3:26:20 PM | 7/8/2005
Cash Payment and Solution
In
With the development of electronic and information technology, non-cash payment methods are well suited to the market economy, especially in developed countries, facilitating business practices and helping to eliminate large cash transactions. During
Although there is no opposition to cash payment in economic activities in concept, in reality, the cash economy is an issue which must be addressed as part of the fight against corruption and money laundering. The current large volume of cash payments in business poses a risk of exposure to corruption, which is compelling the government to take new approaches to cash management. The rationale behind cash management by other countries is to mobilise all available resources and prevent social problems.
At the seminar, participants acknowledged the relevance of the decree and proposed some amendments to the draft. They believed that the decree should apply not only to organisations with bank accounts but also other business organisations. They also expressed reservations regarding the level of cash payment, fixed cash reserves and the role of State control and supervision in payment activities. They also requested that the government develop payment services so that individuals and businesses may access non-cash payment facilities, encouraging people's confidence in opening accounts and moving to a non-cash payment economy model.
Forum:
Broader compliance of the Decree
Mr. Trinh Ba Tuu, head of training, Vietnam Banking Association
The draft denotes only "organisations" and "having accounts". Does it target only organisations holding accounts, and not individuals having accounts? Sole traders also handle huge volumes of cash. They need to be covered by the decree as well
The draft provides two levels of cash payment: VND 5 and 10 million. It is almost irrelevant. Sometimes, cash payments of up to one billion VN Dong are necessary, with the condition that it is duly reported to the State Bank of the Treasury.
No fee on cash payment
Dr. Nguyen Ngoc Thach, Director, Thach and Associates Law Firm
I think that the provision concerning fees on cash payments must be deleted. As we are encouraging people to open bank accounts for non-cash payment, the fee on deposits and withdrawals of money should not be applied at this juncture. Most commercial banks do not apply it, and we should not set a bad precedent. Moreover, in many cases, payments must be in cash. Placing a fee on cash payments would be unfair in these circumstances.
The level of fixed money reserves should not be decided by the government but by the organisations themselves, as is the practice in developed countries. It is most important for the government to focus on controlling the payments between organisations with accounts at banks and do it now.
Payment organisations share responsibility
Ms. Nguyen Thi Thuong Huyen, Deputy Head, Taxation and Customs Faculty,
Under the provisions of the draft decree, the State Bank is the sole controller of all organisations having accounts. This is practically impossible for one body to monitor, as organisations often have accounts in several banks. I think that the Taxation Department, Treasury, and State Bank are all competent State authorities to share the responsibility of control and supervision of cash management.
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