Banking purge: Vietnam FREEZES 86 million accounts for noncompliance with new biometric requirements
In a sweeping move that has alarmed privacy advocates and cryptocurrency proponents alike, Vietnam has begun closing 86 million bank accounts that failed to comply with strict new facial biometric authentication mandates.
The State Bank of Vietnam (SBV) first announced the purge in July, with the closures taking effect this month. It cited rising fraud powered by artificial intelligence (AI) and money laundering as justification for the unprecedented financial lockdown.
Under the SBV’s rules, facial scans are required for account verification and transactions exceeding 10 million Vietnamese dong ($379). This has left millions of citizens and expatriates scrambling to reclaim access to their own funds, though foreign residents and inactive account holders appear to be disproportionately impacted.
The move has left nearly half of the country’s 200 million accounts now frozen or slated for deletion. Given this, critics warn this marks a dangerous escalation in government financial surveillance – one that could foreshadow similar crackdowns worldwide.
One Reddit user, a former contractor identified as “Yukzor,” described being forced to fly back to Vietnam to prevent HSBC from shuttering his account. He called the requirement “crazy” in an era where digital solutions should suffice.
“They said they will close my account this month if I don’t fly in and update the biometrics,” Yukzor lamented, highlighting the draconian reality of centralized financial control.
How Hanoi is accelerating financial surveillance
Historical precedent suggests Vietnam’s actions are far from isolated. From Cyprus’ 2013 bail-ins to Nigeria’s abrupt cryptocurrency bans, governments have repeatedly weaponized banking access to enforce compliance. Bent noted it would be “naive to think Vietnam will be the last” – pointing to Lebanon, Turkey and Venezuela as cautionary tales where capital controls crippled financial autonomy.
Linking bank accounts to biometrics poses severe security risks, as compromised biometric data – unlike passwords – cannot be changed if hacked, leaving victims permanently vulnerable to identity theft and financial fraud. Additionally, centralized biometric databases like those proposed for digital IDs could be exploited by governments or corporations for surveillance, control and even exclusion from essential services based on compliance with mandates.
However, the SBV defended the policy as a necessary cleanup of dormant or fraudulent accounts, particularly after police busted an AI-driven laundering ring moving 1.03 trillion dong ($39 million) using spoofed facial scans. Yet critics like environmentalist Daniel Batten warn the rules grant the SBV “next-gen financial surveillance ability,” eroding privacy under the guise of security.
While local crypto executives downplay the backlash, insisting most Vietnamese citizens remain unaffected, the policy’s ripple effects are undeniable. Herbert Sim, chief marketing officer of the AI Creator Economy and Network, noted the challenges for foreigners: “The OTP [One-Time Password] and phone-bindings, needing in-person biometric verification are big hurdles.”
For cryptocurrency advocates, Vietnam’s crackdown underscores the urgency of decentralized alternatives where no government can freeze funds or demand biometric tribute.
The fallout from Vietnam’s banking purge serves as a stark reminder. In an age of escalating digital control, the fight for financial sovereignty is just beginning.
yogaesoteric
September 23, 2025