Circular No. 110/1991/TT-NHNN on the rules for bank payment transactions

CIRCULAR

OF THE STATE BANK OF VIETNAM

Guidelines for Implementing Bank Payment Rules

To implement the bank payment rules issued pursuant to Decision No. 101/NH-QĐ dated July 30, 1991 of the Governor of the State Bank, the Central State Bank hereby provides specific guidelines as follows:

 

PART I
REGARDING GENERAL PROVISIONS

1. Conditions for economic organizations, budgetary agencies, and individuals (hereinafter collectively referred to as customers) to conduct payments through banks (the term "bank" used in this circular refers to banking organizations or the State Treasury):

1.1. Customers must have an account at a bank, with sufficient balance on the account to ensure timely and fair settlement with the selling entity (beneficiary).

1.2. Strictly comply with all provisions of the payment rules and the guidelines set forth in this circular, including the use and procedures for payment documents, and transaction procedures with the bank as prescribed by the State and the Governor of the State Bank.

1.3. All payment documents submitted by customers to the bank must be prepared on forms provided by the bank; they must be fully completed, clearly written, and accurately filled out according to the prescribed elements; the first letter of the amount in words must be capitalized and placed immediately at the beginning of the first line without skipping lines or spaces between letters, and no corrections, erasures, or cut-and-paste alterations are allowed; and they must bear the stamp and signature of the account holder or the accounting manager (or a person authorized to sign on behalf of the account holder or accounting manager), matching the sample stamp and signature registered with the bank.

1.4. The bank has the right to refuse or not accept payment documents if the customer violates any of the payment rule provisions and shall not be liable for any losses resulting from the payment or disputes arising due to the customer's violation of these provisions.

Disputes arising in such cases shall be resolved by legal authorities (state economic arbitration or court).

2. Responsibilities of the bank in conducting payments through the bank:

2.1. Must provide promptly and adequately all types of payment document forms to customers as required and in accordance with regulations.

2.2. Conduct inspections and supervision of the account holder's payment capacity, handle violations promptly; guide customers on the use and completion of payment document procedures.

2.3. Accurately and timely update all payment transactions, ensuring prompt and secure asset transfers.

If errors, delays, or loss occur, the bank must compensate the customer for damages in accordance with the payment rules.

3. All types of ink and paper used in payment documents issued by banks must comply with the regulations of the Central State Bank; before issuance, banks must submit samples to the Central State Bank for approval. The Director of the Economic Planning Department of the State Bank is responsible for approving payment document samples in accordance with the payment rules. The Accounting Department Director approves samples related to accounting payment transactions and inter-bank payment (inter-bank notification forms).

4. In cases where payments are made outside the banking system but involve accounts at the State Bank, banks must use the State Bank's seals to match the content and nature of the payment method.

5. To ensure smooth customer payments with deposit accounts at banks, commercial banks, investment and development banks, and state treasuries must maintain a minimum balance in their settlement accounts at the State Bank equivalent to the safe level of deposit balances.

6. In all cases of lost, missing documents, or errors and delays in payments, the parties involved must prepare a record detailing the reasons, causes, the unit and person causing the error, the unit and person responsible, the extent of damage, the degree of penalty or material compensation... to be handled strictly.

 

PART II
PROCEDURES FOR DOCUMENTS AND ACCOUNTING TRANSACTIONS OF
PAYMENT FORMS

A. CHECK PAYMENT FORM

I. Transfer Check.

1. Scope and principles of transfer check payment:

1.1- Transfer checks are used for payments between customers having accounts at the same bank or at two different banks within the same or different systems that participate in direct clearing or directly exchange documents daily.

1.2- Principles of transfer check payment:

- Debit the paying unit (buyer) first.

- Credit the receiving unit (seller) afterward.

1.3- For a transfer check payment within a banking system to credit first, it must:

+ Verify the legality and validity of the check.

+ Confirm the paying unit's ability to pay (confirmation from the buyer's bank).

+ Based on specific regulations of the Commercial Bank General Director, Investment and Development Bank General Director, or the State Treasury Bureau Chief.

1.4- Transfer checks cannot be transferred to each other, including blank checks or issued checks.

2. Procedures for transferring transfer checks to customers:

2.1- When receiving checks from the warehouse to prepare for transferring to customers or for use, the bank's accounting department must record the entry in account 9970 "Checks" and perform the following procedures:

+ Count the number of checks received from the warehouse (sheets and books) and verify the serial numbers and numbers of each check in the books to ensure they match the serial numbers and quantities recorded on the warehouse exit form. Hand over the seal to the payment officer.

And record:

Debit Account 9000 (temporary advance for business operations - sub-account for check recipients)

Credit Account 940.

At the same time, record Account 9970 (the standard price of one check is one unit).

+ Proceed to write or stamp (pre-engraved) the name and code of the bank on each check in the book (in the line serving the paying party) for the newly received checks from the warehouse.

+ Record in the check transfer tracking ledger (Appendix Model No. 07) all the checks received from the warehouse.

2.2 Only endorse transferable cheques to units having deposit accounts at the Bank and to individuals holding cheque endorsement request forms issued by the account holder (or by the authorized representative of the account holder). The cheque endorsement request form must be filled out according to the prescribed model (Annex Model No. 08) and must include all necessary elements, with the signature of the person directly receiving the cheque on the request form.

The person receiving the cheque must present their identification along with the cheque endorsement request form for the Bank to check when endorsing the cheque.

2.3 The Chief Accountant of the Bank is responsible for directly processing the cheque endorsements so that the cheque sellers can execute them.

Each endorsement shall only be for one (1) book of cheques and shall only be made again once the previous book of cheques purchased by the customer has been fully used or only has no more than two (2) remaining sheets.

- The cheque endorser (stamp seller) must carefully check the cheque endorsement request form, the identification of the person purchasing the cheque, and the usage of the previously purchased cheque book by the customer before proceeding with the cheque endorsement procedure.

2.4 Before delivering the cheque to the customer, the cheque endorser must write the name and account number of the customer on all sheets in the cheque book and record it in the cheque endorsement tracking ledger.

- Require the cheque recipient to sign the cheque endorsement tracking ledger, then hand over the cheque to the customer.

2.5 The customer (cheque recipient) must count and check the serial number, amount, and quantity of sheets in the cheque book. Verify again the name and account number of their unit recorded on the cheque; if there are any errors, they must report to the Bank to exchange for another cheque book.

If the person purchasing the cheque does not perform the counting, and a shortage of cheque sheets occurs leading to exploitation, the purchasing unit will bear full responsibility for any resulting losses.

- The cheque endorsement request form must be kept together with the receipt for cheque sale proceeds (credit entry in Account 9000) and filed in the journal voucher record.

Accounting entries:

Debit Account 9970.

And credit Account 130 or the account of the cheque purchasing unit.

Credit Account 9000.

3. Procedures for issuing transferable cheques:

Transferable cheques are issued by the paying unit (buyer) to be paid to the beneficiary unit (seller).

Cheques must be written in ink that does not smudge, fade, or run, and must not be written in red ink. All elements on the cheque must be clearly, accurately, and completely recorded:

+ The amount in figures and words must comply with the above regulations.

+ Date must be written in words, year in figures.

+ Clearly record the name and account number of the beneficiary unit.

+ Stamp clearly, with the signature of the account holder and the Chief Accountant matching the registered samples at the Bank.

+ No corrections, erasures, or pasted alterations are allowed on the cheque.

- The purchasing unit may not sign and stamp blank cheques (cheques without elements filled in); if the purchasing unit violates this rule, leading to exploitation, the buyer will suffer the loss.

In case the purchasing unit signs and stamps blank cheques, if discovered, the Bank may reclaim all remaining cheque sheets from the customer.

4. Procedures for clearing transferable cheques:

- When the selling unit receives a transferable cheque from the buyer, they must carefully check all elements on the cheque before delivering goods or services. In cases where the buyer's payment reliability is questionable or the cheque amount is large, to ensure payment and asset security, the selling unit should verify the cheque's payment capability with the Bank serving the issuing unit before accepting the cheque and delivering goods.

- If the cheque is valid, require the recipient to sign and clearly write their name, ID number, and date on the back of the cheque before delivering goods, based on the cheque, prepare a cheque submission list (Annex Model No. 09) to submit to the Bank serving the unit or the Bank serving the buyer.

The cheque submission list must have the signature and stamp of the beneficiary unit.

- The seller only accepts cheques that correctly record the name and account number of their unit as the beneficiary; if the cheque incorrectly records the name or account number of their unit, they will not accept it. The Bank serving the selling unit will not pay the selling unit for cheques that incorrectly record the name or account number of the selling unit.

- Upon receiving the cheque submission list and the cheques (from the Bank serving the buyer or the Bank serving the seller), the Bank checks and reconciles the cheques with the list, signs and stamps one copy, and returns it to the cheque submitter (only accepting cheques written in accordance with regulations and still within their payment validity period). If there are errors on the cheque submission list, correct the list; for invalid cheques, handle them according to regulations and correct the cheque submission list before signing and stamping to return one copy to the customer as a receipt for the cheque.

4.1 In the case where both the buyer and seller have accounts at the same Bank, the following procedures apply:

- Use the transferable cheque as a debit entry for the buyer's account.

- Use one copy of the cheque submission list as a credit entry for the seller's account.

- One copy of the cheque submission list sent to the seller serves as a notice of credit.

Accounting Entry: Debit Account of the Paying Unit.

Credit Account of the Selling Unit.

4.2 In the case where the buyer and seller maintain accounts at different Banks (within the same or different banking systems and within the same district, city, town, province, city, special administrative region participating in clearing and direct exchange of documents), the following procedures apply:

- The selling unit (beneficiary) prepares a cheque submission list for each Bank serving the buyer (each buyer's Bank prepares a separate cheque submission list), signs and stamps all copies of the cheque submission list, and submits them to their own Bank or the Bank serving the buyer.

- The Bank's procedures for receiving the cheque submission list and cheques follow the above regulations.

- In the case where the selling unit submits the cheque submission list and cheques to the Bank serving the selling unit (seller), the Bank serving the selling unit must directly transfer the cheques and cheque submission list to the Bank serving the buyer. When transferring to the Bank serving the buyer, the Bank serving the selling unit must keep a record of cheque delivery and receipt (Annex Model No. 10), recording all details and obtaining the signature of the Bank serving the buyer on this record when transferring the cheques.

- When receiving transfer cheques from the bank serving the seller or directly from the selling entity, the bank serving the buyer must check and verify the elements on the cheque, the account number of the cheque issuing entity, the buyer's signature, and the sufficient balance in the buyer's account to cover the cheque amount. If the conditions for payment are met, proceed as follows:

Depending on the method of payment between banks, prepare the appropriate payment voucher (document):

+ If the payment is made through the State Bank, prepare two copies of the payment voucher (according to Appendix Model No. 11).

+ If the payment is settled through mutual offsetting according to the agreed participation in offsetting payments, prepare two copies of the offsetting payment voucher (according to Appendix Model No. 12).

+ In case of inter-bank payment (where both banks belong to the same system), issue an inter-bank notification form.

These vouchers or inter-bank notification forms are based on the deposit cheque submission lists of the paid cheques.

Use the cheque as the debit entry document for the buyer's account.

Use the newly prepared voucher (Model No. 11 or 12, or the inter-bank notification form) as the credit entry document for the appropriate account (State Bank deposit account, offsetting account, or inter-bank account). One copy of this voucher, along with two copies of the deposit cheque submission list, should be sent to the relevant bank (State Bank or the bank serving the beneficiary entity).

And record:

Debit the account of the cheque issuing entity (buyer).

Credit Account 791 - Deposits at the State Bank.

or Account 820 - Offset Settlement.

or Account 830 or 850 - Outgoing Inter-bank (within the system).

- In cases where the issued cheque exceeds the available balance, adjust the total amount on the cheque deposit submission list, strike out the cheque amount that cannot be cleared due to exceeding the balance before preparing the payment voucher or offsetting payment voucher...

- Cheques that do not have sufficient balance for clearance shall be retained by the bank serving the buyer and processed once the balance becomes sufficient, including both the cheque amount and the penalty.

Record in Account 9963 "Cheque Issued Exceeding Balance".

- Calculate penalties for cheques issued exceeding the balance:

+ Penalty for issuing over the balance

The available balance on the deposit account is the balance at the time when the buyer's bank receives the cheque. The penalty for issuing over the balance is recorded as bank business income.

+ Late payment penalty:

The number of days for late payment penalty is calculated from the date the buyer's bank receives the cheque until the date it clears the cheque. The late payment penalty amount is transferred to the selling entity.

- When the buyer's account has sufficient funds in the deposit account:

Record out of Account 9963

And record: Debit the buyer's deposit account (both the cheque amount and the penalty)

Credit the appropriate account (cheque amount and late payment penalty)

Credit Account 960 (penalty for issuing a cheque over the balance).

4.3- At the bank serving the seller, upon receipt of one copy of the payment voucher model No. 11 or No. 12 or inter-bank notification form accompanied by two copies of the cheque deposit submission list, after verification, record:

Debit Account 719 "Deposits at the State Bank"

or Account 820 "Offset Settlement"

or Account 831 or 851 "Incoming Inter-bank" (within the system)

Credit the beneficiary's account.

- Copy of the payment voucher model No. 11 or No. 12 (or inter-bank notification form) serves as the debit entry document for the appropriate account.

- One copy of the cheque deposit submission list serves as the credit entry document for the seller's account.

- One copy of the cheque submission list sent to the seller serves as a notice of credit.

4.4- In cases of payment through the deposit account at the State Bank, the State Bank processes:

- Based on the cheque deposit submission lists transferred by the bank serving the buyer, prepare two copies of the payment voucher model No. 11 and record:

Debit the deposit account of the bank serving the buyer.

Credit the deposit account of the bank serving the seller.

- Process the documents:

+ Copy of the payment voucher model No. 11 prepared by the bank serving the buyer serves as the debit entry document for the deposit account of the bank serving the buyer.

+ One copy of the payment voucher model No. 11 prepared by the State Bank serves as the credit entry document for the deposit account of the bank serving the seller.

+ One copy of the payment voucher model No. 11 along with the cheque deposit submission lists sent to the bank serving the seller.

II. Guarantee Cheque

Banks may guarantee cheques only in the following cases:

+ Cheques for payment between two buying and selling entities that open accounts at the same bank.

+ Cheques for payment within the scope of participating banks in offsetting payments and direct exchange of documents.

+ Cheques for payment between customers who have accounts at branches of the same banking system (within and outside the province).

1. Procedures for issuing guaranteed cheques:

- Each time there is a request for a guaranteed cheque, the buyer must prepare three copies of the cheque mandate form, complete with all necessary elements, and submit them to the bank where the account is opened. The entity must stamp and sign on all copies of the cheque mandate form on the front of the cheque (for entities that frequently request guaranteed cheques) so the bank can process the guarantee each time.

Customers requesting occasional guaranteed cheques (including those requesting from a payable account or a transfer cheque) must submit three copies of the completed cheque mandate form to the bank for the issuance of a guaranteed cheque. The guaranteed cheque will be written and signed by the bank on the front of the cheque.

- After verifying the elements on the cheque mandate form and checking the deposit account balance, if the conditions for issuing a guaranteed cheque are met, the bank serving the buyer proceeds as follows:

+ Enter the account number on the debit and credit sides of the cheque mandate form.

+ Sign and stamp on the designated area on the back of the cheque (for cheques where the account holder has already signed and stamped on the front) or sign and stamp on the front of the cheque (for cheques where the bank needs to process the issuance).

+ Stamp GUARANTEE on the front of the cheque;

+ Hand over the completed guaranteed cheque to the customer;

+ Record:

Debit the buyer's deposit account

Credit Account 3610 - Deposits for clearing guaranteed cheques.

+ Processing of Documents:

Copy 1 of the cheque mandate form serves as the debit entry document for the buyer's account.

Copy 2 of the cheque mandate form is sent to the buyer as a debit notice.

Copy 3 of the cheque mandate form serves as the credit entry document for Account 3610 "Deposits for clearing guaranteed cheques".

2. Procedures for clearing guaranteed cheques.

2.1. Upon receiving sight drafts for acceptance, the selling unit must also conduct verification and comparison as with transfer checks mentioned above, particularly the seal and signature of the bank guaranteeing the draft, identification papers, and other documents of the recipient (if necessary, contact the bank before delivering goods to the buyer). After completing the inspection, request the recipient to present identification, sign and clearly write their name on the designated area at the back of the draft before delivering the goods.

Based on the sight draft, the selling unit also prepares a check submission list (Form No. 09) as with transfer checks mentioned above to submit to its serving bank or the bank that issued the guarantee.

2.2. Payment of sight drafts

2.2.1. In case both the buying and selling units have accounts at the same bank:

After verifying and checking the draft against the submission list to ensure legitimacy and accuracy, the bank records the date of receipt on all copies of the submission list, signs and stamps one copy to immediately issue a receipt to the person submitting the draft. The draft and submission list copies are processed as follows:

- Sight drafts serve as debit entries to Account 3610.

- One copy of the submission list serves as a credit entry to the selling unit's account.

- One copy of the submission list is sent to the selling unit as a notice of credit.

And record:

Debit Account 3610

Credit Account of the Selling Unit.

2.2.2. In case the buying and selling units have accounts at two different banks participating in net settlement and direct exchange of documents:

The selling unit must prepare separate submission lists for each bank serving the buyer to submit to its own serving bank or the bank issuing the guarantee.

The bank receiving the draft and submission list from the selling unit processes them similarly to transfer checks mentioned above (point 4.2).

At the bank guaranteeing the draft (the bank serving the buyer), record:

Debit Account 3610

Credit Account 719 deposits with the State Bank.

or Account 820 - Offset Settlement.

At the bank serving the selling unit, record:

Debit Account 719 deposits with the State Bank or Account 820 settlement offset.

Credit Account of the Selling Unit.

If payment of the sight draft goes through an account with the State Bank, then at the State Bank receiving the document, process and record it as in point 4.4 of the above section on transfer checks.

2.2.3. In case of sight draft payments between customers having accounts at two branches of the same banking system:

The General Director (Director) of commercial banks, investment and development banks, and the Director of the State Treasury Bureau shall guide subordinate units to implement in accordance with the conditions and characteristics of their banking systems, but must absolutely ensure asset safety.

III. Fixed amount check book.

- Each fixed amount check book is used for payment to one (one) main economic unit. Retail stores, counters, or dependent units within the same main economic unit may only receive fixed amount checks within the same check book.

The buyer unit may not return fixed amount checks in this check book to an economic unit under a different main economic unit.

- The selling unit (beneficiary) is responsible for checking the balance of the fixed amount check book before delivering goods, accepting only fixed amount checks whose amounts fall within the remaining balance of the check book. If the selling unit does not check the balance of the fixed amount check book and accepts insufficient or overdrawn fixed amount checks, the selling unit will bear the loss due to the lack of funds to cover the checks.

- The unit (customer) opening the fixed amount check book must securely keep the checks, bearing losses equivalent to lost money if they are lost.

- Fixed amount check books can only be opened in the following cases:

+ Both the buying and selling units have accounts at the same bank.

+ Both the buying and selling units have accounts at two different banks participating in net settlement and direct exchange of documents.

+ Both the buying and selling units have accounts at banks within the same banking system.

1. Procedures for opening a fixed amount check book:

- Customers requesting to open a fixed amount check book must prepare three copies of a payment authorization form to submit to their serving bank to deduct the fixed amount from their account.

Clearly state the name, account number, and address of the selling unit in the payment authorization form.

- The bank opening the fixed amount check book must follow these procedures:

+ When issuing fixed amount checks from the warehouse, follow the same procedures as when issuing transfer checks from the warehouse for sale (point 2.1).

+ When transferring the fixed amount check book to the customer, record all elements on all checks in the book including:

Name of the check issuer (buyer unit)

Name of the selling unit, account number, and address of the selling unit.

Record the fixed amount on the first page and sign and stamp the bank's seal in the designated place.

+ Obtain the customer's signature in the check transfer tracking book, then hand over the fixed amount check book to the customer.

Process the copies of the payment authorization form as follows:

Copy 1 serves as a debit entry to the buyer's account.

Copy 2 is sent to the buyer as a notice of debit.

Copy 3 serves as a credit entry to Account 3611 "Funds held for fixed amount check payments."

And record:

Debit Buyer's Account

Credit Account 3611

For the accounting of the proceeds from the transfer of checks:

Debit Account 130

or the buyer's deposit account

Credit Account 9000

And record an outflow from Account 9970.

2. Procedures for issuing fixed amount checks:

- When issuing fixed amount checks, the account holder or authorized representative may only issue checks within the remaining balance of the fixed amount check book.

- The procedure for writing fixed amount checks is the same as for transfer checks, but after writing, the writer must record the amount on the designated area of the stub and update the new balance.

3. Procedures for settling fixed amount checks:

- When the selling unit receives checks, it must verify the elements on the check, the identification of the recipient, and the balance of the fixed amount check book (if necessary, contact the bank) before accepting the check and delivering goods. Request the recipient to record the number, date, and sign on the designated area at the back of the check.

- The procedure for submitting fixed amount checks to the bank for payment is similar to the payment of transfer checks and sight drafts as specified above.

- Bank processing procedures:

+ At the bank serving the seller: conduct verification, comparison, and processing similar to transfer checks and sight drafts. However, in necessary cases, contact the bank that issued the fixed amount check book before paying the seller.

If both the buying and selling units have accounts at the same bank, record:

Debit Account 3611

Credit Account of the Selling Unit.

If the buying and selling units have accounts at two different banks participating in net settlement and direct exchange of documents, record:

Debit Account 820

Credit Account of the Selling Unit.

If the buying and selling units have accounts at two branches of the same banking system, record:

Debit Account 830 or Account 850

Credit Account of the Selling Unit.

At the bank serving the buyer (the bank issuing the fixed amount cheque book):

If two purchasing units and account-opening banks participate in direct settlement and document exchange, then record:

Debit Account 3611

Credit Account 820

If two purchasing and selling units open accounts at two banks within the same system, then record:

Debit Account 3611

Credit Account 831 or 851

Note: In the case of inter-bank transactions, the fixed amount cheque is retained at the seller's bank. The seller's bank must prepare a cheque list recording the Debit through the inter-bank link, which may be accompanied by a photocopied cheque to send to the bank issuing the fixed amount cheque for payment verification.

Additionally, the General Director (Director) of commercial banks, investment and development banks, and the Director of the State Treasury Department may specify additional procedures for issuing and clearing fixed amount cheques within their banking systems to ensure asset safety.

4. Settlement of fixed amount cheques.

When the validity period of the fixed amount cheque book expires or the cheque book has been opened but not used, or upon request from the purchasing unit, the bank issuing the fixed amount cheque must require the purchasing unit to return all unused blank cheques (white cheques) to the bank. The bank must reconcile and verify the number of issued cheques, the remaining number, and process the cancellation of these cheques for destruction and prepare accounting vouchers for the remaining balance:

Debit Account 3611

Credit Purchasing Unit Account (the unit that opened the fixed amount cheque book)

5. Handling cases of issuing fixed amount checks exceeding the balance:

Handle penalties as if overdrawn on a transfer cheque.

Simultaneously, the bank must immediately notify the unit that issued an overdrawn cheque.

B. FORM OF PAYMENT BY LETTER OF AUTHORIZATION FOR PAYMENT
(TRANSFER - TRANSFER CHEQUE)

I. Letter of Authorization for Payment

1. Procedures for processing letter of authorization for payment.

- The paying unit must establish four copies of the letter of authorization for payment according to the model issued by the bank and submit it to the bank serving them. All copies of the letter of authorization for payment must include complete elements: seals and signatures must match those registered with the bank.

- The bank's payment officer, upon receiving the customer's letter of authorization for payment, in addition to checking the elements, must compare: seals, signatures on the letter of authorization for payment, and check the deposit account balance of the paying unit. If:

+ The letter of authorization for payment is established incorrectly (incorrect or missing elements, seals, signatures...) or the account does not have sufficient balance, return it to the paying unit. When returning, issue a receipt for document delivery and require the customer to sign for receipt.

+ The letter of authorization for payment meets the conditions for payment, the payment officer must record the date received, account number Debit, Credit on all four copies (if both the buyer and seller have accounts at the same bank) or record the account number Debit, Credit on copy 1 and 2 (if the buyer and seller have accounts at different banks) and proceed as follows:

1.1- In the case where both the buyer and seller have accounts at the same bank:

- Process the letters of authorization for payment:

+ Copy 1 serves as evidence to debit the paying unit's account (buyer - transferring money).

+ Copy 2 sent to the paying unit to report the debit.

+ Copy 3 serves as evidence to credit the beneficiary's account (seller).

+ Copy 4 sent to the beneficiary to report the credit.

- Accounting entries:

Debit Account of the paying unit.

Credit Account of the beneficiary.

1.2- In the case where the buyer and seller have accounts at different banks (different systems or different districts, cities, provinces, special economic zones):

- At the bank serving the seller: based on the letter of authorization for payment, prepare appropriate lists according to model number 11, 12 or inter-bank notification forms and proceed as follows:

+ One list (model number 11, 12 or copy 3 of the inter-bank notification form) serves as evidence to credit the appropriate account;

+ Copy 1 of the letter of authorization for payment serves as evidence to debit the paying unit's account;

+ Copy 2 of the letter of authorization for payment sent to the paying unit to report the debit;

Copies 3 and 4 of the letter of authorization for payment attached to one list model number 11 if transferred through the State Bank or list model number 12 if directly settled or copy 1 of the inter-bank notification form if within the same system... to be sent to the bank serving the seller.

And record:

Debit Account of the paying unit

Credit Account of deposits at the State Bank.

Or Account 820 for settlement.

Or Account 830 or 850 (inter-bank transfer).

- At the bank serving the seller: upon receiving the above transfer, after completing the review, proceed as follows:

+ List model number 11, 12 (or copy 1 of the inter-bank notification form) serves as evidence to debit accounts 719, 820 (or 831, 851).

+ Copy 3 of the letter of authorization for payment serves as evidence to credit the beneficiary's account.

+ Copy 4 of the letter of authorization for payment sent to the beneficiary to report the credit.

- In the case of transferring through the State Bank or branch, the State Bank (or branch) will prepare a list (model number 11 or inter-bank notification form) and proceed as follows:

+ If an inter-bank notification form needs to be prepared:

At Bank A record:

Debit Account of deposits at the State Bank.

Credit Account 830 (inter-bank transfer out).

At Bank B record: Debit Account 831 (inter-bank transfer in)

Credit Account of deposits at the bank serving the beneficiary.

+ If a list model number 11 needs to be prepared, record:

Debit Account of deposits at the bank serving the paying unit.

Credit Account of deposits at the bank serving the beneficiary.

1.3- The paying unit may request the bank to transfer funds by mail or electronically, and the beneficiary may be a unit or an individual.

If transferring to an individual, the recipient must provide identification; on the letter of authorization for payment, clearly state the name, ID number, issuance date, and issuing authority of the identification.

In the case of electronic transfer, copies 3 and 4 of the letter of authorization for payment, Bank A attaches copy 3 of the inter-bank notification form, Bank B must prepare two additional electronic notification forms or attach copies 3 and 4 of the letter of authorization for payment.

II. Transfer Cheque

Transfer cheques are applied for payments between banks within the same banking system (within and outside the province). If the payment involves different banking systems, the procedure must involve transferring the transfer cheque through the State Bank or its representative office.

The paying unit must present the transfer cheque directly to the bank indicated on the cheque for payment processing. The bank only issues transfer cheques to individuals with valid identification and upon request from the account holder.

1. Procedures for issuing transfer cheques.

- Customers requesting payment by transfer cheque must submit three copies of the letter of authorization for payment to their serving bank (account-opening bank). In the letter of authorization for payment, clearly state: Name, ID number, issuance date, and issuing authority of the identification of the person holding the transfer cheque. The content section (summary) should clearly state the request for a transfer cheque and the purpose of the transfer.

- The bank serves the transferring unit after checking the payment order form, identification, and customer account balance. If the conditions for issuing a transfer check are met, it shall process as follows:

1.1- If the transfer check is to be paid within the same banking system:

- Issue a hand-written transfer check from its own banking system.

- Calculate and record the security code according to regulations.

- Require the recipient to sign on the back of the check stub.

- Deliver the check to the customer.

Process three copies of the payment order form:

+ Copy 1 serves as the debit voucher for the transferring unit's account.

+ Copy 2 sends to the transferring unit as a debit notice.

+ Copy 3 serves as the credit voucher for Account 3612 deposit to cover the transfer check and record:

Debit Account of the transferring unit's deposit.

Credit Account 3612 deposit to cover the transfer check.

- Upon receiving the debit notice copy along with the duplicate of the issued transfer check from the paying bank, after verifying the check number and amount, if correct, use the duplicate of the issued transfer check as the debit voucher for Account 3612 to record:

Debit Account 3612 deposit to cover the transfer check.

Credit Account 831 or 851 incoming debit.

1.2- If the transfer check is to be paid outside the same banking system:

- The bank serving the transferring unit will transfer funds from the transferring unit's deposit account to the State Bank (or branch) for the State Bank to issue the transfer check:

+ At the bank serving the transferring unit:

Use Copy 1 of the payment order form as the debit voucher for the transferring unit's account.

Use Copy 2 of the payment order form to send to the transferring unit as a debit notice.

Prepare two copies of Form 11 for:

One copy of Form 11 serves as the credit voucher for the account at the State Bank.

One copy of Form 11 with Copy 3 of the payment order form and identification sent to the State Bank.

And record:

Debit Account of the transferring unit.

Credit Account 719 deposits with the State Bank.

+ At the State Bank (or branch):

Upon receiving Form 11, Copy 3 of the payment order form, and identification, after verifying all factors and customers, proceed to issue the transfer check, calculate the security code, sign, stamp, and obtain the customer's signature on the back of the check stub before delivering it to the customer and record:

Debit Accounts of commercial banks, investment and development banks, state treasury deposits.

Credit Account 3612 deposit to cover the transfer check.

Record Form 11 as the debit voucher for the accounts of commercial banks, investment and development banks, state treasury deposits.

Copy 3 of the payment order form serves as the credit voucher for Account 3612 "Deposits to cover transfer checks."

- Upon receiving the debit notice copy along with the duplicate of the issued transfer check, after verification and inspection, record:

Debit Account 3612.

Credit Account 831.

Use the duplicate of the issued transfer check as the debit voucher for Account 3612.

2. Procedures for processing transfer checks:

- Transfer checks are only valid for payment within their respective banking systems.

- Only banks within the banking system that issues the transfer check can process it. Transfer checks from other banking systems cannot be processed.

When receiving two copies of the transfer check directly submitted by the customer, the receiving bank must thoroughly check all elements on the check (effective date, name of issuing bank, paying bank, beneficiary's name, holder's name, ID number, ID date), verify the security code, compare the signature sample of the issuing bank, and ensure the ID of the check holder matches the information on the check. In case of discrepancies, retain the check and inquire the issuing bank via telegraph; the issuing bank must respond via telegraph and confirm with the security code. Upon receiving the response, if correct, the paying bank will then pay the customer.

After completing the verification and comparison, based on the purpose of using the check amount, require the customer to complete necessary procedures and the bank will process accordingly:

+ Use the transfer check to prepare a debit notice to the issuing bank.

+ The main copy of the transfer check serves as the credit voucher for the payable account.

+ Send the duplicate of the transfer check along with Copy 1 of the debit notice to the issuing bank.

And record:

Debit Account 830, 850 (debit notice sent).

Credit Account 362 (payable account).

Subsequently:

If the customer requests cash withdrawal, record:

Debit Account 362 (payable account).

Credit Account 130 (cash in vault).

If the customer requests issuance of a guarantee check, after completing the issuance procedure, record:

Debit Account 362 (payable account).

Credit Account 3610 (guarantee check).

If the customer requests transfer to the purchasing unit's account or the beneficiary's expense account, record:

Debit Account 362 (payable account).

Credit Suitable Account (beneficiary).

C. FORMS OF LETTER OF CREDIT PAYMENT

1. Procedures for opening a letter of credit:

1.1- The buyer prepares and submits six copies of the letter of credit application form to the serving bank (where the account is held). The letter of credit must include all required elements: contract or purchase order number, date, month, year, stamped and signed according to the registered model at the bank. Simultaneously, the buyer must prepare a registration form with the authorized representative's signature at the seller's side (using the deposit account registration form model). It must clearly indicate the representative's full name, position, ID number, date, and have two sample signatures of this representative. The account holder must sign and stamp to confirm, and the representative must submit this form to the serving bank at the seller's side (the paying bank) as a basis for control when making payments.

1.2- In cases where both the buying and selling units have accounts in the same banking system:

The clearing officer of the serving bank for the buyer must record the receipt date, account number, and calculate the security code, sign, and stamp all six copies of the letter of credit application form, then process:

And record:

Debit Buyer's Account

Credit Account 360 (sub-account opened according to the buyer).

Process the six copies of the letter of credit application form:

- Copy 1 serves as the debit voucher for the buyer's account.

- Copy 2 sends to the buyer as a debit notice.

- Copy 3 serves as the credit voucher for Account 360 - deposit for opening a letter of credit.

- Copies 4, 5, and 6 of the letter of credit application form are sent to the serving bank of the seller on the same day.

1.3- In cases where both the buying and selling units have accounts in different banking systems: the buyer follows point 1.1 above.

- Validity period of the letter of credit.

- The amount the seller requests to be paid within the letter of credit.

- Factors and procedures for the invoice list.

After thorough verification, the bank processes the payment for the selling entity.

- Record the date and month of payment on all four copies and enter the account number for Debit and Credit on copies 1 and 2 of the invoice list.

- Based on copies 5 and 6, the letter of credit opening document, and the invoice list, prepare a debit notice for the outgoing shipment.

And record: Debit Account 9962 - Letter of Credit received.

Simultaneously record: Debit Account 830 or 850 (outgoing shipment).

Credit Account of the Selling Unit.

Handling documents:

- Copies 1 and 2 of the invoice list, along with the invoice and copy 6 of the letter of credit opening document, and copy 1 of the debit notice for the outgoing shipment, send to the bank where the account 360 is opened.

- Copy 3 of the invoice list, together with copy 5 of the letter of credit opening document, serve as evidence for crediting the account of the selling entity.

- Copy 4 of the invoice list sent to the selling entity as a credit notice.

In case the letter of credit is opened at the State Bank, and the selling entity has an account at another bank, the selling entity still needs to submit the invoice list to the State Bank. After verification, the State Bank will process the above procedures and based on copies 3 and 4 of the invoice list, prepare two copies of the invoice list according to form number 11 to transfer to the commercial bank or development bank serving the seller and handle:

At the State Bank:

Recording:

Debit Account 9962 - Letter of Credit received.

and Debit Account 830 - Outgoing shipment.

Credit Account deposits of the commercial bank or development bank serving the seller.

Handling documents:

- One copy of the invoice list form number 11, together with copies 3 and 4 of the invoice list, send to the commercial bank serving the selling entity.

- One copy of the invoice list form number 11, together with copy 5 of the letter of credit opening document (with payment date noted...), serve as evidence for crediting the deposit account of the commercial bank or development bank.

- Copies 1 and 2 of the invoice list and copy 6 of the letter of credit opening document, together with copy 1 of the debit notice for the outgoing shipment, send to the bank where account 360 is opened (Letter of Credit Deposit).

Selling entity: When receiving copies 3 and 4 of the invoice list, along with one copy of the invoice list form number 11, record:

Debit Account 719 - Deposits at the State Bank.

Credit Account of the Selling Unit.

Handling document copies:

Copy 3 of the invoice list serves as evidence for crediting the account of the selling entity.

Copy 4 of the invoice list sent to the selling entity as a credit notice.

Copy of the invoice list form number 11 serves as evidence for debiting Account 719.

2.4. At the bank opening the letter of credit (opening account 360).

Upon receipt of the debit notice for the outgoing shipment and copy 6 of the letter of credit opening document, along with two copies of the invoice list and the invoice, after verification, record:

Debit Account 360 - Letter of Credit Deposit.

Credit Account 831 or 851 - Incoming shipment.

Handling documents:

Copy 6 of the letter of credit and copy 1 of the invoice list serve as evidence for debiting Account 360.

One copy of the invoice list, along with the invoices, sent to the purchasing entity.

Since the letter of credit only pays once, if there is remaining money in Account 360, the bank prepares a settlement voucher for the balance of Account 360 to transfer back to the account previously set aside for opening the letter of credit of the purchasing entity and record:

Debit Account 360 - Letter of Credit Deposit.

Credit Account of the purchasing entity.

D. FORM OF COLLECTION PAYMENT.

1. Procedures for issuing a collection instruction.

After delivering goods according to economic contracts or purchase orders (which clearly state payment by collection method), the selling entity bases on the invoice and delivery documents signed by the buyer or service recipient, prepares four copies of the collection instruction accompanied by complete invoices and documents for the bank serving them. On the collection instruction, all factors must be fully recorded, including the date, month, year of the economic contract or purchase order, with the stamp and signature of the account holder of the selling entity.

2. Procedures for handling by the bank serving the seller.

2.1. Upon receipt of four copies of the collection instruction, along with invoices and delivery documents, after verifying the factors, the bank's payment officer records the date and month of receipt on all copies of the collection instruction, the bank manager signs and stamps it, and handles:

Retain copy 4 of the collection instruction and record its entry into Account 9960 - Collection Instruction Sent.

Send copies 1, 2, 3 and the invoices and documents to the bank serving the buyer.

2.2. Upon receipt of copy 3 of the collection instruction and the credit notice for the incoming shipment (if payment is within the same banking system) or form number 11 or 12 (if payment is outside the banking system), after verification and reconciliation, record:

Debit Account 9960.

And record:

Debit Account 831 or 851 (if payment is within the same system).

or Debit Account 820 or 719 (if payment is outside the system).

Credit Account of the selling entity.

Copy 3 of the collection instruction serves as evidence for crediting the account of the selling entity.

Copy 4 of the collection instruction sent to the selling entity as a credit notice.

3. Procedures for handling by the bank serving the buyer.

Upon receipt of three copies of the collection instruction, along with invoices and documents sent from the seller's bank, the buyer's bank must verify the factors on the collection instruction and invoices, particularly the buyer's signature on the invoice, and reconcile with the buyer's notification to the bank regarding the signing of economic contracts or purchase orders that are to be settled by collection method. If the conditions for payment are met, handle:

3.1- In case the buyer's account has funds available for payment:

The payment officer of the bank serving the buyer records the account number for Debit and Credit on copies 1 and 2 of the collection instruction, records the date and month of payment, and handles:

- If both the buyer and seller have accounts in the same bank:

Debit Account 9960.

Debit Account of the buyer.

Credit Account of the Selling Unit.

+ Copy 1 of the collection instruction serves as evidence for debiting the buyer's account.

+ Copy 2 of the collection instruction, along with the invoices, sent to the buyer as a debit notice.

+ Copy 3 of the collection instruction serves as evidence for crediting the seller's account.

+ Copy 4 of the collection instruction sent to the seller as a credit notice.

- If both the buyer and seller have accounts in different banks within the same system:

The buyer's bank, based on copy 3 of the collection instruction, receives the credit notice for the incoming shipment and:

Debit Account of the buyer.

Credit Account 830 or 850.

+ Copy 1 of the collection instruction serves as evidence for debiting the buyer's account.

+ Copy 2 of the collection instruction, along with the invoices, sent to the buyer as a debit notice.

+ Copy 3 of the collection instruction, along with copy 1 of the credit notice for the incoming shipment, sent to the bank serving the seller. The bank serving the seller, upon receipt, handles according to point 2.2 above.

- If both the buyer and seller have accounts in different systems participating in clearing and direct document exchange, the bank serving the buyer prepares form number 12 and records:

Debit Account of the buyer.

Credit Account 820 (clearing).

+ The first two copies of the payment mandate and invoices shall be processed as above.

+ The third copy of the payment mandate along with Form No. 12 shall be sent to the Bank serving the seller.

- If the purchasing and selling units open accounts at different banking systems that do not participate directly in real-time settlement with each other, then the Bank serving the buyer must prepare two copies of Form No. 11 for settlement through the State Bank.

* At the commercial bank serving the buyer:

Account entry: Debit Buyer's account

Credit Account No. 719.

Handling documents:

+ The first two copies of the payment mandate and invoices shall be processed as above.

+ One copy of Form No. 11 serves as the credit entry voucher for Account No. 719.

+ The third copy of the payment mandate along with one copy of Form No. 11 shall be sent to the State Bank where the Account No. 719 is maintained.

* At the State Bank: upon receipt and completion of verification of the third copy of the payment mandate and one copy of Form No. 11, issue a debit notification and record:

Debit Accounts of commercial banks, investment and development banks.

Credit Account No. 830.

Handling documents:

+ The third copy of the payment mandate along with the first copy of the debit notification shall be sent to Bank B.

+ Form No. 11 serves as the debit entry voucher for the account of commercial banks, investment and development banks...

3.2- In case the buyer’s account does not have sufficient funds to settle the payment mandate:

- The buyer’s bank, after recording Account No. 9961 (unpaid payment mandate), shall notify the buyer.

- When the buyer’s account has sufficient funds to settle the payment mandate, debit Account No. 9961 and calculate late payment penalties to transfer both the debt and penalty to the seller.

Formula for calculating late payment penalties:

- The number of days overdue is calculated from the date the buyer’s servicing bank receives the payment mandate to the date it settles the payment mandate.

- Note: The payment mandate will only be settled once. If the buyer’s account only has enough funds to pay the debt but not the penalty, the buyer’s servicing bank shall deduct and transfer the debt first, informing the seller’s servicing bank that the penalty will be paid later.

When the buyer’s account has funds, the buyer’s servicing bank must deduct and transfer the penalty to the seller according to regulations.

 

PART III
REGARDING THE PROCEDURES FOR BANK TRANSACTIONS
BETWEEN BANKS

1. Methods of transactions between banks.

1.1- Transactions between banks within the same system are carried out through the following methods:

- Inter-bank settlement;

- Netting settlement;

- Opening deposit accounts at other banks within the same system for settlement;

- Collection and payment agency services.

1.2- Transactions between banks in different systems are carried out through the following methods:

- Settlement through accounts opened at the State Bank;

- Netting settlement organized by the State Bank for each province, city, and special economic zone;

- Opening deposit accounts at other banks for settlement;

- Collection and payment agency services between banks with regular settlement relationships.

2. Procedures for bank transactions between banks.

2.1- Inter-bank settlement procedures are implemented according to the inter-bank settlement regulations issued by the Governor of the State Bank and applied to all banks participating in inter-bank settlement within the system;

2.2- Netting settlement procedures are implemented according to the netting settlement rules and techniques (a separate document will provide guidance);

2.3- Settlement through deposit accounts opened at the State Bank is carried out according to current regulations and the procedures specified in Part II of this circular. The accounting vouchers for deposit accounts at the State Bank are the summary of payment vouchers (according to Form No. 11 of this circular).

2.4- Settlement through deposit accounts opened at other banks: there must be a written agreement between the two directly related banks and approval from their respective main banks, while adhering strictly to the principles of account opening and usage, timely settlement, accurate updates, secure assets, and no misuse of funds or mutual debts.

2.5- Collection and payment agency services: there must be a strict written agreement and commitment between the two banks to ensure trust in settlements. Both parties must reconcile and settle accounts regularly.

 

PART IV
IMPLEMENTATION

1. Based on the bank transaction regulations and this circular, state-owned banks, the National Treasury Bureau, and joint-stock commercial banks shall provide specific guidelines and direct subordinate units to properly implement bank transactions. The accounting entries guided in this circular apply to the banking system, while units under the National Treasury Bureau shall use accounts according to the guidelines of the National Treasury Bureau.

2. The General Directors of commercial banks, investment and development banks, joint-stock commercial banks, and the Director of the National Treasury Bureau are responsible:

- Directing, urging, and inspecting the implementation of settlement work by subordinate units to ensure prompt, timely, accurate, and secure asset transactions.

- Being responsible for concretizing guiding documents without contravening the provisions in the bank transaction regulations and this circular.

This circular takes effect from October 1, 1991, and replaces all previous guiding documents on this matter.

Any amendments or supplements to this circular shall be regulated by the Governor of the State Bank.