Press Release on issuance of Circular No.20/2018/TT-NHNN
Hanoi, August 20, 2018 – The Governor of the State Bank of Vietnam (SBV) issued Circular No.20/2018/TT-NHNN stipulating the supervision of the payment systems, aiming at strengthening the supervision of the important payment systems by the SBV .
The new Circular is composed of 04 Chapters, 17 Articles, specifically as follows: Chapter I (General provisions), Chapter II (Supervision of important payment systems), Chapter III (Responsibilities of the relevant entities in the supervision of the important payment systems), Chapter IV (Enforcement).
- Chapter I on the General Provisions for the supervision of the payment systems, including:
+ Governing scope is the supervision of the important payment systems.
+ Subjects of application are entities operating the important payment systems; organizations and individuals involved in the supervision of the important payment systems.
+ Definitions of a payment system, an important payment system, main risks arising from the payment systems (liquidity risks, credit risks, system risks, operational risks), supervision of the payment systems… Accordingly, the important payment systems as stipulated in this Circular consist of: the National Interbank Electronic Payment System, the foreign currency payment system (operated by the Joint-stock Commercial Bank for Foreign Trade of Vietnam), the securities settlement system, the clearing system, the financial switching system.
+ The objectives of supervising the important payment systems are: (i) to ensure the security, stability and efficiency of the important payment systems; (ii) to ensure compliance with the legal regulations concerning important payment systems; (iii) promptly detecting and alerting the operating institutions to mitigate any arising risks in the process of operating important payment systems; (iv) protecting the legitimate rights and interests of customers using the payment services, improving customers’ confidence in the payment services.
+ Supervision activities include: (i) Monitoring the operations of the important payment systems, (ii) Evaluation of the important payment systems, (iii) Issuing warnings and recommendations to the institutions operating the important payment systems. The Circular also provide guidance on the information and data resources; the methods of comparison, verification, synthesis and analysis of the information and data…
+ Moreover, Chapter I also stipulates the on-site supervision, and the information provision and reporting by the institutions operating the payment systems.
- Chapter II stipulates the supervision of each important payment system, in line with the supervision operations as stipulated in Chapter I, including the main substances as follows: (i) the operational situations of the important payment systems; (ii) situations of risks and risk management of the important payment systems; (iii) the compliance with the legal regulations in relation to the management and operations of the important payment systems; (iv) changes in the operations of the important payment systems.
- Chapter III includes regulations on responsibilities of the relevant entities in the supervision of the important payment systems.
- Chapter IV clarifies the enforcement of the new Circular.
Circular No.20/2018/TT- NHNN takes effect from January 1st, 2019.
Translated by Le Hang