RESOLUTION OF BOARD OF NATIONAL BANK OF THE KYRGYZ REPUBLIC

of September 2, 2019 No. 2019-P-14/46-1-(PS)

About approval of the Provision "About Licensing of Activities of Payment Institutes and Operators of Payment Systems"

According to articles 20 and 68 of the Law of the Kyrgyz Republic "About National Bank of the Kyrgyz Republic, banks and banking activity" the Board of National Bank of the Kyrgyz Republic decides:

1. Approve the Provision "About Licensing of Activities of Payment Institutes and Operators of Payment Systems" it (is applied).

2. Recognize invalid:

- the resolution of Board of National Bank of the Kyrgyz Republic "About approval of the Provision "About Licensing of Activities of Operators of Payment Systems and Payment Institutes" of December 12, 2018 No. 2018-P-14/53-8-(PS)";

- the paragraph of the 9th Item 1 of the resolution of Board of National Bank of the Kyrgyz Republic "About introduction of amendments to some resolutions of Board of National Bank of the Kyrgyz Republic and recognition voided resolutions of Board of National Bank of the Kyrgyz Republic "About the amount of collection and payment for the licenses granted by National Bank of the Kyrgyz Republic" of June 8, 2017 No. 2017-P-12/23-4-(NPA)" of February 27, 2019 No. 2019-P-33/9-7-(NFKO);

- Item 9 of Appendix to the resolution of Board of National Bank of the Kyrgyz Republic "About introduction of amendments to some resolutions of Board of National Bank of the Kyrgyz Republic and recognition voided resolutions of Board of National Bank of the Kyrgyz Republic "About the amount of collection and payment for the licenses granted by National Bank of the Kyrgyz Republic" of June 8, 2017 No. 2017-P-12/23-4-(NPA)" of February 27, 2019 No. 2019-P-33/9-7-(NFKO).

3. To legal management:

- publish this resolution on the official website of 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.

4. This resolution becomes effective after fifteen days from the date of official publication, except for the paragraph "p") the subitem 2 Items 19, which becomes effective since January 1, 2021.

5. To management of payment systems to bring this resolution to the attention of payment institutes and operators of payment systems, OYuL "Association of Operators of KG Payment Service Providers", OYuL "Association of Telecom Operators", Interbank Processing Center Ltd and commercial banks.

6. To department of development of official language and document flow to bring this resolution to the attention of the relevant structural divisions, regional managements and representative office of National Bank in Batken Province.

7. To impose control of execution of this resolution on the board member of the National Bank of the Kyrgyz Republic supervising Management of payment systems.

Appendix

to the Resolution of Board of National Bank of the Kyrgyz Republic of September 2, 2019 No. 2019-P-14/46-1-(PS)

Regulations on licensing of activities of payment institutes and operators of payment systems

Section 1. Payment institutes and operators of payment systems and their shareholders (founders)/participants

Chapter 1. General provisions

1. This Provision "About Licensing of Activities of Payment Institutes and Operators of Payment Systems" (further - the Provision) determines procedure for issue by National Bank of the Kyrgyz Republic (further - National Bank) licenses to payment institutes and operators of payment systems on implementation of activities on:

1) to rendering services in acceptance and carrying out payments and calculations for the goods and services which are not result of the activities for benefit of the third parties by means of the payment systems based on information technologies and electronic means and methods of carrying out payments;

2) to rendering services in acceptance, processing and issue of financial information (processing, clearing) on payments and calculations of the third parties to members of payment service provider, this processing, clearing center.

This Provision also establishes requirements to payment institutes and operators of payment systems and to their officials.

2. The payment institute and the operator of payment system are created in form of business of joint-stock company or limited liability company, perform activities on the basis of the constituent documents conforming to requirements of the legislation of the Kyrgyz Republic based on the license of National Bank according to the legislation of the Kyrgyz Republic.

2-1. The operator of payment system can combine the activities only with activities of payment institute.

The payment institute can combine the activities only with activities of the operator of payment system.

The operator of payment system / payment institute has the right to be engaged only in those types of activity which are specified in the license, and also to render consulting/information services and to perform other activities which are accompanying to the main or are necessary for providing its main activities.

The payment institute in the presence of the license of the operator of payment system has the right to render as the accompanying activities services in acquiring of the bank payment cards on condition of fulfillment of requirements established by this Provision and regulatory legal acts of National Bank.

3. The license granted by National Bank is termless, inaliennable and is not subject to transfer to the third parties.

4. The amount of the state tax paid for licenses of payment institute and the operator of payment system is determined according to the legislation of the Kyrgyz Republic.

5. Licensees shall within 15 (fifteen) working days from the date of decision making of management by the relevant authorized body notify National Bank:

- about change of the size of the authorized capital;

- about liquidation or reorganization;

- about change of structure of executive, supervisory governing bodies (the board of directors - in the presence);

- about change of legal and/or actual addresses of the organization;

- about opening of representations and/or branches in areas or outside the Kyrgyz Republic.

Licensees also shall notify National Bank on change of list of founders (shareholders/participants) and/or the sizes of their shares / shares in the organization owing to their acquisition / sale / transfer in any manner, and also on transfer of shares/share of founders (shareholders/participants) of the organization to trust management to the third parties. The notification shall be sent to National Bank within 15 (fifteen) working days from the date of adoption by founders (shareholders/participants) of the corresponding solutions / conclusions of agreements/agreements and other bases according to the legislation of the Kyrgyz Republic.

Notifications shall go in writing with appendix of the copies of relevant decisions of authorized bodies of management certified by the licensee (or originals of statements from such decisions) and other supporting documents including provided by this Provision.

The National Bank has the right to request the additional documents / data concerning the accepted changes.

6. In case of violation of requirements of this provision the National Bank has the right to apply to the payment organization / operator of payment system and their officials corrective actions according to the legislation of the Kyrgyz Republic.

Chapter 2. Terms and determinations

7. Within this provision the following terms and determinations are used:

The applicant - the joint-stock society / limited liability company which addressed to National Bank for receipt of the license for the right of implementation of activities of payment institute and/or the operator of payment system according to this Provision.

The licensee - the payment institute and/or the operator of payment system who received the license of National Bank for the right of implementation of the related activity.

Officials - members of supervisory governing body (The board of directors - in the presence), the members of executive body and/or persons equated to them on the functional obligations, performing management of the current activities of payment institute and/or the operator of payment system.

The faces tied with payment institutes and/or operators of payment systems:

1) officials of payment institute and/or operator of payment system and their close relatives;

2) other legal entities or physical persons which directly or indirectly have considerable equity participation of the payment organization / operator of payment system and/or exercise control;

3) members of supervisory and executive governing bodies of the legal entities specified in the subitem 2 presents of determination and their close relatives;

4) close relatives of the physical persons specified in the subitem 2 presents of determination;

5) other legal entities in whom persons specified in the subitem 2 presents of determination have considerable participation and/or exercise control.

The terms "considerable participation" and "control" are understood in those values which are specified in article 22 of the Law of the Kyrgyz Republic "About banks and banking activity".

Criteria of the concept "faultless goodwill" are understood in those values which are specified in article 45 of the Law of the Kyrgyz Republic "About banks and banking activity".

Chapter 3. Authorized capital

8. The authorized capital of payment institute and the operator of payment system is created only in national currency at the expense of money of shareholders (founders)/participants brought on the bank account in commercial bank.

Forming of the authorized capital for the fixed asset account and intangible assets is forbidden. Use of the money deposited for the purpose of forming of the authorized capital in volume of the required minimum size of the authorized capital, before adoption by National Bank of the decision on issue/refusal in licensing is forbidden.

9. The basis of the capital of payment institute and the operator of payment system is constituted by completely paid authorized capital. Only such authorized capital on which the payment institute or the operator of payment system has no obligations on return of means is equity composition.

10. The minimum size of the authorized capital of the payment organization / operator of payment system shall constitute:

- at least 2000000 (two million) som for payment institute;

- at least 1000000 (one million) som for the operator of payment system.

If the applicant files documents on two licenses / the licensee combines activities of payment institute and the operator of payment system, the authorized capital of this organization shall constitute at least 3000000 (three million) som.

11. When implementing activities for rendering services in acceptance and carrying out payments and calculations for the goods/services which are not result of the activities for benefit of the third parties - suppliers of goods / uslug-nerezidentov, in the presence of direct contracts with these suppliers / integration of technical platforms and implementation of financial settlement on cross-border payments, the authorized capital of payment institute shall be in the amount of at least 10000000 (ten million) som.

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