Socialist Republic of Vietnam

STATE BANK OF VIETNAM

No. 226-2002-QD-NHNN Hanoi, 26 March 2002


DECISION ISSUING REGULATIONS ON PAYMENT OPERATIONS VIA ORGANIZATIONS PROVIDING PAYMENT SERVICES


The Governor of the State Bank of Vietnam

Pursuant to the Law on State Bank of Vietnam and the Law on Credit Institutions both dated 12 December 1997;

Pursuant to Decree 15-CP of the Government dated 2 March 1993 on duties, powers and responsibilities for State administration of ministries and ministerial equivalent bodies;

Pursuant to Decree 64-2001-ND-CP of the Government dated 20 September 2001 on Payment Operations by Organizations Providing Payment Services;

On the proposal of the Director of the Department of Monetary Policy;

Decides:


Article 1

To issue with this Decision Regulations on Payment Operations via Organizations Providing Payment Services.

Article 2

This Decision shall be of full force and effect after fifteen (15) days from the date of its signing and shall replace Decisions of the Governor of the State Bank 22-QD-NH1 dated 21 December 1994 on Regulations on Non-Cash Payments and 144-QD-NH1 dated 30 June 1994 on Conditions for People's Credit Funds to Conduct Non-Cash Payments.

Article 3

The Head of the Office, heads of units of the State Bank, directors of State Bank branches in cities and provinces under central authority, directors of organizations providing payment services, and all organizations and individuals using payment services shall be responsible for implementation of this Decision.


For the Governor of the State Bank
Deputy Governor


DUONG THU HUONG


STATE BANK SOCIALIST REPUBLIC OF VIETNAM
OF VIETNAM Independence - Freedom - Happiness


REGULATIONS
ON
PAYMENT OPERATIONS
VIA ORGANIZATIONS PROVIDING
PAYMENT SERVICES

(Issued with Decision 226-2002-QD-NHNN of the Governor
of the State Bank dated 26 March 2002)


CHAPTER I

General Provisions

Article 1 Subjects and scope of applicability

1. These Regulations shall apply to the following subjects conducting payment operations:

(a) Organizations providing payment services, comprising:

- State Bank of Vietnam (hereinafter referred to as State Bank);

- Banks established and operating under the Law on Credit Institutions, namely commercial banks, development banks, investment banks, policy banks, co-operative banks and other types of banks;

- People’s credit funds;

- Non-banking credit institutions which are licensed by the State Bank to provide payment services;

- Organizations other than credit institutions which are licensed by the State Bank to provide payment services.

(b) Organizations and individuals using payment services.

2. These Regulations shall apply to both domestic and international payment operations via organizations providing payment services in the territory of Vietnam, comprising:

(a) Opening payment accounts;

(b) Conducting and using payment services;

(c) Organizing and participating in payment systems.

3. All payment operations via organizations providing payment services must comply with these Regulations and with other regulations of the State Bank on payment operations.

Article 2 Conditions for organizations other than banks to provide payment services

1. The State Treasury may open accounts and conduct payment services in accordance with these Regulations and other relevant laws.

2. The Central People’s Credit Fund may open accounts and conduct payment services in accordance with these Regulations and other relevant laws.

3. Grassroots-level people’s credit funds may open accounts and conduct payment services for their members only with a permit from the State Bank.

4. Organizations other than credit institutions may open accounts and conduct payment services only with a permit from the State Bank and upon satisfying the following conditions:

(a) They have an establishment licence or operational licence or they have been granted business registration by the competent State body;

(b) They have a plan for payment operations which evidences that:

- It is necessary for them to carry out payment services and this is closely related to their main operations;

- They satisfy the conditions for appropriate material facilities;

- They have staff with the management and professional skills necessary to conduct payment operations;

(c) They have supplied the State Bank with all information and data relevant to their application and accept liability for its accuracy and truthfulness.

Article 3 Conditions for banks and organizations other than banks to provide international payment operations

1. Banks must be authorized to conduct foreign exchange activities, must satisfy the conditions for material facilities, and must have staff with the management and professional skills necessary to conduct international payment operations.

2. Organizations other than banks may conduct international payment operations only with a permit from the State Bank and upon satisfying the following conditions:

- They are authorized to conduct foreign exchange activities;

- It is necessary for them to carry out international payment services and this is closely related to their main operations;

- They satisfy the conditions for appropriate material facilities;

- They have staff with the management and professional skills necessary to conduct international payment operations.

Article 4 Opening and using payment accounts

1. Organizations providing payment services may open accounts at the request of the following organizations and individuals, unless otherwise provided by law:

(a) Foreign credit institutions operating overseas;

(b) Vietnamese organizations and foreign organizations licensed to operate in the territory of Vietnam;

(c) Individuals being Vietnamese citizens with full civil legal capacity;

(d) Foreign individuals with full civil legal capacity pursuant to the law of their country of citizenship.

2. Organizations providing payment services shall issue their own rules on the types and characteristics of payment accounts and on the conditions and procedures for opening and using them, consistent with State Bank regulations and other relevant laws.

Article 5 Ensuring ability to make payment

1. Account owners must ensure that there is sufficient money in their payment account to effect their payment orders on the date when they make them, or in accordance with their agreement with the organization providing payment services, unless they have an overdraft arrangement as stipulated in clause 2 below.

2. Organizations and individuals using payment services may use an overdraft facility, only up to the limit set out in their written overdraft agreement with the organization providing payment services, provided that such agreement is not contrary to law.

Article 6 Foreign exchange control in payment operations

Organizations providing payment services and users of payment services must comply with the regulations on foreign exchange control of the Government and the State Bank when they open, operate, and use payment accounts.


CHAPTER II

Using and Operating Payment Services

Section 1

Payment Orders and Payment Vouchers

Article 7 Payment orders and implementing payment orders

1. Payment order means an order from an user of payment services to an organization providing payment services in the form of a paper voucher, electronic voucher, or some other form in accordance with the regulations of a competent State body, requesting that organization to conduct a payment transaction.

2. If an organization providing payment services incorrectly conducts a payment transaction other than as requested by the user of payment services in a payment order, it shall be obliged to amend such transaction.

Article 8 Payment vouchers

1. Payment vouchers shall be the basis on which a payment transaction is conducted, and may be created in the form of a paper voucher, electronic voucher, or some other form in accordance with the regulations of a competent State body.

2. The types and contents of payment vouchers; the preparation, control, circulation, storage and archiving of payment vouchers; and the respective responsibilities of users of payment services and organizations providing payment services shall be implemented in accordance with State Bank regulations and other relevant laws on payment vouchers.

Section 2

Payment Facilities and Provision of Payment Facilities

Article 9 Payment facilities

Payment facilities shall comprise:

1. Cash being paper money and coins issued by the State Bank and used as payment facilities in the territory of Vietnam.

2. Cheque being an order by an account owner to pay money, created in accordance with the provisions of law, requesting an organization providing payment services to deduct a sum of money from the deposit payment account of the owner to pay to the beneficiary named in the cheque or to the cheque holder.

3. Authorized payment order or payment order being a payment facility created by a payer and ordering payment in accordance with the form stipulated by an organization providing payment services, sent to the said organization where the payer has an account, requesting the deduction of a specific sum of money from the account of the payer to pay to the beneficiary.

4. Authorized collection order or collection order being a payment facility created by a beneficiary and ordering payment in accordance with the form stipulated by an organization providing payment services, sent to the organization authorizing it to collect a specific sum of money on behalf of the beneficiary.

5. Bankcard being a payment facility issued by an organization providing payment services and given to an user of payment services to use in accordance with the contract between the organization providing payment services and such user of payment services.

6. Other payment facilities being bills of exchange, promissory notes, and so forth, in accordance with relevant laws.

Article 10 Provision of payment facilities

1. Provision of cash payment facilities:

Organizations providing payment services shall be obliged to comply fully and promptly with requests to deposit or withdraw cash by users of payment services within the limits of their account balances and any overdraft agreed with the account owner and consistent with law.

Organizations providing payment services may reach an agreement with users of payment services on the latter providing advance notice of withdrawal of large sums.

2. Provision of cheque payment facilities shall be implemented in accordance with regulations of the Government and guidelines of the State Bank on issuance and use of cheques.

3. Provision of payment facilities by authorized payment orders, payment orders, authorized collection orders and collection orders shall be implemented in accordance with regulations of the State Bank on payment vouchers.

4. Provision of payment facilities by bankcard shall be implemented in accordance with regulations of the State Bank on issuance and use of and payment by bankcard.

5. Provision of other payment facilities shall be implemented in accordance with relevant laws.

Section 3

Domestic Payment Services

Article 11 Provision of domestic payment services

1. Domestic payment services means services in which the payment transaction is entered into, implemented and finalized within the territory of Vietnam, except for cases involving an account opened overseas or where an export processing enterprise participates.

2. Domestic payment services shall include the forms of payment stipulated in articles 12 and 17 of these Regulations.

Article 12 Payment by cheque

1. The order and procedures shall be implemented in accordance with regulations of the Government and guidelines of the State Bank on issuance and use of cheques, except that the provisions in clause 2 below shall apply to ensure liquidity.

2. The drawer of a cheque (an account owner or a person authorized by an account owner) shall be liable to ensure that there is sufficient capability to make payment on that cheque.

A cheque the liquidity of which is ensured means one which satisfies one of the two following conditions upon presentation at the organization providing payment services and servicing the payer:

- The balance in the account of the account owner is sufficient to pay the amount recorded on the cheque;

- The balance in the account of the account owner, together with the overdraft limit, is sufficient to pay the amount recorded on the cheque.

Article 13 Payment by payment order or authorized payment order

1. A payment order or an authorized payment order may be used to pay for goods or services or to remit money of an user of payment services within a single organization providing payment services or between organizations providing payment services.

2. A payment order or an authorized payment order shall include the following items:

- Words "payment order" or "authorized payment order" and a series number;

- Full name, address and account number of the payer;

- Name and address of the organization providing payment services and servicing the payer;

- Full name, address and account number of the beneficiary;

- Name and address of the organization providing payment services and servicing the beneficiary;

- Amount to be paid written in words and figures;

- Place where the payment order or authorized payment order was drawn and the date;

- Signature of the account owner or the person authorized by the account owner;

- Other items required by the organization providing payment services provided that they are not contrary to law.

3. An organization providing payment services shall reach agreement with the user of payment services on the conditions, order of payment and time-limits for payment of a payment order or authorized payment order provided that they are not contrary to law.

4. Within a time-limit not exceeding one working day from the date on which an organization providing payment services and servicing a beneficiary receives a payment order or authorized payment order from a similar organization servicing a payer, the first such organization must credit the account of the beneficiary in accordance with the request in the payment order or authorized payment order.

Article 14 Payment by collection order or authorized collection order

1. A collection order or an authorized collection order may apply to payment transactions between users of payment services who have opened accounts at the same or different organizations, depending on the arrangements agreed in the contract between the payer and the beneficiary.

2. A collection order or an authorized collection order shall include the following items:

- Words "collection order" or "authorized collection order" and a series number;

- Full name, address and account number of the person requesting collection;

- Name and address of the organization providing payment services and servicing the person requesting collection;

- Full name, address and account number of the payer;

- Name and address of the organization providing payment services and servicing the payer;

- Number of the contract (or goods order or agreement) which is the basis for the collection order, and the number of documents attached;

- Amount to be collected written in words and figures;

- Place where the collection order or authorized payment order was drawn and the date;

- Date for receipt of payment by the organization providing payment services and servicing the person requesting collection;

- Other items required by the organization providing payment services provided that they are not contrary to law.

3. An organization providing payment services shall reach agreement with the user of payment services on the conditions, order of payment and time-limits for payment of a collection order or authorized collection order, consistent with State Bank regulations.

4. Within a time-limit not exceeding one working day from the date on which an organization providing payment services and servicing a payer receives an authorized collection order from a similar organization servicing a beneficiary, the first such organization must debit the account of the payer if it contains sufficient funds to conduct the payment transaction; or notify the payer if the funds in its account are insufficient to conduct the payment transaction.

Article 15 Payment by bankcard

Payment by bankcard shall be implemented in accordance with regulations of the State Bank on issuance and use of and payment by bankcard.

Article 16 Payment by letter of credit

1. A letter of credit means a conditional written undertaking provided by a bank at the request of an user of payment services (a person applying for a letter of credit), pursuant to which the bank shall fulfil the request of the user of payment services (the person who applied for the letter of credit) to:

- Pay itself, or authorize another bank to pay, pursuant to the order of the beneficiary immediately upon receipt of a set of documents which are presented and comply with the conditions in the letter of credit; or

- Agree to pay itself, or authorize another bank to pay, pursuant to the order of the beneficiary on a fixed date in the future when it receives a set of documents which are presented and comply with the conditions in the letter of credit.

2. The opening, issuance and amendment of, and notifications, certifications, inspections of vouchers, payment, rights and obligations of parties, and so forth, with respect to payment of letters of credit shall be agreed by the parties and shall be in accordance with the current laws of Vietnam.

Article 17 Other forms of payment in Vietnam

Other forms of payment in Vietnam shall be implemented in accordance with regulations of the State Bank.

Section 4

International Payment Services

Article 18 Conducting international payment services

1. International payment services means services where the payment transaction is either:

(a) A payment transaction which is entered into, implemented or finalized overseas; or is a payment transaction involving an account opened overseas;

(b) A payment transaction in which an export processing enterprise participates.

2. International payment services shall include the forms of payment stipulated in article 19 below.

Article 19 Forms of international payment

1. Payment by letter of credit: The opening, issuance and amendment of, and notifications, certifications, inspections of vouchers, payment, rights and obligations of parties, and so forth, with respect to payment of letters of credit shall be implemented in accordance with the general rules issued by the International Chamber of Commerce (ICC) which the parties have agreed to apply and in accordance with the current laws of Vietnam.

2. Payment by international payment cheque, by international payment order or authorized payment order, by international collection order or authorized collection order, by international cards and by other forms of international payment: the order and procedures shall be implemented in accordance with international rules and practice and with agreements provided that they are not contrary to the laws of Vietnam.

Section 5

Trust Services (Authorized Collection and Payment)

Article 20 Trust services (authorized collection and payment)

1. Trust services (authorized collection) means payment services conducted by an organization providing payment services at the request of a beneficiary, aimed at achieving an immediate payment or approval for payment on a fixed date in the future by the payer. Trust services shall include receipt, processing and forwarding of collection order vouchers, their rescission, and payment of the results of collection orders at the request of an user of payment services.

Forms of trust services shall include trust cheques, trust commercial bills, trust collection orders, trust authorized collection orders and other forms of trust orders as agreed provided that they are not contrary to law.

2. Trust services (authorized payment) means payment services conducted by an organization providing payment services at the request of a person under an obligation to pay money for payment to the beneficiary.

Forms of authorized payment shall include agency payment of cards, cheques, and other agency or authorized forms of payments provided that they are not contrary to law.


CHAPTER III

Organization of and Participation in Payment Systems

Article 21 Payment systems, presiding organization and membership thereof

1. Payment system means a system organized according to general rules, conditions and standards on payment, on the basis of an agreement or regulations between the organization providing payment services which presides over the system and the direct members, in order to transfer payment obligations as between members and to conduct final settlement of such payment obligations.

2. Presiding organization of the payment system means the organization providing payment services which is responsible to organize the payment system and to either reach agreement with the direct members on or issue general operational rules, conditions and standards applicable to the payment system.

3. Direct members means members of a payment system obliged to conduct final settlement with the presiding organization of the payment system or with other direct members of all payment transactions that they have conducted for their own users of payment services or for indirect members represented by them.

4. Indirect members means members not satisfying all conditions for direct membership of the payment system and conducting payment transactions via a direct member acting as their agent, and only being obliged to conduct final settlement with such direct member.

Article 22 Organization of internal payment system

1. Internal payment system means a system established to conduct payment transactions as between direct members being subsidiaries of the presiding organization providing payment services.

2. Banks may organize an internal payment system for direct members being subsidiaries of such bank.

The general director (director) of a bank shall be responsible to organize the operation of an internal payment system and the standards for its technical facilities and operational staff; and to issue conditions, criteria and procedures for participation by members in the internal payment system, and regulations on confidentiality and anti-fraud, and professional procedures relating to operation of the system.

3. The State Treasury and the Central People’s Credit Fund may organize an internal payment system in accordance with clause 2 of this article.

4. Other organizations permitted to provide payment services which are not covered by clauses 2 and 3 of this article may organize an internal payment system when so permitted by the State Bank.

Article 23 Organization of and participation in inter-bank membership

1. A bank, the State Treasury or the Central People’s Credit Fund may organize and participate in a bilateral inter-bank payment system with another organization providing payment services by the following methods:

(a) Opening a payment account with such organization providing payment services;

(b) Permitting such organization providing payment services to open a payment account with it.

Both parties shall reach agreement on the conditions, procedures, undertakings, and provisions on payment as between them, consistent with the provisions of law.

2. Other organizations permitted to provide payment services which are not covered by clause 1 of this article may be members of an inter-bank payment system when so permitted by the State Bank.

3. The State Bank shall organize an inter-bank payment system to conduct payment transactions between direct members, being the State Bank, credit institutions and other organizations permitted to provide payment services.

The inter-bank payment system of the State Bank shall be organized by the two following methods:

(a) Offset settlements, including paper settlements and electronic settlements.

The State Bank shall regulate the conditions for membership of the settlement system and shall have the right to suspend membership if a member breaches such regulations.

The State Bank shall regulate the number of daily settlement sessions depending on the volume of daily payment transactions. Direct members shall conduct unconditional final settlement at the end of a settlement session.

(b) Payment on each occasion via the deposit account at the State Bank, including payment on paper vouchers and on electronic vouchers.

The State Bank shall regulate the conditions for membership of the payment system and shall have the right to suspend membership if any member breaches the regulations on payment on any one occasion via its payment deposit account with the State Bank.

Direct members shall conduct general final settlement immediately after effecting a payment order and the State Bank shall have the right to refuse to conduct the payment transaction pursuant to a payment order if the balance in the account of the forwarding member, together with any overdraft limit, is insufficient to conduct final settlement for such payment order.

The order for priority in paying payment orders from a deposit account at the State Bank shall be:

- An urgent payment order shall be paid first; and

- Payment orders shall be paid in the order of receipt.

If a member forwards an order but the balance in its account, together with any overdraft limit, is insufficient to conduct final settlement for such payment order, the member shall have the right to change the order for payment priority or to carry forward an order to be effected at the next session.

4. Credit institutions and other organizations providing payment services may become direct members of the inter-bank payment system organized by the State Bank if they satisfy the conditions for membership stipulated by the State Bank; and if they do not satisfy such conditions, they may become indirect members.

Article 24 Conducting final settlement and ensuring ability to make payment

1. Final settlement means paying money to a member participating in a payment system to discharge the obligation which arises to pay to such member when a payment order is sent via the system, and shall be of two types:

(a) Net final settlement which is conducted according to the results of an offset between sums receivable and sums payable with respect to each member during a settlement session; and

(b) Overall final settlement which is conducted with respect to the total of each payment order immediately after it is processed.

2. Organizations providing payment services which are direct members of the inter-bank payment system must conduct final settlement in accordance with article 23.3(a) and (b) of these Regulations.

3. If the balance in a payment account is insufficient to conduct final settlement, an organization providing payment services shall:

(a) Itself re-organize its funds or borrow from other organizations providing payment services in order to conduct final settlement;

(b) Borrow from the State Bank on the conditions of the State Bank.


CHAPTER IV

Rights and Obligations of Parties to Payment Operations

Article 25 Rights of organizations providing payment services

1. To issue rules on fees for the payment services they provide, rules on ensuring security and safety and anti-fraud measures, rules on closure of accounts which have been dormant for a long period and where the account balance falls below a fixed level, rules on overdraft limits, and other rules provided that they are not contrary to law.

2. To require users of payment services to provide relevant information during the process of using payment services.

3. To refuse to provide payment services when users of payment services fail to satisfy the conditions for use, fail to comply with the rules of the organization providing payment services, or breach other agreements.

Article 26 Obligations of organizations providing payment services

1. To conduct promptly and safely payment transactions at the request of users of payment services, to list publicly their service fees, to maintain confidentiality of information regarding accounts of users of payment services, unless otherwise provided by law, and to resolve or respond to complaints from users of payment services which are within the authority of the organization.

2. To refuse to conduct payment transactions where there is evidence of their illegal origin.

3. Not to conceal from competent State authorities the users of payment services, sums paid or other relevant information where there is evidence of illegal origin of payment transactions.

4. To provide information to account owners in accordance with article 31 of these Regulations and to report to the State Bank in accordance with article 32 of these Regulations.

Article 27 Rights of users of payment services

1. To reach agreement with an organization providing payment services on overdraft limits and other matters provided that such agreement is not contrary to law.

2. To require an organization providing payment services to provide information in accordance with article 31 of these Regulations.

3. To lodge a complaint with, and claim compensation for loss from, an organization providing payment services when the latter conducts a payment transaction later than agreed, or fails to conduct it, or conducts it incorrectly in terms of the amount or the beneficiary named in the payment order, or collects more fees than stipulated in the rules, or conducts some other act in breach.

Article 28 Obligations of users of payment services

1. To pay service fees to an organization providing payment services, to refund on time amounts plus interest paid from a payment account pursuant to an overdraft facility as agreed, and to comply with the other rules of the organization providing payment services.

2. To repay to the organization providing payment services any sum of money received without any legal basis during the course of a payment transaction conducted by the organization.

Article 29 Liability to compensate for loss

1. If through its own fault an organization providing payment services conducts a payment transaction late or incorrectly and thereby causes loss to an user of payment services, it must compensate such user of payment services at the maximum penalty interest rate on the highest loan at such organization. The number of days, the beneficiary, and the amount of fine shall be calculated as follows:

(a) For late payment, penalty days shall be calculated from the date of expiry of the correct time-limit for that particular form of payment up until the date on which the account of the user of payment services has sufficient funds;

(b) In any case of recording an incorrect debit in an account or recording an incorrect debit balance owing despite payment, penalty days shall be calculated from the date of incorrect entry up until the date on which the organization providing payment services corrects its error and the correct amount appears in the account of the user of payment services, to be calculated on the incorrect debt balance;

(c) In any case of recording an incorrect credit in an account or an amount less than that actually paid, penalty days shall be calculated from the date of expiry of the correct time-limit for that particular form of payment up until the date on which the account of the user of payment services is corrected, to be calculated on the incorrect deficit.

2. If an user of payment services or an organization providing payment services breaches the rules published by such organization, or breaches the agreements as between those two parties, the party causing loss shall be liable to compensate for it.

Article 30 Disputes and dispute resolution

1. Any dispute between an user of payment services and an organization providing payment services must first and foremost be resolved by agreement.

2. In the absence of agreement, the parties may agree to refer the dispute to a dispute resolution body to deal with it.

3. If neither of the above two agreements is reached, the concerned parties may institute legal proceedings before a judicial body.


CHAPTER V

Information, Reporting, and Confidentiality

Article 31 Information

1. Organizations providing payment services must regularly notify account owners of the balance in their accounts and of the transactions conducted.

2. Organizations providing payment services may also provide information irregularly at the request of account owners.

Article 32 Reporting

1. Organizations providing payment services must report monthly on all operational items as stipulated by the State Bank.

2. In addition to the above, organizations providing payment services must report at the request of the State Bank to assist State administration of payment operations.

Article 33 Confidentiality

Confidentiality, archiving and provision of information on amounts deposited by users of payment services shall be implemented in accordance with law.


CHAPTER VI

Dealing with Breaches

Article 34 Dealing with breaches

1. Any organization or individual breaching these Regulations shall, depending on the nature and seriousness of the breach, be subject to disciplinary action, administrative penalty or criminal prosecution.

2. If any organization providing payment services breaches these Regulations, the State Bank may suspend its operations or revoke its licence for payment operations.

3. If any user of payment services breaches these Regulations, the State Bank or an organization providing payment services may temporarily or permanently suspend the right to use payment services in accordance with law.


CHAPTER VII

Implementing Provisions

Article 35 Responsibility for implementation

General directors (directors) of organizations providing payment services shall be responsible to provide specific guidelines for professional payment operations of their subsidiary entities and to disseminate such guidelines for the information of users of payment services.

The State Bank Inspectorate shall be responsible to inspect compliance with these Regulations by organizations providing payment services.

Article 36 Amendments

The Governor of the State Bank shall make a decision on any amendment of these Regulations.


For the Governor of the State Bank
Deputy Governor


DUONG THU HUONG