Bulk Bank Account Openings Legal Under Strict Safeguards, Says Finance Ministry

Samuel Chua

15th October 2025 - 3 min read

The Ministry of Finance has clarified that the practice of opening bank accounts in bulk is legally allowed under Malaysian banking laws, provided financial institutions follow strict due diligence, customer verification, and data privacy standards.

The statement came after Pulai MP Suhaizan Kaiat raised the issue in Parliament, expressing concern over reports of accounts being created in bulk without the knowledge or consent of the intended account holders.

A Legitimate Practice When Properly Regulated

During the Dewan Rakyat’s Special Chamber session, Deputy Finance Minister Lim Hui Ying confirmed that bulk account openings are “common and legitimate” when carried out under controlled and transparent conditions.

She explained that such practices are used across both public and private sectors, including in corporate payroll systems, university financial disbursements, and government-led welfare or pension programmes.

“This method allows faster and more systematic account creation for large groups, such as new employees or students. However, consent must be obtained, and the customer must complete the full Know Your Customer (KYC) process before any account can be activated,” Lim said.

Verification Must Be Completed Within Ten Working Days

Lim also clarified that delayed customer verification is permitted only under specific, low-risk circumstances. Financial institutions must complete the verification process within ten working days.

“To manage risks during this period, transaction types and amounts must be capped. Full customer verification is mandatory before unrestricted access is granted,” she explained.

Safeguards To Prevent Fraud And Misuse

To protect consumers and prevent abuse, the government has outlined several safeguards against potential misuse of bulk account openings. These include identity verification through MyKad, biometric checks, real-time validation, and ongoing transaction monitoring.

“Accounts that do not pass the KYC or customer due diligence process are suspended or terminated. Financial institutions are also required to report suspicious transactions,” Lim said.

Banks must verify not only the identity of account holders but also any authorised representatives and, where relevant, identify the ultimate beneficial owners. Verification must rely on trusted, independent data sources.

“These measures are essential to ensure that accounts are not opened under false identities or misused for money laundering, terrorism financing, or other criminal purposes,” the ministry stated.

Bank Negara Malaysia To Enforce Compliance

Bank Negara Malaysia (BNM) is responsible for ensuring compliance with all regulatory standards governing account openings.

Lim emphasised that any institution found in breach of these requirements, especially where negligence leads to fraud, will face strict enforcement actions.

“BNM will not hesitate to act. Offending institutions may face prosecution, financial penalties, administrative sanctions, or official reprimands,” she said.

Balancing Efficiency and Security

The ministry reiterated that bulk account openings are designed to improve efficiency in handling large-scale financial needs, such as salary payments or student aid. However, this must always be balanced with the highest standards of verification and data protection.

By maintaining clear rules on customer consent, KYC procedures, and ongoing supervision, the government aims to ensure that faster account processing does not come at the expense of financial integrity or public trust.

You can also read our guide on how to spot and avoid financial scams in Malaysia.

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