Procedure for the loan guarantee proposal for projects in Vietnam as per Circular 06

Procedure for the loan guarantee proposal for projects in Vietnam as per Circular 06 (illustrative image)

According to Circular 06/2011/TT-BKHCN which regulates the loan guarantee proposal procedure for plans for economical and efficient use of energy for small and medium-sized enterprises as follows:

1. Application for Loan Guarantee Proposal

- Loan Guarantee Proposal Letter from the SME or Energy Efficiency Service Provider.- Documents proving that the applicant meets the conditions for a guarantee under the provisions of Article 9 of this Circular.- Other documents as required by the Guarantor.

2. Loan Guarantee Process

- When there is a need for a loan guarantee for a project utilizing energy efficiently, the applicant shall send a application to the National Science and Technology Development Fund (NSTDF).

- No later than 30 days from the receipt of the complete application, the NSTDF and the Guarantor shall appraise the technical and financial aspects of the project and the customer. In case of approval, the NSTDF shall notify the applicant and the Guarantor in writing. In case of disapproval, the NSTDF shall notify the applicant and explain the reasons for such disapproval.

- Based on the approval notice from the NSTDF, the Guarantor shall send a document to the Loan Receiver to facilitate the signing of the credit contract with the customer.

- After the credit contract is signed between the Loan Receiver and the Guaranteed Party, the Guarantor shall sign a loan guarantee contract and a guarantee assurance contract with the Guaranteed Party and issue a guarantee certificate to the Loan Receiver.

- The Loan Receiver shall proceed to lend to the Guaranteed Party according to the current regulations of the State Bank of Vietnam regarding the lending mechanism of commercial banks to customers.

More details can be found in Circular 06/2011/TT-BKHCN, effective from July 1, 2011.

Thuy Tram

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