Vietnam: Organizations and individuals eligible be granted agricultural and rural development loans by credit institutions

Specifically, according to Clause 1 Article 1 of Decree No. 116/2018/ND-CP of Vietnam’s Government, which amends Clause 2 Article 2 and adds Clause 3 to Article 2 of Decree No. 55/2015/ND-CP, customers granted loans by credit institutions are individuals and legal entities, including:

- Individuals living in rural areas or doing agribusiness or farm owners;

- Legal entities, including:

+ Cooperatives and cooperative alliances in rural areas or those engaged in agriculture business;

+ Enterprises operating in rural areas, except for the following entities: real estate enterprises, mining enterprises, power generation enterprises and enterprises not specified in item (iii) Point b Clause 2 Article 2 of Decree No. 55/2015/ND-CP which are located in industrial zones or export processing zones;

+ Providers of agricultural supplies for agriculture production and enterprises producing, purchasing, processing or consuming agricultural products and byproducts.

When a family household, artel or organization that does not have a legal status takes the loan, its member or authorized representative shall be the borrower.

The authorization must be recorded unless otherwise agreed. Any replacement of the representative must be notified to the other parties in the loan agreement. In case a member takes a loan without authorization of the aforementioned household, artel or organization, he/she will be the sole borrower of the loan.

Family households, artels and organizations not holding a legal status mentioned above include:

- Family households residing in rural areas or doing agribusiness;

- Household businesses in rural areas;

- Artels in rural areas or engaged in agribusiness;

- Sole proprietorships operating in rural areas, except for the following entities: real estate enterprises, mining enterprises, power generation enterprises and enterprises not specified in Point dd Clause 3 Article 2 of Decree No. 55/2015/ND-CP that are located within the industrial zones or export processing zones;

- Sole proprietorships providing agriculture supplies for agricultural production and sole proprietorships manufacturing, purchasing, processing or consuming agricultural products and byproducts.

View relevant provisions at: Decree No. 116/2018/ND-CP of Vietnam’s Government takes effect from October 25, 2018.

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