Announcing the framework for local currency payment and bilateral retail payment connection using Vietnam-Laos QR code

NDO - On January 9, within the framework of the 47th meeting of the Vietnam-Laos Intergovernmental Committee on Bilateral Cooperation, under the witness of Prime Minister Pham Minh Chinh and Lao Prime Minister Sonexay Siphandone, the State Bank of Vietnam and the Bank of the Lao People's Democratic Republic held a ceremony to announce the framework for local currency payment and bilateral retail payment connection using QR codes between Vietnam and Laos.

Also attending were Deputy Prime Ministers, leaders of ministries, branches and agencies of the two countries.

This announcement ceremony is a vivid demonstration of effective cooperation between management agencies, enterprises and commercial banking systems of Vietnam and Laos in the context of promoting the use of local currencies, which has been a matter of great concern and direction to the leaders of the Party and Government of the two countries in recent times, and is also in line with the trend of monetary-banking cooperation in the ASEAN region.

Implementing the direction of the Party leaders and the Prime Ministers of the two countries, the State Bank of Vietnam and the Bank of the Lao People's Democratic Republic, together with the commercial banking systems of the two countries, have actively coordinated to promote the use of local currencies in payment transactions, money transfers, investment and borrowing of the two countries, through two initiatives/projects: Bilateral retail payment connection using QR codes and Completing the framework to promote the use of local currencies in payment, money transfers for trade, investment and borrowing.

Prime Minister Pham Minh Chinh and Lao Prime Minister Sonexay Siphandone and leaders of ministries and sectors of the two countries performed the Announcement ceremony at the ceremony. (Photo: THANH GIANG)

With the level of trust and comprehensive cooperation between Vietnam and Laos, along with the increasingly large and extensive presence and participation of Vietnamese enterprises investing in Laos as well as enterprises owned by Vietnamese people in Laos, promoting the use of local currency in payment transactions, money transfers for trade, investment and borrowing between Vietnam and Laos is expected to bring practical benefits to both sides, helping enterprises of the two countries have more options for transaction currencies, reducing operating costs due to not having to convert exchange rates to a third currency, creating more favorable business operations of enterprises when increasing access to capital sources in local currency for Vietnamese enterprises and investors in Laos...

At the announcement ceremony, Deputy Governor of the State Bank Pham Tien Dung summarized the results that the two Central Banks have actively implemented in 2024 on local currency cooperation, including the promulgation and completion of the legal framework in the two countries with Circular 04/2024/TT-NHNN dated May 31, 2024 of the State Bank of Vietnam to guide bilateral payments and money transfers with Laos, allowing all Vietnamese commercial banks to implement payments using local currency with Laos, and the Decision of the Governor of the Bank of the Lao People's Democratic Republic to license commercial banks to act as designated currency trading organizations (ACCD) between Vietnam and Laos.

On that basis, also at the above Announcement Ceremony, witnessed by the Prime Ministers of the two countries, Deputy Governor Soulysak Thamnuvong granted the license of the Governor of the Bank of the Lao People's Democratic Republic to the Lao-Vietnam Joint Venture Bank and Vietcombank Laos to participate in local currency payments.

With the legal framework as well as infrastructure for using local currency in payment and money transfer between Vietnam and Laos that has been completed in the banking sector in recent times, the two sides agreed to encourage businesses to use local currency in trade and investment activities between the two countries, initially encouraging corporations and general companies to consider implementing foreign trade contracts and investment contracts between the two countries in local currency.

Prime Minister Pham Minh Chinh and Lao Prime Minister Sonexay Siphandone, leaders of ministries, sectors and joint stock commercial banks of the two countries at the ceremony. (Photo: THANH GIANG)

Also at the announcement ceremony, the Prime Minister, Deputy Prime Minister and leaders of the two countries' ministries and branches performed the official ceremony to announce the connection of retail payment services using QR codes.

This project is expected to promote tourism, consumption and people-to-people exchanges between the two countries, while encouraging the use of local currencies in bilateral retail payments. This cross-border QR code payment service aims to provide people, tourists and merchants on both sides with a cheaper, faster, safer and more convenient payment method. As a result of cooperation since 2023 between the State Bank of Vietnam and the Bank of the Lao People's Democratic Republic, through two focal units, the National Payment Joint Stock Company of Vietnam (NAPAS) and the Lao National Payment Network Company (LAPNet) and commercial banks of the two countries, the two sides have so far completed the connection for the payment method of Vietnamese customers when purchasing goods and services in Laos.

Vietnamese banks participating in phase 1 of the above project include: VietinBank (as the settlement bank), Sacombank, BIDV, Vietcombank, BVBank, Nam A Bank and TPBank (service providing bank).

Participating banks on the Lao side include: VietinBank Laos (as the settlement bank), BCEL, APB, JDB, LVB, MJB, PSV, Sacombank Laos, STB, ACLEDA Bank Laos, BIC, IDB, VMB and LDB (service providing bank).

The two sides will continue to cooperate to improve the provision of this service in the future.

Source: https://nhandan.vn/cong-bo-khuon-kho-thanh-toan-ban-te-va-ket-noi-thanh-toan-ban-le-song-phuong-su-dung-ma-qr-viet-nam-lao-post855210.html