Circular No. 007/SP/2024 Relating to Payment Institutions for International Fund Transfers

BANQUE DE LA REPUBLIQUE DU BURUNDI

THE GOVERNOR

CIRCULAR N° 007/SP/2024 RELATING TO THE ACTIVITIES OF PAYMENT INSTITUTIONS FOR INTERNATIONAL FUND TRANSFER, ENACTED PURSUANT TO REGULATION N° 002/2024 REVISING REGULATION N° 001/2017 RELATING TO PAYMENT SERVICES AND THE ACTIVITIES OF PAYMENT INSTITUTIONS

Having regard to Law No. 1/34 of December 2, 2008, establishing the Statutes of the Banque de la République du Burundi; Having regard to Law No. 1/17 of August 22, 2017, governing banking activities; Having regard to Law No. 1/07 of May 11, 2018, establishing the national payment system; Having regard to Regulation No. 002/2024 revising Regulation No. 001/2017 relating to payment services and the activities of payment institutions.

The Banque de la République du Burundi, hereinafter referred to as the "Central Bank," enacts this circular.

Article 1: Object and Scope

This circular clarifies certain provisions of Regulation No. 002/2024 revising Regulation No. 001/2017 relating to payment services and the activities of payment institutions, specifically regarding the conditions required for the exercise of activities by payment institutions for international fund transfer.

It applies to payment institutions for international fund transfer authorized by the Central Bank.

Article 2: Definitions

For the purposes of this circular, the following terms are defined as:

1. Counter: a service point or office of a payment institution for international fund transfer other than the registered office;
2. Fund Transfer: an operation by which a payment institution for international fund transfer receives, without the power to dispose of them for its own benefit, funds from the ordering party, with the obligation to transmit them to a designated third-party beneficiary;
3. Payment Institution for International Fund Transfer: a legal entity authorized by the Central Bank to provide international money transfer services;
4. Central Bank: Banque de la République du Burundi;
5. Ordering Party: a natural person who instructs the payment institution for international fund transfer to transfer funds to a designated beneficiary;
6. Beneficiary: a natural person who is the intended recipient of the fund transfer;
7. Intermediary Payment Institution: a payment institution that is neither the ordering party nor the beneficiary and that receives and transmits a fund transfer on behalf of the ordering party's payment institution, the beneficiary's payment institution, or another intermediary payment institution;
8. Unique Transaction Identifier: a combination of letters, numbers, or symbols defined by the ordering party's institution to ensure traceability of the transaction from the ordering party to the beneficiary;
9. Regulated Institution: any institution authorized by the Central Bank to conduct one or more banking activities, such as credit institutions, payment institutions, microfinance institutions, and the National Post Office regarding its banking and/or microfinance activities subject to the authorization and control of the Central Bank.

Article 3: Obtaining Authorization

Any legal entity wishing to conduct the activity of international fund transfer must be authorized by the Central Bank as a payment institution for international fund transfer, under penalty of sanctions.

Obtaining authorization as a payment institution for international fund transfer is subject to the submission of a written application addressed to the Governor of the Central Bank, accompanied by the information and documents listed in Annex 1 of this Circular.

Article 4: Minimum Share Capital

The minimum share capital of a payment institution for international fund transfer is three hundred million (300,000,000 BIF) Burundi Francs.

This capital must be fully subscribed and paid in cash, in an account held at a credit institution, a 1st or 3rd category microfinance institution, or the National Post Office, prior to the granting of authorization.

The amount of share capital may be revised based on the evolution of sector activities.

Article 5: Conditions for Exercising Activities of Payment Institutions for International Fund Transfer

Any payment institution for international fund transfer is required, prior to exercising payment services, to meet the following conditions, among others:

1. Demonstrate the required minimum share capital, fully paid at the time of the application and deposited into the establishment's bank account during formation;
2. Have an operating account opened at a commercial bank, a 1st or 3rd category microfinance institution, or the National Post Office.

Article 6: Periodic Reports

Any payment institution for international fund transfer is required to submit electronically to the Central Bank a monthly report on its transactions, in terms of value and volume, by currency, by type of operation, and by country of origin or destination; the amounts of commissions received/paid or to be received/paid; the names of ordering party clients and beneficiaries, etc., in accordance with the format in Annex 2 of this Circular, no later than the 15th of the month following the concerned month. This report must also include details of unsettled transfers, indicating the reason.

Any payment institution for international fund transfer must communicate to the Central Bank a detailed quarterly report of recorded complaints and the actions taken. The report must reach the Central Bank within ten days following the concerned quarter.

The payment institution for international fund transfer is further required to transmit to the Central Bank its annual financial statements at least one month before the holding of the General Assembly.

Article 7: Declaration of Suspicious Transactions

Any payment institution for international fund transfer must, within a period not exceeding forty-eight hours (48h) from their detection, submit a report to the National Financial Intelligence Unit, with a copy to the Central Bank, regarding suspicious transactions in accordance with the content of Annex 3 of this Circular.

Article 8: Transaction Amount Limits

The limits for amounts for outgoing international fund transfer operations are as follows:

1. The maximum limit of transactions per person per day: Three thousand US dollars (USD 3,000);
2. The maximum limit of transactions per person per month: Ten thousand US dollars (USD 10,000).

If the transaction must be carried out in a currency unit other than the US dollar "USD", the payment institution for international fund transfer must ensure that the amount of the operation does not exceed the USD equivalent of the amount following the exchange rate of the day of the operation, fixed by the Central Bank.

There are no maximum amount limits for incoming flows.

For both outgoing and incoming operations, the identification of the ordering party, the beneficiary, and the purpose of the transaction must be clearly established.

Article 9: Information to Clients

Any operation carried out by a payment institution for international fund transfer must result in the production, for the attention of the ordering party, of a receipt comprising in particular:

1. Elements allowing the identification of the ordering party (names, ID card or passport number, phone number, physical address);
2. The amount and currency of the transfer;
3. The amount of commissions received or paid;
4. The identity of the beneficiary;
5. The purpose of the operation.

Article 10: Information System Requirements

Any payment institution for international fund transfer must equip itself with an information system adapted to its size, activity volume, and risk profile, enabling it notably to:

1. Identify persons who initiated or benefited from fund transfers;
2. Ensure that these persons or those related or associated with them are not listed on blacklists of international organizations or suspected of money laundering and terrorist financing;
3. Monitor operations performed to, if necessary, detect those of a suspicious or unusual nature.

Article 11: Obligation to Retain Receipts

Any international fund transfer operation must be carried out based on a dated, numbered slip prepared in duplicate. The original is handed to the ordering party client or beneficiary, and the copy is retained by the payment institution for international fund transfer.

This slip, as well as information on the identity of the client and the effective beneficiary, is retained for a period of two years.

Article 12: Combating Money Laundering and Terrorist Financing

Any payment institution for international fund transfer is required to equip itself with accounting, written rules, and internal control procedures specific to ensuring compliance with legal and regulatory provisions in force regarding the fight against money laundering and terrorist financing.

To this end, the payment institution for international fund transfer has the obligation to:

1. Ensure the identity and address of the ordering party client and, if applicable, the effective beneficiary, at the time of executing a transaction by presenting a valid identity document;
2. Collect and photocopy the identities of ordering party clients and/or transfer beneficiaries at their counters and retain them according to legal deadlines;
3. Permanently monitor the ordering party client's operations, with regard to the object of the transfer, the client's profile, and, if applicable, the origin of their funds;
4. Ensure continuous training and regular communication of information to its employees to sensitize them to appropriate criteria allowing them to determine operations requiring particular attention and the diligence to be carried out regarding them.

Article 13: Interface Sharing Obligation

For reasons of close supervision, any payment institution for international fund transfer is required to share a real-time monitoring interface of its activities with the Central Bank.

Article 14: Unauthorized Activities

Any payment institution for international fund transfer is not authorized to carry out activities other than those for which it has been authorized.

It is not authorized in particular to:

1. Accept deposits for its clients' accounts;
2. Issue or manage payment instruments;
3. Issue electronic money;
4. Carry out fund transfers at the national level;
5. Import or export banknotes;
6. Receive transfers and transfers from its clients on its bank accounts other than the operating account;
7. Grant loans to its clients;
8. Market its fund transfer platform to any regulated institution;
9. Carry out manual currency exchange.

Article 15: Sanctions

Any failure to comply with the provisions of this Circular exposes the payment institution for international fund transfer to sanctions provided for by Circular No. 006/SP/2024 relating to the matrix of sanctions applicable to payment institutions or any other payment service provider and those detailed in the table in Annex 4 of this Circular.

Article 16: Transitional Provisions

Any international fund transfer institution authorized prior to the entry into force of this circular has a period of six months to comply with the provisions of this Circular from its entry into force.

Article 17: Entry into Force

This Circular enters into force on the day of its publication in the Official Bulletin of Burundi and on the website of the Banque de la République du Burundi.

Done in Bujumbura, on October 16, 2024.

Edouard Normand BIGENDAKO Governor

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ANNEX 1: AUTHORIZATION REQUIREMENTS

A. APPLICATION FORM FOR AUTHORIZATION OF A PAYMENT INSTITUTION FOR INTERNATIONAL FUND TRANSFER

1.	APPLICANT NAME (as it appears on the registration register)
2.	CATEGORY OF LICENSE REQUESTED
3.	APPLICANT CONTACTS
	Physical Address: Plot No.
	Building Name
	Floor Level
	Avenue
	City
	P.O. Box
	Landline
	Fax
	Mobile Phone
	Email Address

B. IDENTITY OF SHAREHOLDERS

No.	NAME	ADDRESS	NATIONALITY	OCCUPATION	NUMBER OF SHARES HELD IN SHAREHOLDING	PHONE & EMAIL
1.
2.
3.

C. IDENTITY OF ADMINISTRATORS AND EXECUTIVES

No.	NAME	NATIONALITY	POSITION HELD	EDUCATION LEVEL	PHONE & EMAIL
1.
2.
3.

D. OTHER INFORMATION:

1.	Indicate if any of the partners/executives/shareholders hold shares in another company authorized by the Central Bank
2.	Is there a previous application that was rejected or cancelled by the Central Bank? (If yes, provide details)
3.	Others (to be specified).

E. SHAREHOLDERS' DECLARATION:

We, the undersigned, hereby declare: a) that the information mentioned in this document is true and conforms to reality; b) that we are not declared bankrupt and have never been found guilty of fraud or dishonesty in Burundi and/or elsewhere.

No.	Name and Surname	Signature
1.
2.
3.

F. INFORMATION AND DOCUMENTS TO BE PROVIDED WITH THE AUTHORIZATION APPLICATION

1. Legal Documents and Information a. a request letter signed by the legal representative of the establishment in creation or the institution duly authorized for this purpose, addressed to the Central Bank; b. a information sheet on the main shareholders, executives, and partners of the institution (certified true copies of identity documents, dated and signed curricula vitae, criminal record extracts or any other equivalent document less than three months old); c. a receipt of registration with the Commercial Register and the Burundi Development Agency (ADB); d. proof of payment of the entire capital; e. the articles of association drafted in reference to the Burundi Companies Code; f. draft contracts to be concluded with clients.

2. Financial Documents and Information a. a detailed presentation of the activity that the establishment or institution wishes to conduct; b. financial projections established for at least three years, for the activity for which authorization or approval is sought, with sensitivity assumptions.

3. Technical Architecture a. a copy of contracts and protocols concluded with technical partners in the framework of the establishment's activity; b. a presentation of the architecture of information and technical systems and their functioning allowing verification of compliance with all technical security standards; c. platform certification attestations, if applicable; d. information system security policy and associated procedures; e. the business continuity device.

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ANNEX 2: MONTHLY REPORT OF ACTIVITIES OF PAYMENT INSTITUTIONS FOR INTERNATIONAL FUND TRANSFER

NAME OF ESTABLISHMENT: ........................................... ADDRESS OF ESTABLISHMENT: ........................................... REPORT TRANSMISSION ADDRESS: RapportsSFN@brb.bi

OUTGOING TRANSACTIONS

No.	Operation Date	Operation Reference	Sender's First and Last Name	Valid ID or Passport No.	Phone Number	Nationality	Amount Transferred	Currency Used	Rate Used	Purpose of Transfer	Destination Country and City	Beneficiary Name	Operation Status	Reason for Non-Settlement	Fees Paid by Sender

INCOMING TRANSACTIONS

No.	Operation Date	Operation Reference	Beneficiary's First and Last Name	Valid ID or Passport No.	Phone Number	Nationality	Amount Received	Currency Used	Rate Used	Purpose of Transfer	Country and City of Origin	Sender Name	Operation Status	Reason for Non-Settlement	Fees Received

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ANNEX 3: SUSPICIOUS TRANSACTIONS IDENTIFIED IN THE SYSTEM

Incoming Suspicious Transactions

No.	Description	Country of Origin	Beneficiary	Volume	Value

Outgoing Suspicious Transactions

No.	Description	Destination Country	Ordering Party	Volume	Value

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ANNEX 4: SPECIFIC SANCTIONS FOR PAYMENT INSTITUTIONS FOR INTERNATIONAL FUND TRANSFER IN COMPLEMENT TO CIRCULAR N° 006/SP/2024 RELATING TO THE MATRIX OF SANCTIONS APPLICABLE TO PAYMENT INSTITUTIONS OR ANY OTHER PAYMENT SERVICE PROVIDER

Without prejudice to the common sanctions enumerated in Circular No. 006/SP/2024 relating to the matrix of sanctions applicable to payment institutions or any other payment service provider, the following sanctions are applicable to payment institutions for international fund transfer.

No.	Breaches	References to Regulatory Provisions	Sanctions
1	Delay in transmitting the monthly report	Article 6, paragraphs 1 and 2: Any payment institution for international fund transfer is required to submit electronically a monthly report on its transactions, in terms of value and volume, by currency, by type of operation and by country of origin or destination; the amounts of commissions received/paid or to be received/paid; the names of ordering party clients and beneficiaries ... no later than the 15th of the month following the concerned month.	Pecuniary sanction per day of delay: - 100,000 BIF per day of delay during the first ten days; - 500,000 BIF per day of delay during the following twenty days; - 1,000,000 BIF per day of delay exceeding one month.
2	Delay in transmitting the detailed quarterly report of recorded complaints and the actions taken.	Article 6, paragraph 2: Any payment institution for international fund transfer must communicate to the Central Bank the details of recorded complaints and the actions taken, within a period of ten days following the concerned quarter.	Pecuniary sanction per day of delay: - 100,000 BIF per day of delay during the first ten days; - 500,000 BIF per day of delay during the following twenty days; - 1,000,000 BIF per day of delay exceeding one month.
3	Delay in transmitting annual financial statements	Article 6 paragraph 3: The payment institution for international fund transfer is further required to transmit to the Central Bank its annual financial statements at least one month before the holding of the General Assembly.	Pecuniary sanction per day of delay: - 100,000 BIF per day of delay during the first ten days - 500,000 BIF per day of delay during the following twenty days - 1,000,000 BIF per day of delay exceeding one month and/or Disciplinary sanction on the Executive
4	Delay in transmitting to the National Financial Intelligence Unit, with copy to the Central Bank, the report regarding suspicious transactions	Article 7: Any payment institution for international fund transfer must, within a period of forty-eight hours, submit a report to the National Financial Intelligence Unit, with a copy to the Central Bank, regarding suspicious transactions.	- Pecuniary sanction 500,000 BIF per day of delay during the first twenty days - Suspension of the establishment until compliance with this requirement and/or Disciplinary sanction on the Executive
5	Non-compliance with maximum transaction limits	Article 8, paragraph 1: The limits for amounts for outgoing international fund transfer operations per person per day is three thousand US dollars (USD 3,000) and ten thousand US dollars (USD 10,000) per person per month.	- Pecuniary sanction of 100% of the amount exceeding the transaction limit and/or - Disciplinary sanction on the Executive and/or - Withdrawal of authorization of the Executive and/or the establishment
6	Non-compliance with identification of the ordering party and the purpose of the transaction	Article 8, paragraph 3: For both outgoing and incoming operations, the identification of the ordering party, the beneficiary, and the purpose of the transaction must be clearly established.	- Pecuniary sanction of 500,000 BIF per transaction And/or - Disciplinary sanction on the Executive
7	Non-compliance with the obligation to produce a receipt for the attention of the ordering party for any operation carried out	Article 9: Any operation carried out by an international fund transfer establishment must result in the production, for the attention of the ordering party, of a receipt comprising in particular the elements allowing the identification of the ordering party (names, ID card number, phone number, physical address); the amount and currency of the transfer; the amount of commissions received or paid; the identity of the beneficiary and the purpose of the operation.	- Pecuniary sanction of 1,000,000 BIF per operation and/or - Disciplinary sanction on the Executive
8	Absence of an information system adapted to the size, activity volume, and risk profile	Article 10: Any international fund transfer establishment must equip itself with an information system adapted to its size, activity volume, and risk profile, enabling it notably to identify persons who initiated or benefited from fund transfers; to ensure that these persons or those related or associated with them are not listed on blacklists of international organizations or suspected of money laundering and terrorist financing and to monitor operations performed to, if necessary, detect those of a suspicious or unusual nature.	[Text cuts off in source]