Vietnam: Procedures for grant of credit guarantee

According to Decree No. 34/2018/ND-CP of Vietnam’s Government, in order to be granted with credit guarantee, the beneficiary of the guarantee shall prepare the application documents for the offer of credit guarantee.

The application documents for the offer of credit guarantee include:

- Application form for the offer of credit guarantee prepared by the obligor.

- Documentary evidence that proves that the obligor has fulfilled all necessary requirements for the credit guarantee under provisions and other relevant documents stipulated by the credit guarantee fund.

- SMEs submit applications for credit guarantee to the credit guarantee fund in person in the same administrative division (where they register their business and are headquartered) or by post.

- The Director of credit guarantee fund shall request the President of credit guarantee fund to issue specific regulations on required documents in the application for offer of credit guarantees.

After receiving the dossier from the obligor, the guarantor will proceed with the assessment of the application and decide on the grant of the credit guarantee. This process shall be carried out as follows:

- The guarantor shall be responsible for verifying if required documents in the application sent by the obligor are adequate; assessing efficiency and effectiveness, and loan repayment competence of investment projects, production and business plans and other guarantee conditions.

- The guarantor shall be responsible for formulating the process for assessing the efficiency and effectiveness, and loan repayment competence of investment projects, production and business plans submitted by the obligor, who sticks to the principles that the autonomy, sole and joint responsibility of persons concerned at the stage of credit guarantee assessment and decision must be respected.

- No later than 30 days since valid application documents for the offer of credit guarantee were fully received, the guarantor must complete the consideration process for granting the credit guarantee to the obligor. The decision to grant the credit guarantee to the obligor shall be documented in the form of a guarantee contract between the guarantor, the obligee and the obligor. Where the application for the offer of credit guarantee is rejected, the guarantor must send a written notification to the applicant in which reasons for such rejection must be clearly stated.

Decree No. 34/2018/ND-CP of Vietnam’s Government takes effect from March 08, 2018.

-Thao Uyen-

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