Law on Cash Payment Submitted for Govt Consideration

The State Bank of Vietnam (SBV), the country’s central bank, has recently submitted for government approval the draft law on cash payment in order to help raise non-cash settlement ratios among businesses nation-wide, which now stood at the very high level of nearly 80 per cent.

According to the draft law, all cash transactions of over VND10 million (US$636) will be prohibited. The latest draft decree on cash settlement management stipulates that payments from the State budget cannot be made for amounts over VND5 million (US$318) in cash, while those for other sources will have a threshold of VND10 million.

Ngo Hong Nam, Head of the Payment System Section of SBV, told the Tien Phong newspaper that the stipulation should limit cash payments, which are prone to corruption and misspending, thereby making transactions more transparent.

“Non-cash payment helps local enterprises and individuals to reduce business costs and helps boost the speed of capital circulation in the economy and help boost transparency in economic relations,” he said.

However, Mr. Nam recognised that the e-payment systems of local banking systems remained under-developed. By the end of last year, local commercial banks installed nearly 700 automated teller machines (ATMs).

Currently there are around one million accounts in the country’s banking system with total funds of VND10 trillion (US$637 million).

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