State Bank of Viet Nam is coordinating with the Ministry of Public Security, the Ministry of Science and Technology and relevant units to verify information between mobile subscribers using Mobile Banking and payment account holders.

In parallel, the banking sector is conducting a comprehensive review of payment accounts and SIM cards to strengthen state management and limit the use of anonymous SIM cards and “ghost” accounts for fraudulent purposes.

The implementation results have shown positive progress. As of March 20, 2026, the entire banking sector had verified biometric information for more than 151.4 million individual customer records and over 1.82 million organisational customer records through chip-based citizen identification cards or the VNeID application.

These figures reflect the large scale of the data cleansing campaign while demonstrating the banking sector’s significant efforts in standardising customer information. Biometric authentication not only reduces the risk of impersonation but also enhances the reliability of electronic transactions.

According to the State Bank, data connectivity and multi-layer authentication have played an important role in preventing impersonation and the use of forged documents to open accounts or conduct illegal transactions — one of the most common methods used by high-tech criminals today.

One of the breakthrough solutions implemented by the State Bank is the Information System for Management Support, Supervision and Fraud Risk Prevention in payment activities, known as SIMO.

According to Le Van Tuyen, the SIMO system allows member institutions to report information on suspicious accounts when detected and share such information with other members.

Based on this centralised database, credit institutions can quickly decide to block transactions immediately or require customers to undergo additional authentication and identification before conducting online transactions, thereby helping to minimise fraud and protect customers’ accounts.

In practice, the system has delivered clear results. As of April 12, 2026, according to reports from service users, SIMO had issued warnings to more than 3.7 million customers.

Notably, more than 1.2 million customers proactively suspended or cancelled transactions after receiving warnings, with the total transaction value reaching nearly 4.17 trillion VND.

These figures highlight the practical role of early warning systems in protecting customers’ assets. In addition to preventing suspicious transactions, SIMO also helps raise user awareness of fraud risks in the digital environment.

It is evident that the combination of legal improvements, data cleansing, and the application of modern monitoring technologies has created a multi-layered “defence ecosystem” for payment activities.

In the context of rapidly developing digital payments, these solutions not only help minimise fraud risks but also strengthen public trust in the banking system, thereby promoting the goal of developing non-cash payments in a safe and sustainable manner.