DECREE

PRESCRIBING INTEREST RATE SUPPORT FOR LOANS GRANTED BY VIETNAM BANK FOR SOCIAL POLICIES, FUNDING SOURCES, SUBSIDY ON INTEREST RATE AND MANAGEMENT FEES GRANTED TO VIETNAM BANK FOR SOCIAL POLICIES FOR GRANTING LOANS UNDER NATIONAL ASSEMBLY’S RESOLUTION NO. 43/2022/QH15 DATED JANUARY 11, 2022 ON FINANCIAL AND MONETARY POLICIES FOR IMPLEMENTATION OF SOCIO-ECONOMIC RECOVERY AND DEVELOPMENT PROGRAM

Pursuant to the Law on Government Organization dated June 19, 2015; the Law on Amendments to the Law on Government Organization and the Law on Local Government Organization dated November 22, 2019;

Pursuant to the Law on State Budget dated June 25, 2015;

Pursuant to the Law on Public Investment dated June 13, 2019;

Pursuant to the Resolution No. 43/2022/QH15 dated January 11, 2022 of the National Assembly on financial and monetary policies for implementation of the Socio-economic recovery and development program;

At the request of the Minister of Finance of Vietnam;

The Government promulgates a Decree prescribing interest rate support for loans granted by Vietnam Bank for Social Policies, funding sources, subsidy on interest rate and management fees granted to Vietnam Bank for Social Policies for granting loans under the National Assembly’s Resolution No. 43/2022/QH15 dated January 11, 2022 on financial and monetary policies for implementation of the socio-economic recovery and development program.

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This Decree deals with:

1. The mechanism for grant of interest rate support for loans granted by Vietnam Bank for Social Policies (VBSP) as prescribed in Point b Sub-clause 1.2 Clause 1 Article 3 of the Resolution No. 43/2022/QH15 dated January 11, 2022 of the National Assembly and Point d Clause 2 Section II of the Resolution No. 11/NQ-CP dated January 30, 2022.

2. Funding for granting loans and subsidy on interest rate and management fees granted to VBSP for implementing preferential lending policies as prescribed in Point b Sub-clause 1.3 Clause 1 Article 3 of the Resolution No. 43/2022/QH15 and Point c Clause 2 Section II of the Resolution No. 11/NQ-CP (hereinafter referred to as “preferential lending policies under Resolution No. 43/2022/QH15”).

Article 2. Regulated entities

1. Vietnam Bank for Social Policies (VBSP).

2. VBSP’s borrowers (including organizations and individuals) whose loans are eligible for interest rate support granted from state budget as prescribed in Article 4 of this Decree.

3. Other relevant organizations and individuals.

Article 3. Rules for providing interest rate support

1. Interest rate support must be provided for right beneficiaries and right purposes in a public and transparent manner in order to avoid profiteering the policy.

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3. VBSP shall provide interest rate support in such a manner that complies with regulations of law and facilitates borrowers.

4. Overdue outstanding debts or extended debts shall not be eligible for interest rate support.

Article 4. Eligibility for interest rate support

A borrower may receive interest rate support when meeting all of the following eligibility requirements:

1. The borrower’s loan meets the following conditions:

a) The loan is granted by VBSP under a credit program enclosed with the Government’s Decree, the Prime Minister’s Decision, written delegation of a local government, business entity, socio-political organization, trade association, domestic or foreign individual, agreement on on-lending of ODA loans or foreign concessional loans, or another foreign donation agreement;

b) The interest rate charged on the loan is higher than 6%/year;

c) The loan has been disbursed by VBSP and outstanding debt occurs in the effective period of interest rate support policy.

2. The borrower is eligible to get the loan and has used the borrowed fund for the prescribed purposes.

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1. The interest rate support shall be provided from January 01, 2022 to December 31, 2023 or until VBSP notifies the termination of the interest rate support program as prescribed in Point g Clause 2 Article 10 of this Decree, whichever comes first.

2. The loan term granted interest rate support is the period which begins on the date of disbursement and ends on the date of full repayment of the loan principal, and must fall within the interest rate support period.

3. The rate of support is 2%/year of the outstanding debt of the loan amounts disbursed within the interest rate support period and supported loan term.

4. The actual support amount per loan amount shall be determined according to Point b Clause 3 Article 7 of this Decree.

Article 6. Methods of providing interest rate support

1. Funding from state budget shall be allocated to VBSP for providing interest rate support for eligible borrowers in accordance with regulations herein.

2. VBSP shall monthly calculate and deduct the support amount from total interest payable of each borrower.

Article 7. Procedures for annual allocation of funding derived from state budget to VBSP for providing interest rate support

1. Make and allocate state budget estimates for providing interest rate support:

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b) VBSP shall prepare and submit the interest rate support plan for the year 2022 and the year 2023 to the Ministry of Planning and Investment and the Ministry of Finance;

c) Based on the plan submitted by VBSP as prescribed in Point b of this clause, the Ministry of Planning and Investment shall take charge of reporting and requesting the Government to obtain permission from the Standing Committee of National Assembly to provide additional funding for the estimated state budget-derived investment and development funding for providing interest rate support in 2022, and include it in the state budget estimate in 2023 which will then be submitted to the National Assembly for consideration;

d) The Prime Minister shall, pursuant to the Resolution of the Standing Committee of National Assembly on inclusion of additional funding in the state budget estimate of 2022, decide to allocate additional funding derived from central-government budget for implementing the public investment plan in 2022 to VBSP. The allocation of the public investment plan in 2023 shall comply with regulations of law in force.

dd) Within the scope of the annual public investment plan allocated by the Prime Minister, VBSP shall allocate interest rate support quotas to its branches. During the provision of interest rate support, VBSP may adjust the support quotas between its branches if it is deemed necessary provided that total quotas allocated to its branches shall not exceed the annual interest rate support plan allocated by a competent authority.

2. Implement the annual state budget estimate for providing interest rate support:

a) By the 10^th day of the first month of each quarter, VBSP shall send an application to the Ministry of Finance of Vietnam for partial reimbursement of interest rate support amounts provided as prescribed in this Decree in the previous quarter. Such application includes:

- The application form for partial reimbursement of provided interest rate support amounts, in which total interest rate support amounts provided for borrowers in the previous quarter, requested reimbursement amount which equals 85% of total interest rate support amounts provided for borrowers in the previous quarter, and receiving account number of VBSP shall be specified.

- The report on provision of interest rate support in the previous quarter which is made using the Form in Appendix I enclosed herewith.

b) Within 15 working days from the receipt of an adequate application from VBSP, the Ministry of Finance shall partially reimburse the interest rate support amounts to VBSP as prescribed in Point a of this Clause in the form of payment order and notify such reimbursement to VBSP for cooperation.

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3. Make and approve annual statement of interest rate support:

a) Each branch of VBSP shall prepare and submit its annual statement of interest rate support amounts to VBSP (Operations Center) by February 10 of the year following the year of statement for consideration. Loans specified in the statement must have been granted to eligible borrowers and meet all of requirements for interest rate support in accordance with this Decree.

b) The interest rate support amount is determined as follows:

- The actual interest rate support amount for a disbursed amount is calculated adopting the following formula:

Where: - L: The actual interest rate support amount for a disbursed amount;

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- The actual interest rate support amount for a loan is total actual interest rate support amounts for all disbursed amounts of the loan during the interest rate support period;

- Total interest rate support amount to be reimbursed by state budget as requested is the sum of actual interest rate support amounts for all loans meeting requirements for interest rate support as prescribed in this Decree.

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d) By October 01 of the year following the year of statement, VBSP shall prepare and submit an application for appraisal of the statement to the Ministry of Finance. Such application includes: The application form for appraisal of statement of interest rate support; the consolidated statement of interest rate support (which has been audited); the copy of the audit report given to VBSP by the State Audit Office of Vietnam.

4. Appraise annual statement of interest rate support and notify appraisal results

a) Carry out appraisal:

Within 10 working days from the receipt of the application for appraisal from VBSP, the Ministry of Finance shall check the adequacy and validity of the application, and request VBSP to modify the application if it is inadequate as prescribed in Point d Clause 3 of this Article.

After receipt of the adequate application for appraisal from VBSP, the Ministry of Finance shall carry out appraisal with the following contents:

- Check to ensure the consistency between the interest rate support estimate allocated in the year and the estimate allocated by competent authorities (including those allocated at the beginning of the year and modified or adjusted in the year);

- Check the interest rate support amounts reimbursed by state budget;

- Check to ensure that total interest rate support amount to be reimbursed by state budget at the request of VBSP has been corrected according to conclusion given by the State Audit Office of Vietnam;

- Check and determine whether the interest rate support amount which has been reimbursed to VBSP is lower or greater than the appraised amount (if any);

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b) Notify appraisal results

Within 30 working days from the receipt of the adequate application for appraisal from VBSP, the Ministry of Finance shall, based on the results of the appraisal which is conducted according to Point a of this Clause, send a notice of appraisal results to VBSP. The notice shall indicate:

- The interest rate support amount reimbursed to VBSP in the year which is based on the data audited by State Audit Office of Vietnam; The amount included in the state budget statement of the budget year is the state budget-derived amount reimbursed to VBSP from January 01 of the budget year to January 31, 2023, in respect of interest rate support amounts provided in 2022, or to January 31, 2024, in respect of interest rate support amounts provided in 2023;

- The interest rate support amount to be reimbursed to VBSP, or recovered or deducted from that payable in the following year. In case total amount reimbursed in the year is lower than the one appraised, VBSP shall receive additional reimbursement. In case total amount reimbursed in the year is greater than the one appraised, the difference is returned to state budget or deducted from the interest rate support amount to be reimbursed in the following year.

5. Settle recovered interest rate support amounts

a) During the implementation of interest rate support policy, if a loan is found to fail requirements for interest rate support set out in this Decree, VBSP shall immediately recover the interest rate support amount provided for the borrower;

b) In case the interest rate support amount for the loan prescribed in Point a of this Clause has been reimbursed by state budget or recorded in the annual statement, VBSP shall return money to state budget or notify to deduct such amount from the interest rate support amount in the following year.

Article 8. Funding sources, subsidy on interest rate and management fees

1. Funding sources

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b) The limit on government-guaranteed bonds issued to raise funds for providing preferential loans under the Resolution No. 43/2022/QH15 is VND 38,4 thousand billion and shall not exceed total outstanding debt of credit facilities extended under preferential lending policies under the Resolution No. 43/2022/QH15 at the time of termination of the Resolution No. 43/2022/QH15 plus the ratio of available cash to total outstanding debt specified in this Point. The ratio of available cash is determined according to the maximum ratio of cash and deposits at other credit institutions to ensure the solvency when determining the subsidy on interest rate and management fees in accordance with VBSP's financial management regulations;

 c) Funds raised from the issuance of government-guaranteed bonds as prescribed in this Clause shall be included in total capital of VBSP, and recorded, managed and used in accordance with VBSP's financial management regulations;

d) While government-guaranteed bonds are not yet issued or sufficiently issued, VBSP shall use its lawful funding to provide preferential loans in accordance with the Resolution No. 43/2022/QH15.

2. Subsidy on interest rate and management fees

a) VBSP shall receive subsidy on interest rate and management fees from state budget when providing preferential loans under the Resolution No. 43/2022/QH15 according to the mechanism for subsidy on interest rate and management fees when providing loans to the poor and other policy beneficiaries set out in VBSP’s financial management regulations;

b) Funding for granting subsidy on interest rate and management fees

- Funding for granting subsidy on interest rate and management fees in the 2022 – 2023 period for providing preferential loans under the Resolution No. 43/2022/QH15 is VND 2 thousand billion prescribed in Point b Clause 1.2 Clause 1 Article 3 of the Resolution No. 43/2022/QH15;

- Funding for granting subsidy on interest rate and management fees after 2023 in respect of outstanding debts of preferential loans provided under the Resolution No. 43/2022/QH15 shall be included in the public investment funding allocated in accordance with the Law on state budget, the Law ob public investment and other guiding documents (if any).

Article 9. Reporting

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2. Data collection duration, submission deadlines and methods

a) Submission deadlines:

- A quarterly report shall be submitted within 10 days from the end of the reporting quarter;

- An annual report shall be submitted within 60 days from the end of the reporting year;

- The report upon completion of the interest rate support program shall be submitted within 60 days from the completion of the program.

b) Data collection period of quarterly and annual reports: A quarterly or annual report shall include data collected from the first day of the reporting quarter or year to the last day of the same quarter or year.

c) Data collection period of the report upon completion of the interest rate support program: The report upon completion of the interest rate support program shall include data collected from January 01, 2022 to December 31, 2023 or the time of notification of termination of the interest rate support program as prescribed in Point g Clause 2 Article 10 of this Decree, whichever comes first.

d) Reports shall be submitted adopting one of the following methods:

- Direct submission of physical reports;

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- Submission of reports by email or through the specialized reporting software system;

- Other methods as prescribed by law.

Article 10. Implementation organization

1. Borrowers receiving interest rate support shall:

a) use the borrowed funds for proper purposes as prescribed;

b) if failing to meet the requirements for interest rate support set out in this Decree, return the entire loan amounts granted to ineligible borrowers and/or used for wrong purposes (if any); interest rate support amounts granted to loans which fail to meet requirements for interest rate support.

2. VBSP shall:

a) submit a consolidated report on demands for interest rate support, subsidy on interest rate and management fees to the Ministry of Planning and Investment and Ministry of Finance for allocating funding to VBSP in accordance with the Law on state budget, the Law on public investment, Resolution No. 43/2022/QH15 and other guiding documents (if any);

b) instruct its branches to submit reports on their provision of interest rate support on a quarterly and annual basis and upon completion of the interest rate support program; instruct its branches to provide interest rate support and make statement of provided interest rate support amounts in accordance with regulations of this Decree and other relevant legislative documents;

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d) assume a whole responsibility for the legitimacy, adequacy, validity and accuracy of applications for appraisal of statement of provided interest rate support amounts and data contained therein. Retain all documents on provision of interest rate support for each loan as prescribed;

dd) submit reports on provision of interest rate support according to reporting regulations set out in Article 9 of this Decree;

e) provide loans for eligible borrowers; carry out inspection before, during and after provision of loans to ensure that the interest rate support is provided in accordance with regulations of law. if detecting a borrower that fails to meet the requirements for interest rate support, recover the entire loan amounts granted to ineligible borrowers and/or used for wrong purposes (if any); interest rate support amounts granted to loans which fail to meet requirements for interest rate support;

g) depending on the provision of interest rate support, when the funding allocated to VBSP under the Resolution No. 43/2022/QH15 is not sufficient to provide interest rate support for the following month, VBSP shall terminate provision of interest rate support, notify such termination on its website and at its head office, and submit report on such termination to the Prime Minister and the Ministry of Finance;

h) separately monitor outstanding debts of preferential loans granted under the Resolution No. 43/2022/QH15 according to the following rules:

- With regard to preferential loans provided under the Resolution No. 43/2022/QH15 and another annual credit program promulgated by the Prime Minister (other than the plan for providing preferential loans under the Resolution No. 43/2022/QH15), outstanding debts shall be recorded as those of preferential loans provided under the Resolution No. 43/2022/QH15 until the limit on outstanding debts of preferential loans granted under the Resolution is reached;

- With regard to loans provided for students under the Prime Minister's Decision No. 157/2007/QD-TTg dated September 27, 2007 and its amending documents, outstanding debts shall be recorded as those of the preferential loans granted under the Resolution No. 43/2022/QH15 after state budget-derived funding and loans obtained from the State Bank of Vietnam allocated to this lending program have been used up.

i) calculate, determine and assume responsibility for the subsidy on interest rate and management fees when providing preferential loans under the Resolution No. 43/2022/QH15;

k) report the Ministry of Planning and Investment and the Ministry of Finance for consolidating and reporting the Government or the Prime Minister for reporting the National Assembly on issuance of government-guaranteed bonds and provision of preferential loans under the Resolution No. 43/2022/QH15 in April, 2024.

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a) based on the allocated state budget estimates, provide funding to VBSP for providing interest rate support in accordance with regulations herein;

b) carry out appraisal of statement of interest rate support amounts and notify appraisal results to VBSP in accordance with regulations herein.

4. The Ministry of Planning and Investment shall: play the leading role and cooperate with the Ministry of Finance in requesting competent authorities to balance and allocate funding for providing interest rate support and subsidy on interest rate and management fees to VBSP in accordance with the Law on state budget, the Law on public investment, Resolution No. 43/2022/QH15 and other guiding documents (if any).

5. Local governments at all levels shall:

a) closely cooperate with VBSP to provide interest rate support in accordance with regulations herein;

b) instruct the representative boards of Boards of Directors of VBSP and its branches to frequently inspect and supervise the implementation of this Decree.

6. Central committee of the Vietnamese Fatherland Front and socio-political organizations are requested to participate in dissemination, cooperation in and inspection of implementation of this Decree.

Article 11. Implementation

1. This Decree comes into force from the date on which it is signed.

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3. The Ministry of Finance, Ministry of Planning and Investment, VBSP and relevant organizations and individuals are responsible for the implementation of this Decree.

ON BEHALF OF THE GOVERNMENT
PP. PRIME MINISTER
DEPUTY PRIME MINISTER




Le Minh Khai