The announcement by the State Bank of Vietnam (SBV) that nearly 86 million bank accounts will be closed as of September 2025 has drawn significant attention. These accounts are inactive or lack biometric verification, which, according to the regulator, makes them a fertile ground for fraud and money laundering. While the measure appears reasonable at first glance, it raises questions about its effectiveness, proportionality, and potential far-reaching consequences for both citizens and the financial sector.
The rationale behind the measure
The closure is part of a broader strategy to digitize and secure the Vietnamese banking system. By introducing biometric verification (such as fingerprints and facial recognition), the SBV aims to prevent accounts from being misused by fraudsters or functioning as “ghost accounts.” In a country where more than 200 million bank accounts circulate—far exceeding the population—cleaning up the system seems necessary to ensure transparency and reliability.
Moreover, the measure aligns with international trends in which financial institutions are required to implement increasingly stringent Know Your Customer (KYC) and anti-money laundering (AML) regulations. From this perspective, the initiative can be understood as a step toward international compliance (Zetzsche, Buckley, Arner, & Barberis, 2020).
Critical implications of the measure
1. Inclusion versus exclusion
Although the measure is officially framed as a tool for fraud prevention and financial inclusion, the closure of 86 million accounts may achieve the opposite. Citizens struggling with digital or biometric identification—often the elderly, migrants, or rural residents—risk being excluded. Thus, an instrument intended to broaden access risks turning into a mechanism of exclusion (Demirgüç-Kunt, Klapper, Singer, Ansar, & Hess, 2022).
2. Trust versus trust crisis
While the government seeks to instill confidence in the financial system, a mass closure of accounts may trigger distrust. Citizens who suddenly lose access to their accounts will inevitably question whether banks and the state are reliable partners (Chen & Volz, 2021).
3. Autonomy versus total control
The obligation of biometric verification directly affects individual autonomy. Linking bank accounts to biometric data creates an infrastructure in which the state has near-total visibility and control over financial transactions. In an authoritarian context, this can lead to pervasive surveillance, selective exclusion and repression. The line between legitimate regulation and a digital control state becomes alarmingly thin (Zuboff, 2019).
4. Legal ambiguities
The account purge raises questions about legal certainty: what criteria define an account as “inactive” or “insufficiently verified”? How can citizens appeal such decisions? Without transparency and a robust legal framework, the risk arises that closures become arbitrary or politically motivated. This opens the door to financial access being used as a tool of social or political control (Nguyen & Morgan, 2020).
5. Digital transformation with adverse economic effects
Although Vietnam aims to stimulate its digital economy, this measure may hinder innovation. Fintech and e-commerce companies, dependent on millions of small transactions, could lose vast numbers of potential customers. Ironically, a modernization drive intended to strengthen the economy could instead weaken the digital ecosystem, while simultaneously reinforcing state control over citizens and businesses (World Bank, 2023).
Conclusion
The closure of 86 million bank accounts in Vietnam is presented by the authorities as a necessary step toward fraud prevention and international compliance. Yet the consequences may extend far beyond curbing abuse. The policy risks structurally excluding vulnerable groups, undermining public trust in the financial sector, and stifling innovation in the digital economy.
The most fundamental danger lies in the shift from autonomy to control. By linking bank accounts to biometric data, the state acquires unprecedented powers to monitor and shape financial behavior. This creates an infrastructure that not only prevents fraud but could also serve as a tool of surveillance and social discipline.
The key question is not merely whether the measure is technically feasible or legally sound, but whether Vietnam is prepared to enshrine the necessary safeguards for rights, privacy, and financial autonomy. Without such guarantees, a modernization initiative may easily devolve into an authoritarian practice of digital control.
References
- Chen, Y., & Volz, U. (2021). Digital currencies and the global financial system. Journal of Economic Policy Reform, 24(3), 299–317.
- Demirgüç-Kunt, A., Klapper, L., Singer, D., Ansar, S., & Hess, J. (2022). The Global Findex Database 2021: Financial Inclusion, Digital Payments, and Resilience in the Age of COVID-19. Washington, DC: World Bank.
- Nguyen, T. T., & Morgan, P. J. (2020). Financial inclusion and fintech in Vietnam. ADBI Working Paper Series, 1091. Tokyo: Asian Development Bank Institute.
- World Bank. (2023). Vietnam Digital Economy and Financial Sector Development Report. Washington, DC: World Bank Group.
- Zetzsche, D. A., Buckley, R. P., Arner, D. W., & Barberis, J. N. (2020). The rise of digital identity: Balancing inclusion and regulation. Fordham Journal of Corporate & Financial Law, 25(3), 459–529.
- Zuboff, S. (2019). The Age of Surveillance Capitalism: The Fight for a Human Future at the New Frontier of Power. New York: PublicAffairs.