Resolution of the Board of the National Bank of the Kyrgyz Republic No. 59/6 of 30 September 2015 on Amendments and Additions to the Resolution of the Board of the National Bank of the Kyrgyz Republic of 15 July 2009 No. 30/6 on Approval of the Rules for Making Money Transfers through Money Transfer Systems in the Kyrgyz Republic

NATIONAL BANK OF THE KYRGYZ REPUBLIC

RESOLUTION

of 30 September 2015 No. 59/6

On Amendments and Additions to the Resolution of the Board of the National Bank of the Kyrgyz Republic "On Approval of the 'Rules for Making Money Transfers through Money Transfer Systems in the Kyrgyz Republic'" of 15 July 2009 No. 30/6

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

RESOLVES:

1. To introduce amendments and additions to the Resolution of the Board of the National Bank of the Kyrgyz Republic "On Approval of the 'Rules for Making Money Transfers through Money Transfer Systems in the Kyrgyz Republic'" of 15 July 2009 No. 30/6 (attached).

2. The Legal Department shall:

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

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

3. This resolution enters into force upon the expiry of fifteen days from the day of official publication.

4. The Payment Systems Department shall bring this resolution to the attention of commercial banks of the Kyrgyz Republic.

5. Control over the execution of this resolution shall be assigned to the Deputy Chairman of the National Bank of the Kyrgyz Republic, B.Zh. Zheenbayev.

Chairman	T. Abdygulov

Annex

AMENDMENTS AND ADDITIONS to the Resolution of the Board of the National Bank of the Kyrgyz Republic "On Approval of the 'Rules for Making Money Transfers through Money Transfer Systems in the Kyrgyz Republic'" of 15 July 2009 No. 30/6

To introduce the following amendments and additions to the Resolution of the Board of the National Bank of the Kyrgyz Republic "On Approval of the 'Rules for Making Money Transfers through Money Transfer Systems in the Kyrgyz Republic'" of 15 July 2009 No. 30/6:

In the Rules for Making Money Transfers through Money Transfer Systems in the Kyrgyz Republic approved by the above-mentioned resolution:

• paragraph 1.1 shall be stated in the following wording:

"1.1. These Rules have been developed in accordance with the Laws of the Kyrgyz Republic "On the National Bank of the Kyrgyz Republic", "On Banks and Banking Activity in the Kyrgyz Republic", "On Electronic Documents and Electronic Digital Signature", "On Operations in Foreign Currency", "On Combating the Financing of Terrorism and the Legalization (Laundering) of Proceeds from Crime", "On the Payment System of the Kyrgyz Republic" and other normative legal acts of the Kyrgyz Republic.";

• paragraph 1.2 shall be stated in the following wording:

"1.2. The transfer of funds without opening a bank account (hereinafter - money transfer) on the territory of the Kyrgyz Republic is carried out by natural persons, residents and non-residents of the Kyrgyz Republic in national or foreign currency through commercial banks (hereinafter - banks) licensed and regulated by the National Bank of the Kyrgyz Republic (hereinafter - the National Bank) using specialized money transfer systems (local, international systems) or through direct correspondent relations of banks (international/cross-border money transfers).

The transfer of funds through money transfer systems in Kyrgyz soms (the national currency of the Kyrgyz Republic) within the Kyrgyz Republic must be carried out only using local money transfer systems.";

• paragraph 1.5 shall be stated in the following wording:

"1.5. Banks of the Kyrgyz Republic may become participants of international money transfer systems by signing the corresponding agreement with the operator of the money transfer system, complying with the rules of the system and the legislation of the Kyrgyz Republic. The operator of an international money transfer system is a legal entity, resident or non-resident of the Kyrgyz Republic, acting on the basis of permitting documents for carrying out this type of activity issued by the authorized body for financial supervision of the country of origin and registered with the National Bank.";

• the first sentence of paragraph 1.6 shall be stated in the following wording:

"A bank may conclude an agreement (agency agreement) with non-bank financial and credit institutions and non-bank organizations for the provision of money transfer services to the population through money transfer systems in accordance with the normative legal acts of the Kyrgyz Republic.";

• paragraphs 2.1 and 2.2 shall be recognized as having lost force;

• paragraph 2.3 shall be supplemented after the first paragraph with paragraphs of the following content:

"The recipient of a money transfer on the territory of the Kyrgyz Republic, at his own choice, has the right to receive the money transfer in cash through the cash desk or peripheral devices (ATM/terminal) of the bank, including with the use of an identifier carrier of the money transfer recipient in the money transfer system (if it is provided for by the rules of the money transfer system), or in non-cash form by transferring/crediting funds to the bank account specified by the recipient, to a bank payment card issued by the bank, and/or to an electronic wallet/electronic money.

The identifier carrier of the money transfer recipient may be in the form of a one-time card that is not a bank payment card and is intended only for receiving a money transfer by issuing cash in the amount of the money transfer at the cash desks or peripheral devices (ATM/terminal) of all banks connected to this system. The validity period of this card (identifier carrier) must not exceed 30 days from the moment of sending the money transfer. Responsibility for the transfer of funds by the card (identifier carrier) is borne by the payment system. It is prohibited to carry out any other banking operations using the identifier carrier.

If the rules of the money transfer system provide for receiving a money transfer in parts, the recipient of the money transfer has the right to receive part of the money transfer amount in cash using the identifier carrier, and has the right to send the remaining funds for crediting to the bank account specified by the recipient, to a card issued by the bank, and/or to an electronic wallet.

When receiving a money transfer using the identifier carrier through an ATM, each cash withdrawal operation must not exceed 250 (two hundred fifty) calculation indicators in national currency or its equivalent in foreign currency.

The conditions for using the identifier carrier of the money transfer recipient (identification requirements, limits, etc.) must be established by the rules of the system, reflected in bilateral agreements between the participant and the operator of the money transfer system, and comply with the legislation of the Kyrgyz Republic.

The transfer of funds through money transfer systems is considered final:

1) for the sender - at the moment of receiving confirmation of acceptance for execution of the order for making the money transfer;

2) for the recipient - at the moment of receiving cash by him at the cash desk or peripheral device (ATM/terminal) of the bank or transfer/crediting of funds to the bank account specified by the recipient, to a bank payment card issued by the bank, and/or to an electronic wallet/electronic money.";

• paragraph 2.4 shall be stated in the following wording:

"2.4. The operator of a money transfer system (hereinafter - the operator) is a legal entity, resident or non-resident of the Kyrgyz Republic, having the corresponding permitting documents of the authorized body for financial supervision of the country of origin (license, registration certificate, etc.), registration with the National Bank and ensuring the functioning of the money transfer system. To develop the infrastructure and access points to the money transfer system, the operator concludes an agreement with the participants, according to which the operator and participants undertake to carry out their activities in providing money transfer services without opening a bank account in accordance with the rules of the system and the legislation of the Kyrgyz Republic.";

• paragraph 2.7 shall be stated in the following wording:

"2.7. A money transfer system is a type of payment system under which a participant of the payment system accepts funds from the population on the condition that these funds will be paid to the addressee. Through the money transfer system, money transfers are carried out both within the country (local) and crossing the state border of the Kyrgyz Republic (international, cross-border). Each money transfer in the system is assigned a unique identification number. The system must ensure that participants keep records for each money transfer with identification of senders and recipients of money transfers.";

• paragraph 3.1 shall be stated in the following wording:

"3.1. The operator (resident or non-resident of the Kyrgyz Republic), in order to provide services through money transfer systems on the territory of the Kyrgyz Republic, must undergo registration with the National Bank. The activity of payment system operators on the territory of the Kyrgyz Republic without registration with the National Bank is prohibited.

To undergo registration, the operator must provide to the National Bank the following original documents or duly certified copies thereof:

• an application letter for undergoing registration to provide services through money transfer systems indicating:

the name of the money transfer system;

the name of the operator of the money transfer system and the country of origin;

information about the address (location) of the operator;

the name of the settlement bank of the operator, if the operator is not a credit institution;

• a certificate of state registration of the legal entity issued by the authorized body for registration of legal entities of the country of origin;

• a certificate of registration with the tax authority of the country of origin;

• a certificate of registration of the payment system operator, a license/certificate for the right to carry out money transfers issued by the authorized body for financial supervision of the country of origin;

• the rules of the system approved by the founders of the money transfer systems;

• a model agreement with participants of the system, if any.

If the money transfer system belongs to a bank, duly certified copies of the following documents are additionally provided to the National Bank:

• a license for carrying out banking operations issued by the central (national) bank of the country of origin;

• a certificate of state registration of the legal entity issued by the authorized body for registration of legal entities of the country of origin;

• a certificate of registration with the tax authority of the country of origin.

The original document containing more than one sheet must be described sheet by sheet, stitched, numbered, signed and duly certified. Documents submitted by the operator of the money transfer system - a non-resident, must be legalized in the manner established by the normative legal acts of the Kyrgyz Republic.

At the request of the National Bank, documents must be provided in electronic form.

Within a period not exceeding 15 calendar days from the day of receipt by the National Bank from the operator of the application for registration and documents for undergoing registration, the National Bank adopts a decision on registration of this payment system operator or on refusal of registration. The time spent by the operator on finalizing documents is not included in the period for reviewing documents. If the submitted documents do not meet the requirements imposed by the National Bank, the counting of the period for reviewing documents begins from the date of receipt by the National Bank of documents satisfying the imposed requirements.

When adopting a decision on registration, the National Bank assigns a registration number to the operator of the money transfer system, includes information about it in the register of operators providing services through money transfer systems on the territory of the Kyrgyz Republic, and within a period not later than 7 calendar days from the date of adoption of the decision sends the operator a letter on undergoing registration. The procedure for maintaining the register of operators of money transfer systems is established by the National Bank.

In case of non-compliance of documents with the established requirements and/or provision of an incomplete package of documents, they are returned for finalization. The operator of the money transfer system, within a period of not more than 10 calendar days, must provide to the National Bank documents finalized taking into account the comments. In case of provision of documents that do not comply with the requirements of these Rules or not in full more than two times, the National Bank has the right to refuse registration to the operator of the money transfer system.

The operator of the money transfer system is obliged to notify the National Bank in writing of changes in any information specified during its registration within 3 working days from the moment of the occurrence of the changes. The National Bank, on the basis of the provided information, within 3 working days enters the information into the register of operators of money transfer systems.

The operator of the money transfer system at the stage of introducing new services/products/services (improvement) of the system on the territory of the Kyrgyz Republic must first inform the National Bank and send a notification with the attachment of detailed information describing the service/product/services being developed, the proposed changes/additions to the system and obtain the permission of the National Bank for the use of new services/products/services (improvement) of the system on the territory of the Kyrgyz Republic.

Documents provided by operators of money transfer systems to the National Bank are not returned.";

• paragraph 3.7 shall be stated in the following wording:

"3.7. The operator, except for the operator of local money transfer systems, in order to ensure a guarantee of financial obligations to the participant of the payment system, must ensure the fulfillment of at least one of the following conditions:

1) place on the correspondent account specified by the participating bank an obligatory insurance deposit in an amount covering the average daily turnover for all operations performed (per month/quarter/year as agreed). In case of non-fulfillment or improper fulfillment of obligations by the operator, the funds of the insurance deposit are used by the participant to satisfy claims under such obligations. In case of termination of the agreement on the provision of money transfer services without opening an account at the initiative of the operator or participant, the funds of the insurance deposit are returned to the operator in the manner and within the time periods provided for by the contractual relations;

2) provide a guarantee from a bank that has an international credit rating of investment level - not lower than category "BBB" assigned by the rating agency Standard & Poor's (USA), or not lower than category "Baa" by Moody's Investors Service (USA) or not lower than category "BBB" by Fitch-IBCA (USA), or has a rating of a national rating agency equivalent to the rating of the listed international rating agencies, which has received accreditation in the authorized bodies of the country of origin of the non-resident bank and whose rating is recognized by the central (national) bank of the country of origin.

A bank guarantee may also be provided by a bank that is an operator of a money transfer system and has a license to conduct banking operations. At the same time, the bank providing the guarantee must have an international credit rating of investment level - not lower than category "BBB" assigned by the rating agency Standard & Poor's (USA), or not lower than category "Baa" by Moody's Investors Service (USA) or not lower than category "BBB" by Fitch-IBCA (USA), or have a rating of a national rating agency equivalent to the rating of the listed international rating agencies, which has received accreditation in the authorized bodies of the country of origin of the non-resident organization and whose rating is recognized by the central (national) bank of the country of origin. The operator must provide to the National Bank documents confirming the existence of credit ratings of the guarantor bank. In case of deterioration of the rating (below the initial mark of the investment level credit rating) of the bank that provided the guarantee, the guarantor, the operator must within 30 calendar days replace the guarantee or provide security within the framework of subparagraphs 1 or 3 of this paragraph.

The bank has the right (if the bank has assessed all associated risks when working with the operator) not to require a bank guarantee if the operator of the payment system (or the parent company of the group to which the operator of the payment system belongs, exercising control over the operator of the payment system in accordance with the criteria of international financial reporting standards) has an international credit rating of investment level - not lower than category "BBB" assigned by the rating agency Standard & Poor's (USA), or not lower than category "Baa" by Moody's Investors Service (USA) or not lower than category "BBB" by Fitch-IBCA (USA), or has a rating of a national rating agency equivalent to the rating of the listed international rating agencies, which has received accreditation in the authorized bodies of the country of origin of the non-resident organization and whose rating is recognized by the central (national) bank of the country of origin. The operator must provide to the National Bank documents confirming the existence of credit ratings of the corresponding level. In case of deterioration of the rating (below the initial mark of the investment level credit rating) of the operator of the payment system (or the parent company of the group to which the operator of the payment system belongs, exercising control over the operator of the payment system in accordance with the criteria of international financial reporting standards), the operator (or the parent company of the group to which the operator of the payment system belongs, exercising control over the operator of the payment system in accordance with the criteria of international financial reporting standards) must within 30 calendar days replace the guarantee or provide security within the framework of subparagraphs 1 or 3 of this paragraph;

3) ensure insurance of money transfers carried out through its money transfer systems on the territory of the Kyrgyz Republic by concluding an insurance agreement where the beneficiary will be the participating bank, with insurance companies of the Kyrgyz Republic, or unless otherwise provided by the bank on mutually beneficial terms with the operator in bilateral agreements. The insurance agreement is concluded with each participating bank separately and must provide for the amount of insurance payment to the beneficiary sufficient to cover the financial obligations of the operator of the money transfer system upon the occurrence of an insured event.";

• paragraph 4.11 shall be stated in the following wording:

"4.11. The participant must quarterly, not later than the 15th day of the month following the reporting quarter, provide to the National Bank information in accordance with Annex 1 and information on the fulfillment of paragraph 3.7 of these Rules in accordance with Annex 2.

If the Participant has accepted a bank guarantee from the operator in accordance with subparagraph 2 of paragraph 3.7 of these Rules, it must monitor the rating of the guarantor bank to prevent risks of non-fulfillment of financial obligations by the operator and quarterly, not later than the 15th day of the month following the reporting quarter, provide to the National Bank information on the rating of the guarantor bank in accordance with Annex 2.";

• the Rules shall be supplemented with paragraph 6.6 in the following wording:

"6.6. The operator, at the request of the National Bank, must provide detailed information about the operation for the requested money transfer, about the sender and/or recipient of the money transfer (full name, year of birth, home address, passport data or data of the identity document), the purpose of the transfer, the amount of the transfer in figures with the attachment of copies of all confirming documents.

The operator is responsible for the actions of its agents and for the finality of transfers, starting from the moment funds are deposited at the agent's cash desk until their lawful issuance to the recipient.";

• the Rules shall be supplemented with Annex 2 of the following content:

		"Annex 2 to the Rules for Making Money Transfers through Money Transfer Systems in the Kyrgyz Republic

INFORMATION on the fulfillment of paragraph 3.7 of the Rules(*)

No.	Name of the money transfer system	Type of security under paragraph 3.7	Agreement number	Date of signing the agreement	Validity period of the agreement	Average daily turnover for the money transfer system (amount, currency)	Terms of the agreement									Credit rating of the operator of the money transfer system	Note/Other
Amount of security (insurance deposit, bank guarantee, money transfer insurance)	Currency (insurance deposit, bank guarantee, money transfer insurance)	Terms of placement of the insurance deposit		Bank guarantee
% rate	term	bank that issued the guarantee	guarantee number	date of issue	validity period of the guarantee	credit rating of the bank that issued the guarantee

(*) Data must be submitted on an A4 landscape sheet.

Executor	______
	indicate the full name of the person responsible for preparing the information, position, department/division, signature
Head of Department	______
	indicate the full name of the head of the department responsible for preparing the information, signature
Deputy Chairman	______
	indicate the full name of the person supervising this block, signature

Seal of the institution, date