Notice from Bank of Lao PDR on the Monitoring of Use of Payment Services

On 2 March 2021, the Department of Payment System Management, Bank of Lao PDR ("BOL") issued Notice No. 161/DPSM on the monitoring of the use of payment services of commercial banks, non-commercial financial institutions, and legal entities that provide payment services ("Notice"). Inspections have shown that a number of groups and companies have used the products, channels, and payment tools of commercial banks, non-commercial financial institutions, and legal entities without complying with the regulations of the BOL and Payment Service Providers. Examples of such regulations relate to the use of QR Code label to receive money transfer to a third party, and the use of Point of Sales tools (POS) to exchange foreign currency and for payment for goods or services not within their stores. These constitute a violation of the Law on the Payment System.

Therefore, BOL issued the Notice for commercial banks, non-commercial financial institutions and legal entities that provide payment services to implement the following:

1. Strict and heightened monitoring, inspection, and search of data of clients prior to providing payment services, especially those who use the products, channels, and payment tools of commercial banks, non-commercial financial institutions, and legal entities payment services providers.


2. Widely disseminate to businesses and consumers their management rules and the use of their products through notices, advertising media, and social network.


3. Carefully review the agreements/applications for using the products, channels, and payment tools that they entered into with the businesses and ensure that the latter comply with the relevant regulations relating to payment of products and services. They must ensure that the businesses are not in breach of the regulations.


4. In cases where a business is found to have engaged or suspected of engaging in any activity that is in breach of the relevant rules and regulations, such business shall be stopped immediately, and the relevant information reported to BOL.


5. Where there is suspicion that individuals, entities, and stores are using the payment services of commercial banks, non-commercial financial institutions, and legal entities for money laundering or terrorist financing, the information should be compiled and reported directly to the Anti-Money Laundering Intelligence Office (AMLIO), copying BOL.