FINTECH | Vietnam banking fraud lessons raise concerns for PH digital finance
Trusting Social, which developed fraud detection and digital identity systems in Vietnam, said the Philippine banking industry now faces similar structural risks as regulators tighten rules on digital fraud prevention.
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The Philippines may face the same digital banking fraud vulnerabilities exposed in Vietnam unless financial institutions strengthen identity verification systems, according to financial technology firm Trusting Social.
The company said Vietnam’s biometric verification mandate in 2024 revealed that nearly half of the country’s registered bank accounts, or more than 86 million out of about 200 million accounts, could not be matched to a real person. Those accounts were eventually shut down by September 2025.
Trusting Social, which developed fraud detection and digital identity systems in Vietnam, said the Philippine banking industry now faces similar structural risks as regulators tighten rules on digital fraud prevention.
“When the Philippines mandate came, we already knew what to watch out for,” said Nguyen Nguyen, founder and CEO of Trusting Social, citing the company’s experience working with rural users, basic mobile phones, and inconsistent identity documents in Vietnam.
The company said Vietnam’s reforms exposed years of exploitation by criminal groups operating within weak identity verification systems. Although authorities reported a 59% drop in individual fraud and theft cases and a 52% decline in accounts receiving illicit funds, fraud syndicates continued adapting their methods.
In one case cited by the company, Vietnamese police dismantled a 14-member group accused of laundering $39 million using AI-generated fake facial scans to bypass biometric checks. Trusting Social said its fraud prevention systems across eight Vietnamese banks blocked more than $4.3 billion in attempted mule account transactions within a year.
The company warned that fraud operations often shift toward weaker institutions once stricter controls are implemented elsewhere.
The Philippines recorded 70,000 fraud complaints in 2024, according to the Bangko Sentral ng Pilipinas. The Cybercrime Investigation and Coordinating Center also logged 10,004 cybercrime complaints during the same year, triple the 2023 figure, with reported losses nearing P198 million.
BSP Circular 1213 requires financial institutions to phase out SMS and email one-time passwords for high-risk transactions by June 30, 2026. The Anti-Financial Account Scamming Act also increases liability for institutions that fail to implement sufficient protections against fraud.
Johnny Escaler, CEO of Trusting Social Philippines, said institutions in Vietnam that focused on long-term customer protection rather than minimum compliance were more successful in reducing fraud risks.
The company added that Vietnam continued expanding biometric verification requirements after the initial rollout, eventually covering corporate accounts, payment cards, and e-wallets. In March 2026, the BSP also issued a draft circular proposing server-side biometric authentication systems for Philippine banks.
Trusting Social said the Philippines still has an opportunity to strengthen its digital banking ecosystem before fraud threats escalate further.
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