Conditions for commencement of operation of microfinance institutions in Vietnam

09:50, 23/03/2018

On February 23, 2018, the State Bank of Vietnam issued Circular No. 03/2018/TT-NHNN, which specifies conditions for commencement of operation of microfinance institutions (MFIs).

According to Circular No. 03/2018/TT-NHNN of the State Bank of Vietnam, a licensed MFI may only commence its operation if it meets all the following conditions:

- Its charter has been issued and sent to the State Bank;

- It has obtained a business registration certificate;

- It has sufficient charter capital as prescribed in this Circular. The charter capital in Vietnamese dong must be fully deposited into the blocked account without interest at the operations center of the State Bank at least 30 days prior to the commencement of operation, minus the stake equal to the real value of funds allocated under the microfinance program/project. The charter capital’s account is unlocked when the MFI has commenced operation;

- Its headquarters fully meets the conditions for ensuring the property safety and compatibility with the operation requirements of the MFI;

- It has an organizational structure, an executive apparatus, an internal audit, a risk management unit and an internal control system in accordance with the law on MFIs;

- Internal regulations prescribed in Clause 2 Article 93 of the Law on credit institutions, regulations on organization and operation of council of members, control board, general director (director) of MFI;

- It has disclosed information as prescribed by law.

View more details at Circular No. 03/2018/TT-NHNN of the State Bank of Vietnam, effective from April 15, 2018.

-Thao Uyen-

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