The State Bank of Vietnam (SBV) has frozen around 86 million retail bank accounts due to alleged non-compliance.
This includes submitting biometric data, which the government proclaimed mandatory in a circular (17/2024/TT-NHNN) issued which came into effect on July 1 last year.
The decision requires online banking transactions exceeding 10 million VND (about £280), or 20 million VND in total for 24-hour period, to use facial recognition.
As with so much of the tech that is being rolled out across the world at the moment, the Vietnamese government claims the use of biometric data, in tandem with a government issued digital ID, will negate the number of fraud cases and minimise financial loss.
The authority claims instances of these types of fraud have dropped sharply due because of certainty that the users of the accounts are the actual holders.
The people say no
Some of the non-compliance has most certainly been down to the technological capabilities of the hardware being used and the level of understanding by the end user.
For example, many of the mobile phones being used in Vietnam do not have Near-Field Communication readers (NFC’s) which a required for chip based ID card verification. However, customer comments and surveys have revealed an apathy and mistrust of the technology that seems to be a bigger hurdle for the authorities than hardware and infrastructure problems.
Many people say that they just do not see the urgency or perceived necessity for using biometric data, and if people can avoid making transactions that will attract a need to use digital ID, they would prefer to avoid it. Other concerns include worries about the storage of personal data, who has access to it and the potential for it to be leaked.
A healthy scepticism is needed here. Not least of how bold national governments are becoming in terms of their authoritarian tendencies, and how these banking protocols could be used to severely affect the lives of regular people very much for the worse.
The 86 million figure represents the vast majority of bank users in Vietnam. The country has a population of around 102 million, and from my research, I found that the number of people under 14 is 21 million. A bit of easy deduction shows that there are around 81 million bank accounts that belong to adults, meaning that the overwhelming majority of accounts that have been frozen will have previously had a degree of regular activity.
A bell-weather for advanced nations
It will be very interesting to see how this showdown between the people and the banks/government pans out as this looks to be a bell-weather warning for more advanced countries on how this technology will be received. It is interesting to note that a central bank digital currency was rolled out in Nigeria in 2021 and still has not been adopted by the people, probably due to trust issues.
In the UK, there have been very strong rumours of Keir Starmer making plans to introduce a digital ID card, citing such nonsense as being able to use it to better identify legal citizens from the illegal migrants who have flooded our boarder in the last few years. Maybe that problem was created as they had a solution already waiting.
As I have written before, the reader should be very wary of government infrastructure which offers more security, speed and convenience, as all these attributes are easily turned against the user as the government and banking become more and more centralised. In my opinion, the Vietnamese and Nigerian people have dealt with these mandates in the correct way and we in the west should be led by their example.
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