Decision: Promulgating the Regulation on Loan Provision to Customers by Credit Institutions

This paper describes the regulations imposed on credit institutions in Vietnam which offer loans to borrowers. The new guidelines, as framed in the 'Articles' of this law, replace the older 'orders' relating to the same subject with effect from Oct 15th, 1998.

Chapter I enacts the general provisions and the salient features are:

• The law is applicable to credit institutions and customers borrowing loans in Vietnam dong and foreign currencies for business and development;
• The chapter defines and interprets the use of common terms used widely in Chapter II of the paper.

Chapter II incorporates the specific provisions and its salient features include:

• The principles for:
  • Capital borrowing (for customers);
  • Capital lending (for credit institutions).
• The types of loans and the purposes for which loans can be advanced by credit institutions;
• The terms and conditions for loan advancement to customers;
• The rights and obligations of the credit institutions and customers.

In conclusion, Chapter III briefly states the implications for violating this 'regulation' applicable on the credit institutions and capital borrowers.