Implementing the payment of pensions and social insurance payout through personal accounts of beneficiaries in Vietnam

Implementing the payment of pensions and social insurance payout through personal accounts of beneficiaries in Vietnam (Internet image)

On June 19, 2024, Vietnam Social Security issued Official Dispatch 1905/BHXH-TCKT on the implementation of the social insurance agency to transfer the payment of pensions and monthly social insurance payout through personal accounts for beneficiaries.

Implementing the payment of pensions and social insurance payout through personal accounts of beneficiaries in Vietnam

In accordance with the policy of the Government of Vietnam to reduce intermediaries, simplify administrative processes and procedures as stipulated by Resolution 131/NQ-CP dated October 6, 2022, on promoting administrative procedure reform and modernizing the directive and operational methods to serve citizens and businesses; and to meet the payment requirements of social insurance payout, unemployment insurance, and manage beneficiaries in the trend of digital transformation as outlined in Decision 06/QD-TTg dated January 6, 2022, by the Prime Minister of the Government of Vietnam approving the Scheme to develop applications of population data, identification, and electronic authentication to serve the national digital transformation period 2022 - 2025, with a vision to 2030.

Vietnam Social Security has issued Official Dispatch 1665/BHXH-TCKT dated May 31, 2024, on implementing the social insurance agency to transfer the payment of pensions and monthly social insurance payout through personal accounts for beneficiaries (Official Dispatch 1665/BHXH-TCKT attached) in 05 Social Insurance agencies in the provinces and cities directly under the Central Government (hereinafter referred to as provincial Social Insurance): Ho Chi Minh City, Da Nang, Nam Dinh, Dien Bien, Soc Trang and plans to implement nationwide in the near future. During the implementation process in 05 provincial Social Insurance agencies, issues remained leading to unsuccessful electronic payment orders: errors from beneficiary data such as the Provincial Social Insurance not promptly updating the bank codes in the TCS Software, outdated codes being canceled resulting in many electronic payment orders being returned as errors; beneficiary names in non-Unicode fonts with special characters causing the bank to identify as strange characters and return payment orders as errors; incorrect beneficiary account numbers…

To ensure accurate and prompt implementation serving the beneficiaries, Vietnam Social Security requires the provincial Social Insurance agencies to undertake the following tasks:

- The provincial Social Insurance agencies to develop specific plans, review, and update fully and accurately the beneficiary account information (Name, account number, bank opening the account; bank code); review beneficiary data in the TCS software to ensure compliance with the required format to execute payment orders. Note the cases where the name and account number are invalid as follows: The beneficiary account name does not contain special characters such as parentheses (), periods (.), slashes (/)... For example: Nguyen Thi Hong (Nguyen Anh Hong); the account number does not contain characters like letters, periods (.), slashes (/), spaces ( )...; closed account numbers, using ATM card numbers, Identification accounts in place of bank account numbers...

- Currently, the provincial Social Insurance agencies are implementing Coordination Regulation No. 2286/C06-TCKT dated March 22, 2024, between Vietnam Social Security and the C06 Department-Ministry of Public Security on implementing the process to develop cashless payment in the disbursement of pensions and social insurance payout based on the national database on population. For a large number of new account openings, it is required to update them accurately from the first month of the payment method conversion in the TCS software to avoid errors like above when executing payment orders.

- Coordinate with the banks where the provincial Social Insurance agencies open deposit accounts to review beneficiary account information matching the beneficiary account information stored in the banking systems, and request the banks to appoint relevant contact points directly to prepare for the execution of electronic payment orders to each beneficiary smoothly, minimizing errors, and promptly resolve issues when they arise. During the review process, if the incorrect account information is due to the beneficiary, notify the beneficiary immediately to adjust the information as per regulations.

- Officers at the Social Insurance agencies directly executing payments must be proficient in the process and electronic payment order operations.

The provincial Social Insurance agencies are required to seriously implement the instructions in this document. Provincial Social Insurance agencies are responsible if the payment transfer fails due to data errors from the Social Insurance agency. Depending on the readiness of the preparations in each locality and the operational capacity of the professional software; Vietnam Social Security will direct the roadmap to expand the implementation of the social insurance agency's monthly payment transfer of pensions and social insurance payout through personal accounts for beneficiaries and will provide evaluation and feedback/praise for the performance results of the provincial Social Insurance agencies.

Refer to the detailed content in Official Dispatch 1905/BHXH-TCKT issued on June 19, 2024.

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