Legal basis

• Clause 9 Article 4 of the Law on the State Bank of Vietnam No. 46/2010/QH12;
• Article 15 of Decree 101/2012/ND-CP;
• Clause 8 Article 1 – Decree 80/2016/ND-CP;
• Decree 16/2019/ND-CP amending the decree stipulating business conditions within the scope of state management of the State Bank of Vietnam;
• Circular No. 39/2014/TT-NHNN dated December 11, 2014, guiding the intermediary payment services

Content

According to Article 4.9 of the Law on State Bank of Vietnam 2010, the State Bank has duties and powers: “To grant, modify, supplement or revoke establishment and operation licenses of credit institutions, licenses for establishing branches of foreign banks, licenses for establishing representative offices of foreign credit institutions and other foreign organizations with banking operations; lo grant or revoke licenses for provision of intermediary payment services for non-bank institutions; to grant or revoke licenses for provision of credit information services to organizations: to approve the acquisition, sale, division, splitting, consolidation, merger and dissolution of credit institutions according to law“. Accordingly, the Bank has the power to grant and revoke licenses to provide intermediary payment services to organizations other than banks.

According to Article 15 of Decree 101/2012/ND-CP, payment intermediary services include:

First, Provision of electronic payment facilities:

• Financial switch service ;
• Electronic clearing service;
• Electronic payment gateway service.

Second, Payment service support:

• Cash collection and cash payment services;
• Support service for wire transfer;
• Digital wallet service

Third, Other payment intermediary services as prescribed by the State bank.

The organizations not being banks that wish to provide payment intermediary services must satisfy the following requirements:

1. Having an establishment license or an enterprise registration certificate issued by a competent state agency;

2. Having the plan for provision of intermediary payment services which must be approved by a competent authority as defined in its Charter and contain, inter alia, the following:

(i) The process of technical operations of the intermediary payment service for which the application for license is submitted, including:  Name and scope of the service, target customers, conditions for using service, diagram and description of steps of the operation, cash flow from the beginning of the service to the finalization of obligations between related parties;

(ii) The mechanism for ensuring the solvency, including:  The mechanism for opening and maintaining balance on the payment guarantee account, and purposes of the payment guarantee account;

(iii) The process of internal inspection and control; risk management, security and confidentiality protection; general rules and internal regulations on anti money laundering; process and procedures for response to trace requests, complaints and denunciations

3. Having a minimum charter capital of VND 50 billion;

4. Personnel requirements:

The legal representative, General Director (or Director) of the organization applying for the license must possess a bachelor’s degree or higher or have at least 03 years of experience in one of the following areas, business administration, economics, finance, banking or law;

Deputy General Director (or Deputy Director) and holders of other key positions in the Plan for provision of intermediary payment services (including heads of departments (divisions) or holders of equivalent positions, and technicians) must possess associate degree or higher in economics, finance, banking, information technology or the area related to their in-charge professional positions

5. Technical requirements: There are facilities and technical infrastructure, information technology system and technology solutions that satisfy the requirements for provision of payment intermediary services; back-up technical system independent from the primary system that ensures the safe and continuous service provision when the primary system has problems and in accordance with regulations on safety and security of information technology system in banking operations;

6. With regard to the financial switching, clearing services, the service provider must have the payment between relevant parties settled by another service provider.

7.  With regard to payment services provided for a customer holding accounts in multiple banks, the service provider must associate with a provider of switching and clearing services licensed by the State Bank to provide such services during the process of intermediary payment services.

Above is our consultancy about this issue. If you need more detailed advice and answers as well as how to access this service, please contact directly the Deputy Director of Sales: Lawyer Nguyen Duc Trong via hotline: 0912.35.65.75, 0912.35.53.53 or call the free legal consultation hotline 1900.6575 or send a service request via email: info@hongbanglawfirm.com hoặc lienheluathongbang@gmail.com

Wishing you and your family good health, peace and success!

Best regards!