Regulations on Foreign Currency Payments and International Payments from July 01, 2024, according to the Latest Decree
Guidelines for Foreign Currency and International Payments from July 1, 2024, According to the Latest Decree
According to Article 5 of Decree 52/2024/ND-CP regarding foreign currency and international payments, the regulations are as follows:
- Payments in foreign currency and international transactions must comply with the provisions of this Decree, the laws on foreign exchange management, user data protection, cybersecurity, tax administration, anti-money laundering laws, combating terrorism financing, prohibiting the proliferation of weapons of mass destruction, and international treaties and agreements on payments to which Vietnam is a party. The application of business practices is performed following Article 3 of the Law on Credit Institutions.
- Commercial banks and foreign bank branches are permitted to participate in the international payment system after meeting the conditions stipulated in Article 21 of Decree 52/2024/ND-CP.
- Foreign organizations providing payment services and intermediary payment services to non-resident customers and foreign residents in Vietnam for transactions of goods and services in Vietnam must do so through commercial banks or foreign bank branches that have been approved by the State Bank of Vietnam to participate in the said foreign organization’s international payment system.
- Organizations providing financial switching services connected with international payment systems to carry out international financial switching services must meet the conditions stipulated in Article 22 of Decree 52/2024/ND-CP.
- Organizations providing intermediary payment services (excluding those providing financial switching services) may provide intermediary payment services to customers for transactions of foreign goods and services; the execution and settlement of these international payment transactions must be done through commercial banks or foreign bank branches that have been approved by the State Bank of Vietnam to conduct foreign exchange business in the international market.
- Parties involved in international payment transactions are responsible for providing full, accurate, and prompt information to meet the regulatory requirements of the Vietnamese government.
Regulations on Foreign Currency and International Payments from July 1, 2024, According to the Latest Decree
Conditions for Commercial Banks to Participate in the International Payment System from July 1, 2024
According to Article 21 of Decree 52/2024/ND-CP regarding the conditions for commercial banks’ participation in the international payment system:
Conditions for Participation in the International Payment System by Commercial Banks and Foreign Bank Branches
1. Permission has been obtained to conduct basic foreign exchange operations in the domestic and international markets.
2. There are policies and procedures for managing risks related to money laundering, financing terrorism, and the proliferation of weapons of mass destruction that meet the requirements of laws on anti-money laundering, combating terrorism financing, and prohibiting the proliferation of weapons of mass destruction when participating in the international payment system.
3. There is an information system that meets the requirements for governance, safety, and security under Vietnamese law; internal regulations exist for the standards of connecting to international payment systems.
4. The organization operating the international payment system is legally established and operating abroad.
Commercial banks participating in the international payment system must meet the conditions under Article 21 of Decree 52/2024/ND-CP.
How Are the Banking Activities of Commercial Banks Regulated from July 1, 2024?
According to Article 107 of the Law on Credit Institutions 2024 regarding the activities of commercial banks:
- Accepting demand deposits, term deposits, savings deposits, and other types of deposits.
- Issuing deposit certificates.
- Extending credit in the following forms:
+ Lending
+ Discounting and rediscounting
+ Bank guarantee
+ Issuing credit cards
+ Domestic factoring; international factoring for banks permitted to conduct international payments
+ Letters of credit
+ Other forms of credit extension as regulated by the Governor of the State Bank of Vietnam.
- Opening payment accounts for customers.
- Providing payment instruments.
- Providing payment services through the following accounts:
+ Carrying out domestic payment services, including checks, payment orders, collection orders, remittance orders, transfers, bank cards, collection services, and disbursement services.
+ Carrying out international payment services after obtaining written approval from the State Bank of Vietnam; other payment services as prescribed by the Governor of the State Bank of Vietnam.
Decree 52/2024/ND-CP takes effect from July 1, 2024.
Law on Credit Institutions 2024 takes effect from July 1, 2024.
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