Resolution of the Board of the National Bank of the Kyrgyz Republic No. 35/19 of 25 September 2013 on Amending and Supplementing Certain Regulatory Legal Acts of the National Bank of the Kyrgyz Republic

NATIONAL BANK OF THE KYRGYZ REPUBLIC

RESOLUTION

of 25 September 2013 No. 35/19

On Amending and Supplementing Certain Regulatory Legal Acts of the National Bank of the Kyrgyz Republic

(As amended by the Resolution of the Board of the National Bank of the Kyrgyz Republic of 12 May 2015 No. 27/8)

In accordance with Articles 7 and 43 of the Law of the Kyrgyz Republic "On the National Bank of the Kyrgyz Republic", the Board of the National Bank of the Kyrgyz Republic

RESOLVES:

1. To approve the attached amendments and supplements to certain regulatory legal acts of the National Bank of the Kyrgyz Republic (attached).

2. To the Legal Department:

• to publish this resolution on the official website of the National Bank of the Kyrgyz Republic;

• after official publication, to send this resolution to the Ministry of Justice of the Kyrgyz Republic for inclusion in the State Register of Regulatory Legal Acts of the Kyrgyz Republic.

3. This resolution shall enter into force after 15 days following its official publication.

4. To the Payment Systems Department: to bring this resolution to the attention of commercial banks of the Kyrgyz Republic and CJSC "Interbank Processing Center".

5. To assign control over the execution of this resolution to the Deputy Chairman of the National Bank of the Kyrgyz Republic, B.Zh. Zheenbayevа.

Chairman	Z. Asankozhoeva

	Annex to the resolution of the Board of the National Bank of the Kyrgyz Republic of 25 September 2013 No. 35/19

Amendments and Supplements to Certain Regulatory Legal Acts of the National Bank of the Kyrgyz Republic

I. To introduce into the "Regulation on Bank Payment Cards in the Kyrgyz Republic", approved by resolution of the Board of the National Bank of the Kyrgyz Republic No. 41/7 of 14 October 2009, the following amendments and supplements:

1. Paragraph 3.9 of Section 3 shall be supplemented with a fourth sentence as follows:

"When issuing and using prepaid cards, the restrictions established in Annex 4 to this Regulation must be observed".

2. In the second sentence of paragraph 6.1 of Section 6, the words "may be" shall be replaced by the words "must be".

3. In Section 6, paragraph 6.4 shall be supplemented, after the sentence "... in paragraph 1 of Annex 4 to this Regulation", with the following sentence:

"- Banks are obliged to issue prepaid cards strictly for their intended purpose in accordance with this Regulation and in accordance with the restrictions specified in paragraphs 4 and 5 of Annex 4 to this Regulation.".

4. Subparagraph 14 of paragraph 9.1 of Section 9 shall be restated as follows:

"14) the requirement on the rules for ensuring security when performing a transaction in accordance with paragraph 3 of Annex 4 to this Regulation".

5. Annex 4 "Restrictions on Operations with Bank Payment Cards" to the Regulation on Bank Payment Cards in the Kyrgyz Republic shall be restated as follows:

	"Annex 4 to the Regulation on Bank Payment Cards in the Kyrgyz Republic

Restrictions on Operations with Bank Payment Cards(*)

1. The amount (sum) of funds on one prepaid card must not exceed the following limits of amounts in the national currency or its equivalent in foreign currency:

A) 1,500 (one thousand five hundred) calculation indicators, if the card is intended for the disbursement of a loan to a borrower of the card-issuing bank or to a borrower of a microfinance organization within the framework of a special agreement on the servicing by the issuing bank of the credit operations of the microfinance organization through the issuance of prepaid cards. The agreement may provide for the possibility of multiple disbursements of a loan and its repayment by crediting funds to one prepaid card within the limit established by this paragraph. The bank must have procedures for controlling the risks of carrying out operations with prepaid cards, including the collection and assessment of the necessary data for identifying the client, and must establish the period of its use and cash withdrawal limits.

B) 500 (five hundred) calculation indicators, if the card is intended for purposes not falling under subparagraph A of paragraph 1 of this Annex.

2. The acquirer must set a limit on ATMs for the amount of a single transaction. The amount of a single transaction carried out by a cardholder through an ATM must not exceed 250 (two hundred and fifty) calculation indicators in the national currency or its equivalent in foreign currency.

3. Requirement on the rules for ensuring security when performing a transaction: In the terms of the agreement with the merchant (TSP), the bank must include the indicators and list of suspicious operations and establish limits on the amount of a single transaction above which the merchant must request a supporting document from the cardholder (passport or other identity documents in accordance with the legislation of the Kyrgyz Republic). Data on the identity document must be entered on the card receipt. When compiling the list of suspicious operations, the bank must be guided by the legislation regulating issues of consumer rights protection, countering the financing of terrorism and the legalization ("laundering") of illegal income, as well as other regulatory legal acts related to ensuring the security of payments and settlements.

4. Prepaid cards must not be issued for servicing "payroll" projects, i.e. for the payment of wages to staff employees, as well as for the payment of remuneration to persons hired by an employer to perform work and services on a permanent basis or for a period exceeding one month. The issuance of prepaid cards as remuneration for work or services is not permitted under monthly or regularly re-concluded/renewed agreements involving continuous performance of work or provision of services.

5. The issuer is prohibited from exchanging electronic money for cash using prepaid cards, except in cases where the holder of the prepaid card has their own bank account, and the issuance of cash is carried out by preliminary transfer of funds from the cardholder's prepaid card to their bank account".

II. (Repealed in accordance with resolution of the Board of the National Bank of the Kyrgyz Republic of 12 May 2015 No. 27/8)