Approval of the Principle of Establishing the People’s Credit Fund Implementing NTN?

Approval in principle for the establishment is one of the procedural steps in granting the Establishment License for people's credit funds, as guided in Circular 04/2015/TT-NHNN amended and supplemented by Clause 4, Article 2 of Circular 21/2019/TT-NHNN, specifically:

Illustrative image (source: internet)

- The preparatory committee shall prepare an application dossier for the Establishment License in accordance with clauses 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, and 16 of Article 11 of this Circular and send it by post or submit it directly to the local branch of the State Bank of Vietnam (SBV branch);- Within 10 working days from the date of receipt of the dossier, the SBV branch shall issue a document to the preparatory committee confirming that the application dossier is complete and valid or requesting supplementation and completion of the dossier;- Within 10 working days from the date of receipt of the complete and valid dossier, the SBV branch shall:

- Issue a document seeking the opinion of the People's Committee at the commune level where the people's credit fund is proposed to be headquartered regarding the establishment of the people's credit fund in the locality; and the proposed list of candidates for election and appointment as Chairman and other members of the Board of Directors, Head and members of the Supervisory Board, Director of the people's credit fund;- Issue a document to the Vietnam Cooperative Bank regarding the proposed list of candidates for election and appointment as Chairman and other members of the Board of Directors, Head, and members of the Supervisory Board, Director of the people's credit fund (if deemed necessary);

- Within 10 working days from the date of receipt of the request from the SBV branch, the People's Committee at the commune level where the people's credit fund is proposed to be headquartered, and the Vietnam Cooperative Bank shall issue a written opinion on the requested contents. If the time limit elapses without receiving any written opinion from these entities, the SBV branch shall assume that the entities consulted have no objections;- Within 30 days from the date of receipt of the opinion from the People's Committee at the commune level, the Vietnam Cooperative Bank, or from the expiry of the consultation period without receiving any opinions, the SBV branch shall issue a document to the preparatory committee granting approval in principle for the establishment of the people's credit fund and approving the proposed list of candidates for election and appointment as Chairman and other members of the Board of Directors, Head and members of the Supervisory Board, Director of the people's credit fund. In case of non-approval, the SBV branch shall issue a document to the preparatory committee stating the reasons.

Additionally, Circular 21/2019/TT-NHNN also stipulates that the operational area of a people's credit fund is a commune, a ward, or a commune-level town (hereinafter collectively referred to as a commune). The people's credit fund must ensure that the total deposit amount does not exceed 20 times its equity.

More details can be found in: Circular 21/2019/TT-NHNN effective from January 1, 2020.

Thu Ba

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