Circular No. 39/2014/TT-NHNN guiding payment intermediary services

CIRCULAR

Guidelines for Payment Intermediary Services

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Pursuant to the Law on the State Bank of Vietnam No. 46/2010/QH12 dated June 16, 2010;

Pursuant to the Law on Credit Organizations No. 47/2010/QH12 dated June 16, 2010;

Pursuant to Decree No. 156/2013/NĐ-CP dated November 11, 2013, of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

BASED ON DECREE NO. 16/2017/NĐ-CP DATED FEBRUARY 17, 2017 OF THE GOVERNMENT ON THE FUNCTIONS, TASKS, POWERS, AND ORGANIZATIONAL STRUCTURE OF THE STATE BANK OF VIETNAM;

At the proposal of the Payment Department Director;

The Governor of the State Bank of Vietnam issues this Circular to guide payment intermediary services.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation and Applicability

This Circular guides payment intermediary services for organizations and individuals related to the provision and use of payment intermediary services.

Article 2. Types of Payment Intermediary Services

1. Electronic payment infrastructure services, including:

a) Financial switching service;

b) Electronic settlement service;

c) Electronic payment gateway service.

2. Payment support services, including:

a) Collection and disbursement support service;

b) Electronic money transfer support service;

c) E-wallet service.

Article 3. Explanation of Terms

In this Circular, the following terms shall be understood as follows:

1. Financial Switching Service is a service providing technical infrastructure to connect, transmit, and process electronic data to execute payment transactions through ATMs, POS terminals, the Internet, mobile phones, and other electronic transaction channels between payment service providers and/or between payment intermediary service providers.

2. Electronic Settlement Service is a service providing technical infrastructure to receive, reconcile payment data, and calculate the net amount due among participating members who are payment service providers or payment intermediary service providers, thereby facilitating settlement among relevant parties.

3. Electronic Payment Gateway Service is a service providing technical infrastructure to connect payment acceptance units with banks to facilitate customers' electronic payments in e-commerce transactions, electronic bill payments, and other electronic payment services.

4. Collection and Disbursement Support Service is a service assisting banks in executing collection and disbursement services for customers with bank accounts or bank cards at the bank through receiving, processing, sending electronic data messages, calculating the results of collections and disbursements, canceling collections and disbursements, and settling accounts for relevant parties.

5. Electronic money transfer support service is a service supporting the receipt, transmission, and processing of data in electronic money transfer transactions of banks or those entrusted by banks.

6. E-Wallet Service is a service providing customers with an identifiable electronic account established on a carrier device (such as an electronic chip, mobile phone SIM card, computer...) that allows storing a monetary value guaranteed by an equivalent deposit amount transferred from the customer's bank account to the payment service provider's guarantee account at a ratio of 1:1, and can be used as a means of non-cash payment.

7. Guarantee Payment Account is a Vietnamese dong-denominated payment account opened by a payment intermediary service provider at commercial banks to ensure the provision of payment intermediary services.

8. Acceptance unit is an organization or individual providing goods or services and accepting payments through one or more payment intermediary services.

Chapter II

LICENSE FOR PROVIDING PAYMENT INTERMEDIARY SERVICES

LICENSE FOR PROVIDING PAYMENT INTERMEDIARY SERVICES

Article 4. Issuance, Revocation, and Reissuance of the License

1. The State Bank of Vietnam (hereinafter referred to as the State Bank) shall issue, revoke, and reissue the License for Providing Payment Intermediary Services (hereinafter referred to as the License) in accordance with Articles 15 and 16 of Decree No. 101/2012/ND-CP dated November 22, 2012 of the Government on Non-Cash Payments (hereinafter referred to as Decree No. 101/2012/ND-CP).

2. An organization that is not a bank wishing to obtain the License to provide one or more payment intermediary services specified in Article 2 of this Circular must meet the conditions stipulated in Clause 2 of Article 15 of Decree No. 101/2012/ND-CP and the following physical infrastructure and technical requirements:

a) For financial switching services and electronic settlement services, the service provider must have a settlement organization to reconcile the results among related parties.

b) For services supporting customers with accounts at multiple banks, the service provider must connect to a financial switching service provider and an electronic settlement service provider.

Article 5. Procedures, Formalities, and Documents for Issuance, Revocation, and Reissuance of the License

1. The procedures for issuing, revoking, and reissuing the License shall be carried out in accordance with Article 16 of Decree No. 101/2012/ND-CP.

2. The application documents for obtaining the License for Providing Payment Intermediary Services shall comply with Clause 2 of Article 16 of Decree No. 101/2012/ND-CP and evidence demonstrating compliance with the conditions set forth in points a and b of Clause 2 of Article 4 of this Circular.

3. The application for issuance of the License shall be submitted in the form set forth in Appendix No. 01 attached hereto.

4. Organizations granted the License for providing payment intermediary services must pay the licensing fee in accordance with the provisions of the law.

Article 6. Use of the License

1. Organizations granted the License must use the correct name and operate in accordance with the contents stipulated in the License.

2. It is strictly prohibited to forge, erase, transfer, lease, lend the License; entrust or delegate another organization or individual to perform activities permitted under the License.

Chapter III

PAYMENT INTERMEDIARY SERVICES

Article 7. Risk Management, Safety, and Security Assurance

1. Payment intermediary service providers must establish and implement internal regulations and comply with the State Bank's regulations on risk management principles in electronic banking activities, comply with current laws on anti-money laundering, and other relevant Vietnamese laws.

2. Payment intermediary service providers must ensure security and confidentiality of information technology systems in banking operations and security and confidentiality of electronic banking services according to the State Bank's regulations.

3. Payment intermediary service providers must comply with legal provisions regarding the establishment, use, preservation, and storage of electronic documents in banking activities.

Article 8. Ensuring Payment Capacity

1. Organizations providing collection and disbursement support services and e-wallet services must open guarantee payment accounts to ensure the provision of these services. The balance in the guarantee payment account must be maintained at a level not lower than the total amount received from customers but not yet settled to the payment acceptance unit (for collection and disbursement support services) or the total balance of all e-wallets of customers (for e-wallet services) at the same time.

2. The payment guarantee account may only be used for:

a) Settling funds to payment acceptance units;

b) Refunding money to customers using the service upon request.

Article 9. Activities of Providing Electronic Wallet Services

1. An organization providing electronic wallet services shall not be permitted to:

a) Issue more than one (1) electronic wallet for one payment account of a customer at one bank;

b) Grant credit to customers using electronic wallets, pay interest on the balance of electronic wallets, or any other action that may increase the monetary value on electronic wallets.

2. E-wallet service providers must have tools for the State Bank to monitor in real-time the total amount of customers' funds in e-wallets and the total amount in the guarantee payment account of the e-wallet service provider at banks.

3. The act of depositing money into an electronic wallet and withdrawing money from an electronic wallet of a customer must be carried out through the customer's payment account at a bank.

Chapter IV

RIGHTS AND RESPONSIBILITIES OF THE PARTIES INVOLVED

Article 10. Rights of Organizations Providing Infrastructure Payment Services

1. Specify usage conditions; require customers to provide complete and accurate information related to the use of the service and during the use of the service; refuse to provide the service when the customer does not meet the full conditions for using the service, does not comply with the service provider's regulations, or violates other agreements.

2. To stipulate measures to ensure safety for the use of services.

3. To stipulate types and levels of fees for using services in accordance with current laws.

4. To select banks and other organizations as partners to sign contracts for providing and developing services based on ensuring safety, efficiency, and compliance with the content of the License and legal provisions.

5. Other rights according to contracts with banks, customers, and partners in accordance with legal provisions.

Article 11. Obligations of Organizations Providing Infrastructure Payment Services

1. For customers:

a) Guide customers on how to use services;

b) Resolve or respond to customer complaints and inquiries;

c) Compensate customers for losses due to technical system errors, disclosure of customer information, and other errors of the service provider organization;

d) Coordinate with customers to perform daily transaction data checks and reconciliations;

đ) Provide complete information periodically or urgently about transactions through the service provider organization's system upon customer request;

e) Announce types and levels of fees for customers before they use services.

2. Coordinate with customers and partners to implement risk management measures, ensure safety and security when using and providing services.

3. Other obligations according to contracts with banks, customers, and partners.

Article 12. Rights of Organizations Providing Support Services for Payment

1. Specify usage conditions; require customers to provide complete and accurate information related to the use of the service and during the use of the service; refuse and terminate the provision of the service when the customer does not meet the full conditions for using the service, does not comply with the service provider's regulations, or violates other agreements.

2. To stipulate measures to ensure safety for the use of services.

3. To stipulate types and levels of fees for using services in accordance with current laws.

4. To select banks and other organizations to sign contracts for providing and developing services based on ensuring safety, efficiency, and compliance with the content of the License and legal provisions.

5. Other rights according to contracts with banks, customers, and partners in accordance with legal provisions.

Article 13. Responsibilities of service providers supplying payment support services

1. For customers using the service:

a) Specify and announce the terms and conditions for using the service through appropriate channels (the organization's website providing the service, brochures, and sample contracts/sample service usage forms...). The service provider and/or cooperate with banks must agree with customers on the following issues before using the service:

- Payment methods;

- Fees and charges;

- Detailed transaction statement models provided to customers during the service usage process;

- Procedures for reporting losses and damages when using the service, complaint procedures including location, time, and methods of handling complaints;

- Refund policy including conditions, procedures, timeframes, and costs;

- Rights and responsibilities of customers;

- Customer obligations in case of incidents, losses, fraud transactions;

- Address and contact number of the intermediary payment service provider organization;

b) Guide customers on how to use the service;

c) Verify, update fully and accurately customer information registered for service usage;

d) Resolve or respond to customer complaints and requests for review;

đ) Compensate customers for losses caused by system technical errors, information leakage, and other errors of the service provider;

e) For electronic wallet services, the service provider is responsible for requiring customers to have a bank account open at a bank before using the service; provide complete information periodically and upon request about transactions, balances, and limits related to the use of the service;

2. For banks:

a) Fully and promptly fulfill all obligations arising from transactions using the service according to the agreement between the payment intermediary service provider and the bank, and in accordance with applicable laws;

b) Cooperate with banks to verify, update fully and accurately customer information registered for service usage;

c) Cooperate with banks and partners to conduct daily transaction data checks and reconciliations.

3. The service provider must enter into a written agreement with banks and partners regarding the terms of cooperation in providing services, requiring acceptance units to commit not to charge additional fees to customers when paying through payment intermediary services in any form. In case the acceptance unit does not comply with the commitment, the service provider has the responsibility to terminate the contract and require the acceptance unit to compensate customers for losses or apply other appropriate measures according to the commitments made by the parties;

4. Implement risk management measures to ensure safety and security in the provision of services.

5. Other obligations under contracts with banks, customers, and partners.

Article 14. Rights of Banks

1. Select non-bank organizations to cooperate and test one or more payment intermediary services.

2. Enter into contracts to use electronic payment infrastructure services and/or cooperate in deploying support services for payment services with payment intermediary service providers.

3. Request payment intermediary service providers to provide necessary information related to transactions conducted through payment intermediary services.

4. Other rights under contracts and service provision agreements with payment intermediary service providers.

Article 15. Responsibilities of Banks

1. Cooperate only with non-bank organizations that have been granted a License by the State Bank of Vietnam to provide payment intermediary services.

2. Coordinate with payment intermediary service providers to conduct daily transaction data reconciliation.

3. Carry out payment transactions for relevant parties in accordance with the regulations of the State Bank and the cooperation service provision contract for payment intermediary service providers;

4. Manage the balance of accounts guaranteeing payments of service support organizations in accordance with the cooperation contract signed with service support organizations and the provisions of this Circular;

5. Coordinate with payment intermediary service providers to verify, update, and ensure the completeness and accuracy of customer information registered to use payment support services.

6. Cooperate with payment intermediary service providers to guide measures, technical procedures, and security practices in payment transactions through payment intermediary services for acceptance units and customers using payment intermediary services. The bank shall be responsible for compensating customers and related parties for losses due to the bank's failure to comply with these regulations;

7. Cooperate with payment intermediary service providers to establish procedures and processes for resolving customer complaints related to payment transactions through payment intermediary services;

8. Other obligations under contracts with payment intermediary service providers, payment acceptance units, and customers.

Chapter V

REPORTING, INFORMATION DISCLOSURE AND VIOLATION HANDLING

Article 16. Reporting and Providing Information

1. Payment intermediary service providers shall report to the State Bank (through the Payment Department) quarterly and annually according to the contents required in Appendix No. 02 issued together with this Circular. The deadline for submitting periodic reports is the 5th day of the first month of the next quarter for quarterly reports and January 15 of the following year for annual reports;

2. Payment intermediary service providers and banks shall be responsible for reporting to the State Bank of Vietnam information related to payment intermediary transactions in the following cases:

a) At the specific request of the State Bank of Vietnam to serve state management purposes;

b) When there are unusual developments in activities that may affect the operations of payment intermediary service providers and banks or other related organizations and individuals;

c) When incidents occur causing interruptions in payment activities through payment intermediary services.

3. Payment intermediary service providers and banks are responsible for keeping confidential information related to payment transactions through payment intermediary services, personal information of customers, and customer payment accounts, and such information can only be provided in the following cases:

a) Upon the customer's request;

b) As prescribed by law.

Article 17. Handling Violations

Organizations and individuals violating the provisions of this Circular will be subject to administrative penalties depending on the nature and severity of the violation, and in serious cases, criminal liability may be pursued; if damage is caused, compensation must be provided in accordance with the law;

Chapter VI

IMPLEMENTATION

Article 18. Payment Department

1. Serve as the focal point for receiving and coordinating with relevant units to review applications for licenses.

2. Within fifteen working days from the date of receiving complete files in accordance with Clause 2, Article 16 of Decree No. 101/2012/NĐ-CP, the Payment Department is responsible for reviewing and sending the file to relevant Departments, Bureaus, and units under the State Bank for their comments;

3. Summarize opinions from relevant units, review the file, and submit to the Governor of the State Bank of Vietnam for a decision to grant or refuse the license.

4. Serve as the focal point for presenting to the Governor of the State Bank of Vietnam matters related to issuing, revoking, and reissuing licenses.

5. Serve as the focal point for receiving reports on the provision of payment intermediary services by payment intermediary service providers and banks.

6. Monitor and act as a liaison to advise the Governor of the State Bank on managing and supervising the provision of payment intermediary services by payment intermediary service providers;

Article 19. Information Technology Bureau

1. Within a maximum of fifteen working days from the date of receipt of the request letter from the Payment Department, the Information Technology Bureau is responsible for reviewing and evaluating and sending a confirmation letter to the Payment Department regarding the technical conditions, technological solutions, security capabilities, and technical staff ensuring the implementation of payment intermediary services of the organization applying for a license;

2. Coordinate with the Payment Department to inspect compliance with regulations on security, confidentiality, and risk management in electronic transactions by payment intermediary service providers.

Article 20. Banking Inspection and Supervision Authority

Shall conduct inspections, examinations, and supervision of organizations and individuals related to the implementation of this Circular.

Chapter VII

IMPLEMENTING PROVISIONS

Article 21. Effective Date

This Circular shall take effect from March 1, 2015.

Article 22. Transitional provisions

From the date this Circular takes effect, organizations that are not banks and have been permitted by the State Bank to pilot the provision of one or more payment intermediary services specified in Article 2 of this Circular shall be responsible for completing the necessary procedures and submitting an application for a license in accordance with Article 5 of this Circular to the State Bank for consideration;

Nine months after the effective date of this Circular, all documents of the State Bank allowing non-bank organizations to pilot the provision of payment services and payment intermediary services will become invalid;

Article 23. Responsibility for Implementation

The Director of the Office, Heads of the Payment Department, and Heads of units under the State Bank; Governors of the State Bank Branches in provinces and centrally-administered cities, Chairmen of Management Boards (Members), General Directors (Directors) of payment service providers, and payment intermediary service providers are responsible for organizing the implementation of this Circular./.