Social Security Sector Accelerates Non-Cash Payment

10:01:05 AM | 30/7/2020

The payment of pensions, social insurance allowances and unemployment insurance benefits will be made into personal bank accounts (ATM cards) to better serve beneficiaries and increase their satisfaction with greater convenience. With strategic solutions, the social security sector has not only realized the goal of expanding modern payment methods, but also contributed positively to the effective deployment of the national financial strategy to 2025, with a vision to 2030.

Following the directions of the Government and the Prime Minister in Decision 241/QD-TTg dated February 23, 2018; Decision 149/QD-TTg dated January 22, and Directive 22/CT-TTg dated May 26, 2020, the social security sector has paid special attention to accelerating payment of pensions, social insurance allowances and unemployment insurance benefits through personal bank accounts (ATM card) to better serve beneficiaries.

Ensuring safety, reducing time and costs

In addition to payment in cash, all 63 provinces and cities across the country are paying monthly pensions, social insurance allowances and unemployment insurance benefits into ATM card accounts of many beneficiaries. With this method, pensioners, social insurance and unemployment insurance beneficiaries do not need to go to given locations to get their benefits and sign onto payment documents. Especially in the current context of complicated development of the Covid-19 pandemic, bank payment has helped beneficiaries reduce travel and direct contact, and guarantee safety and social distancing as directed by the Prime Minister.

For workers entitled to benefits of sickness, maternity, health convalescence and rehabilitation, one-off social insurance and unemployment benefits, non-cash payment method also prevents employers from using or delaying such benefits for them, thus ensuring that beneficiaries get their benefits in full and in time. For payment agencies, this method ensures cash safety in transit and keeping, avoids omissions and errors, reduces pressure and time as compared to the payment conducted via employers.

Currently, benefit payment via ATM bank accounts is uniformly implemented in all localities as follows:

- Monthly pensioners and social security beneficiaries have their benefits transferred by the Post Office to their personal bank accounts within the same day or no later than the next working day after it gets the payment list from the social security agency.

- Workers and their relatives immediately get their benefits of sickness, maternity or health rehabilitation via bank accounts after the social security agency and banks at the service compare account information and numbers.

- Workers get their unemployment allowances of the first month from the social security agency right after it has the payment list. The payment will be transferred to their bank accounts within five days from the given date in the payment list from the second month.

Beneficiaries encouraged to get insurance benefits through personal bank accounts

In the past time, the social security sector has made efforts to apply various solutions to increase the number of beneficiaries receiving benefits of social insurance, health insurance and unemployment insurance via personal bank accounts for better service. In addition to assigning targets to local social security agencies, the Vietnam Social Security (VSS) has actively expanded communications and information on the Government's and Prime Minister's instructions on payment of social security benefits through the banking system on the mass media, with the focus placed on good points of this payment mode. The Vietnam Social Security has requested the Vietnam Post Corporation to direct its Post Offices at all levels to coordinate with social security agencies and issue directive documents to inform beneficiaries of bank payment utilities to encourage more to use this method.

To encourage beneficiaries to receive pensions and social insurance and unemployment insurance benefits through their ATM card accounts, social security agencies will support them with the cost of opening personal bank accounts for the first time and the cost of transferring money to their personal bank account (if any). The Vietnam Social Security has proposed the State Bank of Vietnam direct the banking system to have preferential treatments for pensioners, social insurance and unemployment insurance beneficiaries to receive money through their personal bank accounts (like reducing fees of ATM card opening, bill payment, cash withdrawal and transactions); install more ATMs, especially in remote areas, for workers and social security beneficiaries to easily access and use banking services anytime, anywhere; provide enough money; and regularly maintain ATMs.

With the efforts of the social security sector, the number of social insurance and unemployment insurance beneficiaries receiving benefits through personal bank accounts has increased significantly: In 2019, 33.8% beneficiaries in urban areas used this method, an increase of 9.76% over 2018, fulfilling 67.6% of the target set for 2021 (reaching 50% as per Resolution 02/NQ-CP) and 34% of benefit value was paid into personal bank accounts (higher than the target of 20% by 2020 as assigned by the Prime Minister in Decision 241/QD-TTg).

According to the Vietnam Social Security, to expand non-cash payment, the most important goal of the social security sector in the coming time is to assign tasks and introduce solutions to increase the rate of pensions, social insurance and unemployment insurance benefits paid via the banking system; speed up payment of pensions, social insurance and unemployment insurance benefits with simple, convenient and low-cost services to better serve beneficiaries in rural areas and remote areas. VSS will strive to accomplish its targets of social security payment services specified in the Government's Decision 241/QD-TTg and the Government's Resolution 02/NQ-CP dated January 1, 2019. Accordingly, to successfully achieve the above objectives, the Vietnam Social Security will further coordinate with relevant bodies, especially the Vietnam Post Corporation, the State Bank of Vietnam and authorities at all levels to pay social insurance and unemployment insurance benefits through the banking system to better serve beneficiaries.

Hopefully, with appropriate solutions, the social security sector will not only successfully expand modern payment methods, but also help realize the National Comprehensive Financial Strategy to 2025, with a vision to 2030, and the Prime Minister's Directive 22/CT-TTg dated May 26, 2020 on promoting non-cash payment solutions in Vietnam to bring practical benefits to beneficiaries and facilitate socioeconomic modernization.

Source: Vietnam Business Forum