Vietnam ramps up pace of digital transformation as biometrics cleans up banking

Digital governance in Vietnam is gaining momentum, with nearly 40 percent of administrative procedures completed fully online in June.

Data-based management practices have been adopted by 73 out of 84 government entities, and it’s estimated a third of adults possess personal digital or electronic signatures, an 11-point increase since December 2024, reports Voice of Vietnam.

These advancements were reported from the third meeting of Vietnam’s Government Steering Committee for Science and Technology Development, Innovation, and Digital Transformation led by prime minister Pham Minh Chinh.

A national portal for science and technology now features over 250 proposed solutions, and a new framework for evaluating local innovation was introduced. Mobile broadband now reaches 99.3 percent of villages and hamlets, with Vietnam ranked 20th globally in broadband access speed and 26th in fixed broadband.

The government has allocated VND25 trillion ($954m) toward science, technology, innovation, and digital transformation initiatives. The meeting also covered Project 06, which focuses on resident data systems, electronic identification (e-ID), and e-authentication applications.

Digital ID rollout continues with the Vietnamese government targeting foreigners residing in the country with a 50-day campaign from July 1 to August 19. Foreigners who hold temporary or permanent residence cards in Vietnam are eligible for level-2 digital IDs, with their number now estimated to be around 100,000.

Biometrics takes out millions of potentially fraudulent bank accounts

The State Bank of Vietnam has mandated full verification of businesses and biometric data of legal representatives before firms can make electronic transactions or withdrawals since July 1. In an interview with Vietnam Investment Review, Nguyen Quoc Hung, vice chairman and general secretary of the Vietnam Banks Association (VNBA), said that an industry-wide fraud data-sharing system is needed to improve the detection of suspicious transactions and protect public trust.

Hung pointed to how the surge in fraud and scams places pressure on banks to make significant investments in new technology and verification processes.

Vietnam has around 200 million registered bank accounts, according to official statistics. Following the implementation of biometric verification and cross-checking with the national population database, however, just 113 million individual accounts and approximately 711,000 corporate accounts remained active.

This means almost 86 million accounts are now inoperable, suggesting that many were created for fraudulent purposes. These bank accounts that remain biometrically unauthenticated will be deleted by commercial banks beginning September 1.

Vietnamese banks are increasingly leveraging biometric authentication and AI-powered systems to combat fraudulent transactions. Face biometrics, fingerprints and voice biometrics are being adopted to verify user identities during financial transactions to prevent unauthorized account access.

The VNBA has recommended that legal regulations are reformed to align with “technological advancement and operational realities” and invites detailed guidance on the application of new technologies such as AI, blockchain and fintech solutions to assist compliance among banks.

Article Topics

banking  |  biometrics  |  digital government  |  digital identity  |  identity verification  |  Vietnam