Instruction on Conducting Inspectorial Inspections of Payment System Operators and Payment Organizations

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Creation date: 2025-12-26

Appendix to the Resolution of the Board of the National Bank of the Kyrgyz Republic of September 14, 2022 No. 2022-P-14/57-1-(PS)

INSTRUCTION

on conducting inspectorial inspections of the activities of payment system operators and payment organizations

(As amended by the Resolutions of the Board of the National Bank of the Kyrgyz Republic of August 23, 2023 No. 2023-P-14/53-5, December 19, 2025 No. 2025-P-14/68-3-(NPA))

Chapter 1. General Provisions

1. This Instruction "On Conducting Inspectorial Inspections of the Activities of Payment System Operators and Payment Organizations" (hereinafter - the Instruction) establishes the objectives, types, and procedures for conducting inspectorial inspections of the activities of payment system operators and payment organizations (hereinafter - supervised organizations) that have a license/licenses from the National Bank of the Kyrgyz Republic (hereinafter - the National Bank) to carry out the following types of activities:

• provision of services for accepting and conducting payments and settlements for goods and services, not resulting from their own activities, on behalf of third parties through payment systems based on information technologies and electronic means and methods of conducting payments;

• provision of services for accepting, processing, and issuing financial information (processing, clearing) on payments and settlements of third parties to participants of the payment system, this processing, clearing center.

2. Conducting inspectorial inspections, as well as applying impact measures in case of violation by the supervised organization of the requirements of the legislation of the Kyrgyz Republic, is part of the National Bank's activity in supervising compliance by supervised organizations with established requirements.

3. The National Bank exercises supervision over the compliance of supervised organizations with the requirements of the legislation of the Kyrgyz Republic to ensure the safety, efficiency, and continuity of the functioning of the payment system of the Kyrgyz Republic.

4. For the purposes of this Instruction, the following abbreviated designations and definitions are used:

• inspection group - a group of persons formed from employees of the National Bank, indicated in the inspection directive, whose powers include performing tasks and functions for conducting an inspectorial inspection of the activity of the supervised organization, defined in this Instruction;

• authorized structural subdivision - a structural subdivision of the National Bank carrying out functions of regulation, supervision, and control over payment systems, payment system operators, and payment organizations;

• officials - members of the supervisory, executive management bodies of the supervised organization and/or persons equated to them in their functional duties, carrying out general and current management of the activity of the supervised organization;

• supervisory management body - a management body of the supervised organization carrying out general management of its activity and accountable to the highest management body of the supervised organization in accordance with the legislation of the Kyrgyz Republic and the constituent documents of the organization;

• executive management body - a management body of the supervised organization carrying out current management of its activity and accountable to the supervisory (if any) or highest management body of the supervised organization in accordance with the legislation of the Kyrgyz Republic and the constituent documents of the organization.

5. During inspectorial inspections, the National Bank/inspection group has the right to request and receive any information concerning the activities of supervised organizations, their reporting, agents, sub-agents, suppliers of goods/services, and other counterparties within contractual relations with the supervised organization, as well as subsidiary organizations, and to require explanations regarding the received information and, if necessary, to receive copies of supporting documents certified by the signature of the head/other authorized person and the seal of the supervised organization. For subsidiary organizations, the supervised organization provides the following documents and information:

• constituent documents;

• financial reporting;

• information about the head.

The requested information must be provided in accordance with the deadlines specified in the request of the National Bank/inspection group.

Chapter 2. Objectives of Conducting Inspectorial Inspections

6. The main objectives of conducting inspectorial inspections of the activities of supervised organizations are:

• assessment of the overall financial condition of the supervised organization, the quality of management processes;

• determination of risks of the supervised organization that may threaten the continuity and efficiency of the payment system;

• establishment of compliance and observance by the supervised organization of the legislation of the Kyrgyz Republic;

• assessment of the accuracy and reliability of the financial and other reporting/information of the supervised organization submitted to the National Bank;

• development of recommendations for eliminating identified violations and deficiencies, improving the state of the activity of the supervised organization and reducing its risks, and, if necessary, development of preventive/corrective measures and/or impact measures;

• assessment of the performance by the supervised organization of recommendations and directives issued following the previous inspectorial inspection and/or during the implementation of external supervision.

Chapter 3. Types of Inspectorial Inspections

7. Inspectorial inspections, depending on the tasks set, may be comprehensive and targeted.

8. The plan for inspectorial inspections of supervised organizations is compiled for each year and approved by the Deputy Chairman/Member of the Board of the National Bank supervising the authorized structural subdivision, or by the person replacing him.

Planning of inspectorial inspections is carried out taking into account the following main criteria (but is not limited to them):

• the degree of significance of the payment system, which is determined by the Supervision Committee of the National Bank in accordance with the Policy on Supervision (oversight) of the payment system of the Kyrgyz Republic, approved by the Resolution of the Board of the National Bank of July 15, 2015 No. 38/4;

• the size of the authorized capital;

• the acceptance of budget payments;

• previous inspectorial inspections conducted;

• execution of directives and other impact measures, and so on.

Changes may be made to the plan for inspectorial inspections if necessary.

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of December 19, 2025 No. 2025-P-14/68-3-(NPA))

9. A comprehensive inspection determines the overall financial condition, the quality of management of the supervised organization, the compliance of the supervised organization with the legislation of the Kyrgyz Republic regulating its activity, and also determines the risks, deficiencies, and weaknesses of the supervised organization that may threaten its sustainability and stability.

10. A targeted inspection provides for the inspection of one or several types of activities of the supervised organization.

11. Depending on the order of notification, inspections may be planned (with prior notification to the supervised organization) and sudden (without prior notification about the upcoming inspection).

12. Targeted inspections may have a sudden (unplanned) nature. In the event of conducting a sudden inspection, the inspection directive is presented to the supervised organization directly at the moment of arrival of the inspection group.

13. An inspectorial inspection of a supervised organization is conducted on the basis of a directive for conducting an inspectorial inspection (hereinafter - inspection directive). The inspection directive may be signed by:

• the Chairman of the National Bank or the person replacing him;

• the Deputy Chairman/Member of the Board of the National Bank supervising the authorized structural subdivision, or the person replacing him;

• the head of the regional department/head of the representation of the National Bank in the Batken region at the location of the supervised organizations or the person replacing him.

14. Conducting sudden targeted inspectorial inspections may be carried out on the basis of a decision by one of the persons specified in paragraph 13 of this Instruction, if:

• a violation of the continuity of the functioning of the payment system is detected;

• there are facts of fraud, abuses, and other illegal activities carried out by the supervised organization, including based on information provided by citizens, organizations;

• based on the provided reporting, negative trends have been identified that may lead to a deterioration of the financial condition of the supervised organization, or there are doubts about the completeness and reliability of the reporting/information provided to the National Bank;

• circumstances contradicting the legislation of the Kyrgyz Republic exist in the activity of the supervised organization;

• requirements and/or decisions of the National Bank are not executed;

• there is a directive/other requirement within the framework of applying impact measures of the National Bank, for the purpose of verifying its execution by the supervised organization;

• there is information/information/appeals from citizens/organizations about disagreements (conflicts) between founders/participants/shareholders, officials of the supervised organization (related to the supervised organization), which may lead to a violation of the uninterrupted functioning of the payment system, and/or which may lead to non-performance of obligations to users;

• there is information/information/events that may lead to a violation of the uninterrupted functioning of the payment system, and/or which may lead to non-performance of obligations to users;

• there is information from law enforcement agencies about illegal activity of the supervised organization.

Chapter 4. Procedure for Conducting Inspectorial Inspections

15. The National Bank conducts planned (comprehensive/targeted) inspectorial inspections of supervised organizations no more than once every two years in accordance with the approved plan for inspectorial inspections of supervised organizations, according to paragraph 8 of this Instruction.

16. For the conduct of a planned or sudden inspectorial inspection, an inspection group is formed consisting of no fewer than two people, which may include representatives of structural subdivisions of the National Bank and/or the regional department/representation of the National Bank in the Batken region, its head and member(s) of the inspection group are appointed (hereinafter - authorized representatives of the National Bank). The document confirming the powers of the authorized representatives of the National Bank to conduct an inspectorial inspection of the supervised organization is the inspection directive signed by the person specified in paragraph 13 of this Instruction.

17. The total duration of an inspectorial inspection does not exceed 20 (twenty) working days.

If necessary, arising during the conduct of an inspectorial inspection, the inspection period may be extended to 30 (thirty) working days in the manner provided for in paragraph 26 of this Instruction.

18. The inspection directive is оформлен (drawn up) by the National Bank according to the form of Appendix 1 to this Instruction and contains the following information:

• about the start date of the inspection;

• about the duration of the inspection (in working days);

• about the issues subject to inspection (except in the case of conducting comprehensive inspections);

• about the inspection period;

• about the personal composition of the inspection group.

19. During the inspection, the inspection group may request documents/information from the supervised organization formed outside the limits of the inspection period specified in the inspection directive, if, during the practical study of the issues specified in the directive, the need arises to cover an earlier or later period of the organization's activity for a full study of the issues.

20. In the event that the inspectorial inspection is planned, the head of the inspection sends a notification letter to the supervised organization with an attached list of documents/information/accesses to systems required to be provided on the subject of the inspection (according to the form of Appendix 2 to this Instruction) no later than 10 (ten) working days before the start of the inspection, and the inspection directive is presented upon arrival.

The list of documents/information/accesses to systems specified in Appendix 2 to this Instruction may change/be supplemented in each specific case depending on the tasks, objectives, deadlines of the upcoming inspection, and the specifics of the activity of the supervised organization.

21. The start date of the inspection is considered to be the date specified in the inspection directive, or the date of delivery of the inspection directive by the inspection group of the National Bank to the head/other authorized person of the supervised organization.

22. The original of the inspection directive is transferred to the head/other authorized person of the supervised organization; a copy of the inspection directive with a mark of the date and time of delivery, certified by the signature of the head/other authorized person and the seal of the supervised organization, is transferred by the supervised organization to the authorized representatives of the National Bank.

23. Upon arrival at the inspection site, the head of the inspection group conducts a meeting with the head of the supervised organization (or the person performing his duties) in order to:

• deliver the inspection directive, and also inform about the scale and tasks of the inspection;

• discuss the upcoming process of conducting the inspection;

• introduce the members of the inspection group with an indication of the areas of his/their work;

• determine the methods of conducting contacts with the management and employees of the supervised organization;

• answer questions from representatives of the supervised organization on the subject of the inspection.

24. On the first day of the inspection, the supervised organization is obliged to provide all documents/information/accesses to systems specified in the notification letter sent in accordance with paragraph 20 of this Instruction. The absence of the specified documents/information/accesses to systems is documented by an act confirming the established facts and/or