Vietnam Is Going Digital
Vietnam's new financial concept is as surprising as Zimbabwe's ZiG Dollar. Here's what became effective on July 1, 2024, in Vietnam.
Decree 52: What Is Decree 52 and What Are Its Key Provisions?
Decree 52 regulates non-cash payments in Vietnam and will significantly alter Vietnam's financial landscape.
What Does Decree 52 Mean by E-Money?
Decree 52 provides a clear legal definition of electronic money (e-money) in Vietnam for the first time. An electronic wallet (e-wallet) is a form of e-money in which Vietnamese Dong (VND) are stored electronically using prepaid funds provided by banks, foreign branches of banks, or IPS providers. The decree explicitly excludes virtual currencies to ensure that only regulated e-money forms are recognized for transactions.
The New Requirements for Foreign Currency and International Payments?
The decree imposes comprehensive regulations on foreign currency and international payments. A variety of Vietnamese laws apply to these payments, including foreign exchange management, data protection, cybersecurity, tax administration, anti-money laundering, and counter-terrorist financing. As a result of international treaties and agreements, the State Bank of Vietnam (SBV) oversees these transactions.
What is the effect of Decree 52 on e-wallets and prepaid cards?
E-wallets and prepaid cards, now officially recognized as forms of e-money storage, must comply with SBV regulations mandated by Decree 52.
What will be the transition period's management?
Decree 52 provides several transition periods for stakeholders to align with the new regulations. Those participating in international payment systems, such as commercial banks and foreign bank branches, must comply with the decree's requirements within 24 months. IPS providers connected to international payment systems must comply within the same timeframe and obtain new licenses.
Decree 52: What Are the Broader Implications?
Decree 52 marks a significant milestone in Vietnam's journey towards a cashless economy. By providing a clear regulatory framework for e-money and cashless payments, the decree will enhance financial inclusion, fraud reduction, and the use of digital payment methods.
If you have VND Vietnam Bank notes, you will need to find out how you can comply with Deceree 52 as a foreigner. The channel will also research the topic and report back as soon as we understand the procedure.
