What is the maximum deposit insurance payment limit in Vietnam?

Hello, Lawnet would like to answer as follows

1. What is deposit insurance?

In Article 4 of the Law on Deposit Insurance 2012, the concept of deposit insurance is clearly stated as follows:

Deposit Insurance is a guarantee for repayment of deposits to the insured persons of deposit within the limit of premium payment when the deposit insurance participating organizations fall into the state of inability to repay deposits to the depositors or go bankrupt.

Deposit insurance participating organizations are foreign credit organizations and banking branches established and operating under the Law on credit organizations are entitled to receive deposits of individuals.

Therefore, it can be understood that deposit insurance is a type of insurance to ensure the rights of insured persons of deposit at credit institutions in case the credit institution is unable to return money or falls into bankruptcy.

Deposit insurance plays an important role in ensuring the legal rights and interests of savers, thereby strengthening customers' confidence when depositing savings at credit institutions.

Currently, the foreign credit organizations and banking branches are entitled to receive the deposits of individuals must participate in deposit insurance, except for policy banks. (Article 6 of the Law on Deposit Insurance 2012).

2. What is the maximum deposit insurance payment limit in Vietnam?

The maximum deposit insurance payment limit is clearly stated in Article 3 of Decision 32/2021/QD-TTg as follows:

Article 3. Insurance payment limit

The maximum amount paid by a deposit insurance organization for all insured deposits according to the provisions of the Deposit Insurance Law (including principal and interest) of a person at an organization participating in deposit insurance When the insurance payment obligation arises, it is 125,000,000 VND (one hundred twenty-five million VND).

Thus, the maximum deposit insurance payment limit for savings depositors at credit institutions in general or banks in particular will be 125 million VND.

Therefore, in case a credit institution declares bankruptcy, savers can only receive a maximum deposit insurance amount of VND 125 million along with compensation through the asset liquidation of the bankrupt credit institution.

3. What are the regulations on deposit insurance fees in Vietnam

Deposit insurance fees are regulated in Article 20 of the Law on Deposit Insurance 2012 as follows:

- The Prime Minister has regulated the fee framework of the deposit insurance at the request of the State Bank of Vietnam.

- Based on the fee framework of the deposit insurance, the State Bank of Vietnam shall regulate the specific fee rate ofthe deposit insurance for the deposit insurance participating organizations on the basis of assessment and classification of these organizations

- The deposit insurance fees are calculated on the basis of the average deposit balance of the insured deposit at the deposit insurance participating organizations.

- The deposit insurance fees are calculated and paid quarterly in the fiscal year. The deposit insurance participating organizations have to pay the deposit insurance fees to the deposit insurance organizations on the 20th date of the first month of the succeeding quarter at the latest.

- The deposit insurance fees are recorded into the operation expenses of the deposit insurance participating organizations.

Best regards!

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