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Continuing credit support programs for businesses

For the business community, especially those directly affected by the Covid-19 epidemic, access to preferential loans and credit support for reinvestment in production and business after 1 year to cope with the significant impacts of the Covid-19 pandemic is necessary.


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Cash counting activities at a commercial bank, a branch in Bien Hoa city.

The Governor of the State Bank of Vietnam has issued Circular No. 03/2021/TT-NHNN (hereinafter referred to Circular 03) amending, supplementing a number of articles of Circular No. 01/2020/TT-NNHN on the credit institutions, foreign bank branches restructure the repayment term, exempt, reduce interest and fees, maintain the debt group in order to support customers affected by the Covid-19 epidemic.

In recent years, credit institutions in the province have accelerated capital flows into production and business activities, including credit packages and plans to support businesses and customers affected by the Covid-19 epidemic.

In addition, credit institutions in the province also lend new loans at preferential interest rates with accumulated sales from January 23, 2020 to the end of February 2021 reache more than VND 121.9 trillion for over 27.6 thousand customers, interest rates is lower than the common rate from 0.5-2.5% compared to before the Covid-19 epidemic. In particular, with the new Circular 03 issued by the State Bank in last April will continue to open up many opportunities so that businesses can access loans at appropriate interest rates, restructure debt repayment terms, etc. This Circular has many new points compared to the previous Circular No. 01/2020/TT-NHNN, where there were still limits. Circular 03 takes effect from May 17, 2021.

According to Mr Pham Quoc Bao, Deputy Director of the State Bank of Vietnam’s Dong Nai branch, Circular 03 has many new points. In which, credit institutions restructure the repayment term for the balance of debts arising before June 10, 2020 from lending, finance leasing activities and incurring the obligation to repay the principal or interest for the period from January 23, 2020 to December 31, 2021.

At the same time, credit institutions have right to decide on the exemption and reduction of interest and fees according to internal regulations for outstanding balances of debts arising before June 10, 2020 from credit extension activities that customers have to pay within 2 years 2020-2021 but they cannot due to the impact of the Covid-19 epidemic. The rescheduling of debt repayment terms and the exemption and reduction of interest and fees for customers will be implemented until December 31, 2021.

Regarding the preservation of the debt group, according to this circular, credit institutions are allowed to keep the group of debts classified according to regulations at the nearest time before January 23, 2020 for the balance of debts incurred before the January 23, 2020 is eligible for debt repayment term restructuring, interest exemption and reduction, including the debt balance for which the repayment term has been restructured, interest exemption and reduction, and debt group adjusted according to regulations in the period from January 23, 2020 to March 29, 2020. In addition, credit institutions are also allowed to keep the classified debt group with the debt balance having the debt repayment term restructured, interest exempted, and reduced from January 23, 2020 to before June 10, 2020 according to regulations.

 “In particular, Circular 03 also adds provisions for setting up risk provisions. Credit institutions must make a specific provision for the entire customer's outstanding balance according to the classification results for the remaining debt group and classification results for the remaining outstanding loans of the customer. If the specific provision amount is positive, the credit institutions must make additional deductions according to the schedule for 3 years and 100% of the deduction will be made by the end of 2023" emphasized by Mr Pham Quoc Bao.​

Nam Huu​

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