11 operations of financial companies in Vietnam

According to Decree No. 39/2014/NĐ-CP of Vietnam’s Government, a general financial company means a financial company which may perform activities prescribed in the Law on Credit Institutions and this Decree.

Chapter of Decree No. 39/2014/NĐ-CP specifies operations of financial companies, including:

- Banking operations of financial companies;

- Issuance of deposit certificates, promissory notes, bills or bonds to raise capital from organizations;

- Borrowing loans from domestic and overseas credit institutions and financial institutions;

- Borrowing loans from the State Bank in the re-financing form;

- Provision of loans, including amortized loans and consumer loans;

- Bank guarantee;

- Factoring;

- Issuance of credit cards;

- Financial leasing;

- Other activities of financial companies;

- Operations of factoring financial companies and consumer credit financial companies.

Moreover, financial companies are also classified as follows:

- General financial company means a financial company which may perform activities prescribed in the Law on Credit Institutions and this Decree.

- Specialized financial companies include factoring financial companies, consumer credit financial companies and financial leasing companies as defined in this Decree and guided by the State Bank of Vietnam (below referred to as the State Bank).

- Factoring financial company means a specialized financial company mainly engaged in factoring activities under this Decree.

- Consumer credit financial company means a specialized financial company mainly engaged in consumer credit activities under this Decree.

- Financial leasing company means a specialized financial company mainly engaged in financial leasing under this Decree. Financial leasing debit balance must make up at least 70% of the total credit balance.

View more details at Decree No. 39/2014/NĐ-CP of Vietnam’s Government, effective from June 25, 2014.

Le Hai

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