CIRCULAR

AMENDING A NUMBER OF ARTICLES OF CIRCULAR NO. 19/2016/TT-NHNN DATED JUNE 30, 2016 BY GOVERNOR OF THE STATE BANK OF VIETNAM ON BANK CARDS

Pursuant to the Law on the State Bank of Vietnam dated June 16, 2010;

Pursuant to the Law on Credit Institutions dated June 16, 2010 and Law on amendments to the Law on Credit Institutions dated November 20, 2017;

Pursuant to the Government’s Decree No. 101/2012/ND-CP dated December 22, 2012 on non-cash payment; Government’s Decree No. 80/2016/ND-CP dated July 01, 2016 amending a number of Articles of the Decree No. 101/2012/ND-CP; Government’s Decree No. 16/2019/ND-CP dated February 01, 2019 amending a number of Articles of Decrees on business conditions under state management of the State Bank of Vietnam;

Pursuant to the Government’s Decree No. 16/2017/ND-CP dated February 17, 2017 on functions, duties, powers and organizational structure of the State Bank of Vietnam;  

At the request of the Director General of the Payment Department;

The Governor of the State Bank of Vietnam hereby promulgates a Circular amending a number of Articles of the Circular No. 19/2016/TT-NHNN dated June 30, 2016 by the Governor of the State Bank of Vietnam on bank cards.

Article 1. Amendment to a number of Articles of Circular No. 19/2016/TT-NHNN dated June 30, 2016 by Governor of the State Bank of Vietnam on bank cards

1. Clause 7, Clause 19, Clause 23 and Clause 25 of Article 3 are amended and Clause 8a and Clause 8b are added to Article 3 as follows:

 “7. “non-physical card” means an immaterial card existing in electronic form, containing the information prescribed in Article 12 of this Circular and provided by a card issuer for the cardholder to conduct transactions on the Internet and via mobile applications. Non-physical cards are not physical cards with online or mobile payment option and may be converted into physical cards per cardholder’s request.”.

 “8a. “domestic card present transaction” means a type of card transaction where a card issued in Vietnam is used to make a transaction at an automated teller machine (“ATM”) or via a point-of-sale terminal (“POS terminal”) in Vietnam.

8b. “fictitious transaction at a merchant” refers to the use of a card or card information to pay for goods or services without actual occurrence of any sale of goods or provision of services.”.

“19. “international card association” means an organization which is established and operated in a foreign country under such country's law, and has entered into agreements with card issuers, acquirers, switching organizations and/or other relevant parties concerning cards assigned bank identification numbers by international card associations (“cards with international BINs”) or cards containing bank identification numbers of other countries (“cards with foreign BINs”) in accordance with Vietnamese law and international commitments.”.

 “23. “bank identification number" (“BIN”) refers to a set of numbers used to identify card issuers. It may be assigned by the State Bank according to regulations on BIN assignment, use and management, by an international card association or by another country. For cards with international BINs and cards with foreign BINs, these BINs shall be assigned, used and managed in compliance with regulations of the international card associations and foreign countries assigning them.”.

“25. “card payment agreement” means an agreement on card payment concluded between an acquirer and a merchant or an international card association or a switching organization (if any).”.

2. Clause 2 Article 8 (amended by Clause 2 Article 1 of the Circular No.26/2017/TT-NHNN) is amended as follows:

“2. Directly conduct or enable another person to conduct a fraudulent card transaction or fictitious transaction at a merchant.”.

3. Point a Clause 1 Article 12 is amended as follows:

 “a) Name of the card issuer (abbreviated name or trade logo). In case abbreviated names or trade logos of multiple organizations (such as the card issuer, a card issuance partner of the issuer, a switching organization, an international card association and relevant parties) appear on the card, it shall be made clear that the card is issued by the card issuer (or is property of the card issuer) to avoid confusion;”.

4. Clause 2 Article 16 (amended by Clause 7 Article 1 of the Circular No.26/2017/TT-NHNN) is amended as follows:

 “2. For principal cardholders being organizations: Organizations eligible to open checking accounts may use debit cards. Organizations being juridical persons duly established and existing under Vietnamese law may use credit cards, debit cards and prepaid cards. A cardholder being an organization may authorize an individual to use its card in writing or permit an individual to use its supplementary card as prescribed in this Circular.”.

5. Point b Clause 3 Article 16 is amended as follows:

“b) A person from 15 to under 18 years old whose legal capacity is not completely or partially limited may use debit cards, credit cards and prepaid cards;”.

6. Points b and c Clause 3 Article 17 are amended as follows:

“b) Credit cards shall be used to pay for goods and services; and to deposit and withdraw cash as agreed upon between the cardholder and the card issuer. Credit cards shall neither be used to transfer money to checking accounts, debit cards and prepaid cards nor credit such accounts and cards;

c) Anonymous prepaid cards shall be used to pay for permitted goods and services via all POS terminals in Vietnam’s territory; and shall not be used to conduct card transactions on the Internet or via mobile applications or to withdraw cash. Deposit into anonymous prepaid cards is regulated by Clause 2 Article 14 of this Circular;”.

7. Point dd Clause 3 Article 17 (amended by Clause 8 Article 1 of the Circular No.26/2017/TT-NHNN) is amended as follows:

“dd) Cards may be used to pay for goods and services permitted by Vietnamese law, including those purchased overseas; except the cases specified in Point c herein.”.

8. Point b Clause 3 Article 18 (amended by Clause 9 Article 1 of the Circular No.26/2017/TT-NHNN) is amended as follows:

 “b) Request merchants to provide documents proving the lawfulness of their business when concluding agreements with them. Acquirers shall formulate criteria for selection of qualified merchants and conduct first-time and periodical (quarterly or annually) evaluation and classification of merchants that wish to accept card payment as suitable to their characteristics and scope of business;”

9. Clause 5 Article 18 is amended as follows:

“5. When a card issuer, acquirer, switching organization or clearing organization enters into an agreement on bank cards, such agreement must include responsibilities of relevant parties for compliance with regulations of laws on foreign exchange management, personal data protection, privacy, security of documents, card information, card transactions and accounts of cardholders.”.

10. Clause 3 Article 21 is amended as follows:

“3. Acquirers licensed to conduct foreign exchange transactions are permitted to process payments of cards with international BINs and cards with foreign BINs.”.

11. Clause 5 Article 22 is amended as follows:

“5. Acquirers must not discriminate between cards whose BINs are assigned by the State Bank and cards with international BINs or cards with foreign BINs; or enter into any agreement on restriction or prevention of acceptance of transactions conducted through co-branded cards with other entities.”.

12. Clauses 2, 3 and 5 Article 24 are amended as follows:

“2. For domestic card present transactions using cards with international BINs and cards with foreign BINs between card issuers or acquirers and international card associations, switching for these transactions shall be conducted through a payment gateway of a switching organization licensed with the State Bank.

3. Clearing of transactions using cards with international BINs and cards with foreign BINs shall be conducted as agreed upon between the card issuer, the acquirer and relevant parties.”.

“5. Switching organizations and clearing organizations shall connect their systems with card issuers, acquirers and international card associations directly as agreed upon by all parties,  ensuring safe and continuous switching services and other services provided for connected member entities and international card associations, and compliance with regulations of relevant laws”.

13. Point c is added to Clause 1 Article 31 and Clause 2 Article 31 is amended as follows:

“c) Cooperate with the Banking Supervision Agency, State Bank branches of provinces and central-affiliated cities and relevant units in inspection of compliance with regulations in this Circular upon request.”.

 “2. Banking Supervision Agency; and State Bank branches of provinces and central-affiliated cities shall:

Carry out inspection of compliance with regulations in this Circular, take actions against violations within their competence and notify the Payment Department and relevant units of the results.”.

14. Clause 2 Article 32 (amended by Clause 13 Article 1 of the Circular No.26/2017/TT-NHNN and provided for in Clause 6 Article 1 of the Circular No. 41/2018/TT-NHNN) is amended as follows:

“2. Clause 2 Article 24 of this Circular comes into force from January 01, 2021.”.

15. The Appendix enclosed with the Circular No. 19/2016/TT-NHNN (superseded according to regulations in Clause 12 Article 1 of the Circular No. 30/2016/TT-NHNN) is superseded by the Appendix enclosed with this Circular.

Article 2. Transitional clauses

Card specimens issued prior to the effective date of this Circular shall contain information required by regulations applicable at the time of their issuance. Information on cards issued by card issuers or changed after this Circular takes effect is regulated by this Circular.

Article 3. Implementing responsibilities

Head of Office of the State Bank, Director General of the Payment Department, heads of relevant affiliates of the State Bank, Directors of State Bank branches of provinces and central-affiliated cities, Chairpersons of Boards of Directors, Chairpersons of Members’ Councils, general directors (directors) of credit institutions and foreign bank branches, switching organizations and clearing organizations shall implement this Circular.

Article 4. Effect

1. This Circular takes effect from April 01, 2020.

2. Clause 14 Article 1 of this Circular comes into force from January 01, 2020./.

APPENDIX

(Enclosed with Circular No. 28/2019/TT-NHNN dated December 25, 2019 by Governor of the State Bank of Vietnam amending a number of Articles of Circular No. 19/2016/TT-NHNN dated June 30, 2016 on bank cards)

BANK CARD SPECIMEN REGISTRATION

To: State Bank of Vietnam (Payment Department)

Name of card issuer:

- In Vietnamese: ……………………………………………………………………………………

- In foreign language: ……………………………………………………………………………..

- Abbreviated name: ………………………………………………………………………………

Address of headquarters: …………………………………………………………………………

Phone number: …………………………………………Fax: …………………………………….

Phone number (unit or person in charge): ………………………………………………..

To implement Clause 2 Article 10 of the Circular No. 19/2016/TT-NHNN dated June 30, 2016 by Governor of the State Bank of Vietnam on bank cards, we would like to register the following bank card specimen(s):

1. Card specimen information

2. Target customers and card issuance conditions

3. Roles and responsibilities of card issuer and relevant parties (card issuance partners (if any)) for issuance of registered card(s)

4. Color scans of front and back of card(s) (for physical cards)

5. Supplementary card specimen information (if any)

(Card issuer shall specify whether any supplementary card is to be issued)

We take full responsibility before the law for the accuracy and honesty of information provided in this registration form.

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