The Code for One-Way Remittances Outward: A Win-Win for All

By providing common practices, with a unified framework for implementation, and compliance with legal regulations, Dr. Nguyen Quoc Hung, Executive Vice President cum General Secretary of VNBA, expects that this Code will bring benefits to customers, banks and management agencies.

Reporter: International remittance transactions are a complex activity, both related to international standards and depending on the specific characteristics of each specific case. How do you evaluate international remittance transactions at banks today?

Dr. Nguyen Quoc Hung: In the context of globalization, the need to transfer money abroad is becoming more and more popular. Pursuant to the provisions of the Foreign Exchange Ordinance, Decree No. 70/2014/ND-CP, Circular 20/2022/TT-NHNN, credit institutions have closely monitored payment activities and money transfers abroad, limiting cases of taking advantage of money transfers exceeding the prescribed limit at banks by regulating money transfer transactions carried out within the credit institution and controlling money transfer transactions carried out at different banks.

However, although the legal framework is relatively clear and complete, in actual implementation, the control and management of payment activities and money transfers abroad through the banking system still face many challenges and reveal some shortcomings.

In reality, the internal regulations on documents and money transfer certificates of each bank are different, leading to inconsistent implementation at times and in some places. Or the same set of money transfer documents, one bank accepts but another bank does not accept due to different internal regulations among banks...

Reporter: In order to build a common and unified convention for member organizations on this issue, VNBA has issued a set of unified rules and practices on the list and principles of providing documents for one-way money transfers abroad by residents who are Vietnamese citizens. Could you please share about the process of building this set of rules?

Dr. Nguyen Quoc Hung: Based on practical shortcomings in one-way remittance abroad for residents who are Vietnamese citizens, on October 24, 2023, VNBA issued Official Letter No. 432/HHNH-PLNV to report to the Governor of the State Bank of Vietnam (SBV) and proposed to develop a unified Code of Conduct and Practice for remittance abroad. On November 10, 2023, the State Bank of Vietnam issued Official Letter No. 8743/NHNN-QLNH agreeing on the policy and assigning VNBA to coordinate with member banks, the Banking Working Group (BWG) and relevant units in the State Bank of Vietnam to develop and promulgate the Code. On that basis, VNBA issued Decision No. 87/QD-CQTT dated December 4, 2023 to establish a Drafting Committee and a Working Group to assist in developing the Code, with the participation of leaders of 7 major banks with experience in international payments (Vietcombank, VietinBank, BIDV, Agribank, MB, Techcombank, VPBank) and the Banking Working Group (BWG). The General Secretary of VNBA is the Head of the Drafting Committee.

During the process of developing the Code, the Drafting Committee coordinated with the Foreign Exchange Management Department (State Bank) to organize many meetings to collect opinions in many rounds from the detailed outline to the draft Code. After completion, VNBA asked for opinions from the Ministry of Public Security, the Ministry of Justice, the Supreme People's Procuracy, the Supreme People's Court and a number of relevant units of the State Bank of Vietnam on the draft Code.

Based on the comments, opinions collected, the Association made appropriate amendments. After 5 rounds of drafting, editing and supplementing with hundreds of comments from member organizations, international organizations, the State Bank of Vietnam and relevant agencies, on February 7, 2025, VNBA officially issued this Code. It can be said that the process of developing the Code was carried out very elaborately, methodically, strictly, scientifically and based on practical needs.

Reporter: What is the significance of the promulgation of this Code for banks, customers, as well as management agencies?

Dr. Nguyen Quoc Hung: The Code guides the list and principles of providing documents for transactions of purchasing, transferring, and carrying foreign currency abroad by residents who are Vietnamese citizens for the following one-way remittance purposes abroad: (1) Studying, receiving medical treatment abroad; (2) Going on business trips, traveling, visiting abroad; (3) Paying fees and charges to foreign countries; (4) Providing allowances for relatives living abroad; (5) Transferring inheritance money to beneficiaries living abroad; (6) Transferring money in case of settling abroad.

The issuance of the Code will help banks implement uniformly with customers nationwide, thereby minimizing related risks. At the same time, it will help state management agencies and functional agencies to more effectively control money transfer activities abroad, limit illegal money transfers, contribute to stabilizing the foreign exchange market, stabilizing exchange rates to attract investors.

For the people, the Code facilitates people when they need to make one-way money transfers abroad. Instead of having to go to a bank with appropriate regulations to make money transfers as before, now they only need to go to the nearest bank to make one-way money transfers abroad, and customers will have their money transfer needs met.

The Code is designed to become a framework regulation for one-way money transfers abroad by residents who are Vietnamese citizens. This is not a legal document, but it will be the basis for banks to implement it as a market practice. The Code emphasizes the responsibility of complying with legal regulations and preventing money laundering of commercial banks and bank officials in the process of providing international money transfer services to customers.

In the world as well as in Vietnam, there have been unified principles and practices, although they are not legal documents, they have been widely applied.

Reporter: What are the notable highlights in this Code, sir?

Dr. Nguyen Quoc Hung: The focus of issuing the Code is to ensure that banks agree on how to guide and implement one-way money transfers abroad on the basis of compliance with legal regulations, in order to serve the necessary needs of residents who are Vietnamese citizens; at the same time, improve the effectiveness of implementing regulations on anti-money laundering.

In addition, the Code has strict regulations, contributing to limiting loopholes that individuals can exploit to carry out money laundering and illegal money transfers abroad by methods such as using a set of documents and money transfer documents multiple times at the same banking system or making multiple money transfers at different banks...

In the context of the risk of foreign currency bleeding and our agreement to strictly implement the Law on Anti-Money Laundering, the Code contributes to creating a fair, healthy and safe playing field in accordance with the provisions of law.

I would like to emphasize again that the Code is not a legal document, but is issued within the scope of member organizations, aiming to unify the implementation, fully comply with the provisions of the law, in order to create convenience and support for people to transfer money as quickly as possible while still ensuring safety in business operations.

Non-member banks and foreign banks, if they see that the Code supports their banks in one-way money transfers abroad and wish to unify the implementation, can register with the VNBA to participate and comply with the contents of the Code.

Reporter: Thank you very much!

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