Decision No. 1234/2001/QD-NHNN on the issuance of the Regulation on lending applicable to students of universities, colleges, vocational high schools, and vocational training institutions.

DECISION OF THE GOVERNOR OF THE STATE BANK OF VIETNAM

Regarding the issuance of the Lending Regulations applicable to students at universities, colleges, vocational high schools, and vocational training institutions

GOVERNOR OF THE STATE BANK OF VIETNAM

- Based on the Law on the State Bank of Vietnam and the Law on Credit Institutions dated December 12, 1997;

- Based on Decree No. 15/CP dated March 2, 1993 of the Government on the tasks, powers, and responsibilities for management of ministries and ministerial-level agencies;

- Based on Decision No. 51/1998/QĐ-TTg dated March 2, 1998 of the Prime Minister on establishing the Education Credit Fund;

- In accordance with the proposal of the Director of the Monetary Policy Department,

Pursuant to …;

Article 1. The Lending Regulations applicable to students at universities, colleges, vocational high schools, and vocational training institutions are hereby issued along with this Decision.

Article 2. This Decision takes effect from October 1, 2001, replacing Decision No. 219/1998/QĐ-NHNN1 dated July 1, 1998 of the Governor of the State Bank of Vietnam on the issuance of the Credit Regulations for students at universities, colleges, vocational high schools, and vocational training institutions.

Article 3. Heads of units under the State Bank of Vietnam, Directors of provincial and centrally-administered city branches of the State Bank of Vietnam; Chairmen of the Board of Directors and General Directors of commercial banks or policy banks assigned the task of lending to students are responsible for implementing this Decision.

REGULATIONS ON LENDING APPLICABLE TO STUDENTS
AT UNIVERSITIES, COLLEGES, VOCATIONAL HIGH SCHOOLS AND VOCATIONAL TRAINING INSTITUTIONS

(Issued together with Decision No. 1234/2001/QĐ-NHNN dated September 26, 2001 of the Governor of the State Bank of Vietnam)
These regulations govern lending in Vietnamese Dong by commercial banks or policy banks assigned the task of lending to students at universities, colleges, vocational high schools, and vocational training institutions from the Education Credit Fund established pursuant to Decision No. 51/1998/QĐ-TTg dated March 2, 1998 of the Prime Minister.

Article 1. Scope of Application

1. Abbreviations used in these regulations:

Article 2. Definitions

- Students are abbreviated as

students - Universities, colleges, vocational high schools, and vocational training institutions are abbreviated as.

institutions - Commercial banks or policy banks assigned the task of lending to students are abbreviated as.

- Parents or legal guardians of students who commit to repaying the loan in the Loan Application Form are abbreviated as Banks. 

guarantors The period from when a student receives the first loan until the date when all principal and interest due under the credit agreement have been fully repaid..

2. The term of lending is Loan term

3. refers to the periods within the loan repayment period specified in the credit agreement during which the student must repay part or all of the loan amount at the end of each period. là các giai đoạn trong kỳ hạn trả nợ được ghi trong hợp đồng tín dụng mà tại cuối mỗi giai đoạn đó, học sinh phải trả một phần hoặc toàn bộ số tiền vay.

4. Adjustment of debt repayment terms is the act of the Bank's approval for students to change the previously recorded debt repayment periods in the credit contract.

5. Extension of loan period is the act of the Bank's approval to extend an additional period beyond the loan term already recorded in the credit contract.

6. End date of the academic program is the point in time when the student completes the graduation examination or successfully defends their graduation thesis.

Article 3. Borrowing student subjects

1. Regular full-time students enrolled at public, semi-public, or private universities, colleges, vocational high schools, and technical schools with a training duration of one year or more, and borrowing in the first academic year based on the semester 1 academic performance points, and from the second academic year onwards based on the academic performance points achieved in the immediately preceding academic year as follows:

1. Supplementing Point 6a following Article 6 of Circular No. 02/2019/TT-BVHTTDL dated July 5, 2019 of the Minister of Culture, Sports and Tourism on the procedures for legal expertise regarding copyright and related rights as follows: For students under policy provisions as stipulated in Point 1, Section I of Circular Joint Circular No. 26/1999/TTLT-BLDTBXH-BGDĐT dated November 2, 1999, and students who are poor or belong to poor households according to standards prescribed in Decision No. 1143/2000/QD-LDTBXH dated November 10, 2000 of the Ministry of Labor, Invalids, and Social Affairs; non-policy students with permanent residence registration before enrollment in Zone 1: Achieve an expanded average grade point of 5.0 or higher:

b. For non-policy students with permanent residence registration in Zone 2 before enrollment: Achieve an expanded average grade point of 6.0 or higher.

c. For non-policy students with permanent residence registration in Zone 3 before enrollment: Achieve an expanded average grade point of 7.0 or higher.

The provisions regarding students in Zones 1, 2, and 3 shall be implemented in accordance with the Admissions Regulations issued by the Minister of Education and Training pursuant to Decision No. 05/1999/QD-BGDĐT dated February 23, 1999.

2For students currently studying at institutions and have borrowed from the Education Training Credit Fund but face difficult circumstances preventing them from continuing their studies, upon approval by the school's management board to take a leave of absence for a specified period and retain their academic standing to resume studies later, the study period at the institution includes the approved leave period. When the student resumes studies, the loan will be based on the academic performance of the last academic year before taking the leave.

Article 4. Loan Conditions

Students must meet the following conditions:

1. Belong to the subject categories as prescribed in Article 3 of this Regulation.

2. The purpose of using the borrowed funds is to cover educational expenses during the period of study at the institutions.

3. The representative of the student's family or the legally recognized guardian in Vietnam commits in the student's loan application form about the responsibility to repay the debt on behalf of the student in case the student transfers schools, drops out, is removed from the student list, or fails to repay the principal and interest of the loan within the due period or does not fully repay the debt at the final repayment deadline after completing the course at the institutions.

Article 5. Borrowing Objectives

It refers to the costs of purchasing textbooks, learning materials, research tools, and other expenses serving the student's education during the study period at the institution.

Article 6. Loan Amount

The loan amount for students provided by the Bank shall be determined based on each student's funding needs, but shall not exceed 200,000 VND per student per month.

Article 7. Loan term

The loan term includes the grace period and the repayment period:

1. The grace period is the timeframe from the day the student receives the first loan until the end of the academic program, including the period during which the student is allowed by the institution to take a leave of absence and retain their academic standing (if applicable).

2. The repayment period is calculated based on the number of years the Bank provides loans to the student during their study period at the institution.

Article 8. Interest Rate for Loans

1. The loan interest rate for students is lower than the usual loan interest rate of commercial banks during the same period. The specific interest rate is announced by the Governor of the State Bank of Vietnam based on consensus with the Minister of Education and Training.

2. The overdue interest rate is 120% of the loan interest rate recorded in the credit contract.

Article 9Loan Application Documents

1. Students prepare a loan application form according to the pre-printed template of the Bank. This form is prepared only once and used throughout the entire academic program, submitted to the Bank upon the initial loan application, including the following elements:

- Commitment of the representative of the student's family or the legally recognized guardian in Vietnam regarding the responsibility to repay the debt on behalf of the student in case the student transfers schools, drops out, is removed from the student list, or fails to repay the principal and interest of the loan within the due period or does not fully repay the debt at the final repayment deadline after completing the course at the institutions.

- Confirmation by the People's Committee of the commune, ward, or town where the representative of the student's family or the legally recognized guardian in Vietnam has permanent residence regarding the address, signature of the representative of the student's family or the legally recognized guardian in the loan application form being correct and the family's financial situation being insufficient to cover the student's educational expenses, thus necessitating a loan.

- Confirmation by the school's management board or a person authorized by the management board that the student belongs to the category eligible for consideration for a loan as prescribed in Article 3 of this Regulation.

2. In cases where students fall under policy provisions, they must provide a copy of the confirmation letter issued by the competent state agency, confirmed by the schools, extracted from the student's file kept at the school.

3. Students and the Bank sign a credit contract at the initial loan application, valid for the entire academic program.

4. Students prepare a commitment letter to repay the principal and interest of the loan after completing the academic program.

Article 10. Procedure for examination and lending

The procedure for providing loans to students shall be carried out as follows:

1. At the beginning of each academic year, students eligible for loans shall register for loans with their schools.

2. Schools shall verify and prepare a list of eligible students for loan submission to the Bank; simultaneously, they shall distribute pre-printed Loan Application Forms provided by the Bank for students to complete all required contents and elements as stipulated in Clause 1, Article 9 of this Regulation.

3. Students shall submit the Loan Application Form to the Bank; in cases where students belong to policy groups, they must also attach a Confirmation Letter from the relevant state agency as specified in Clause 2, Article 9 of this Regulation.

4. If the Bank approves the loan, it shall enter into a credit agreement with the student; if the loan is not approved, the Bank must notify the schools and students in writing, clearly stating the reasons for the rejection.

Article 11. Repayment of principal and interest on the loan

1. During the period of study at the schools, students are not required to repay the principal and interest on the loan; interest on the loan shall be calculated from the day following the completion of the course until the full repayment of the principal.

2. Students must make their first repayment of the principal and interest on the loan within six months from the date of completing the course.

3. In cases where students transfer schools, withdraw from school, have their names removed from the student list, or fail to repay the loan according to the due date or do not fully repay the loan by the final repayment date after completing the course at the schools, the guarantor of repayment must fulfill the obligation to repay.

4. Interest on the loan shall be calculated according to the method prescribed in Clause 2, Article 10 of the Decision No. 652/2001/QĐ-NHNN dated May 17, 2001 of the Governor of the State Bank of Vietnam regarding the method of calculating interest and accounting for income and expenditure of interest by the State Bank and credit organizations.

Article 12. Extension of loan term, adjustment of repayment period        

1. When the repayment period specified in the credit agreement arrives, if the student or guarantor of repayment is unable to fully repay the principal and interest on the loan due to objective reasons, the student or guarantor of repayment must submit a Request for Adjustment of Repayment Period to the Bank for consideration of adjusting the repayment period; if the repayment period is not adjusted, the Bank will transfer the outstanding loan to overdue debt.

2. Upon reaching the final repayment date specified in the credit agreement, if the student is unable to fully repay the debt due to objective reasons and the guarantor of repayment is also unable to repay the debt, the student or guarantor of repayment must submit a Request for Extension of Debt to the Bank; the Bank will consider granting an extension of up to two years, starting from the final repayment date; if the extension is not granted, the Bank will transfer the outstanding loan to overdue debt.

3. Requests for adjustment of the repayment period and extension of debt by students or guarantors of repayment and the Bank's resolution thereof must be completed before the repayment deadline.

Article 13. Reduction of interest rate on the loan

1. Students who fully repay the principal and interest on the loan before the final repayment date specified in the credit agreement shall have their remaining interest reduced as follows:

1. Supplementing Point 6a following Article 6 of Circular No. 02/2019/TT-BVHTTDL dated July 5, 2019 of the Minister of Culture, Sports and Tourism on the procedures for legal expertise regarding copyright and related rights as follows: Early repayment of four years or more shall result in a 30% reduction.

b. Early repayment of three years to less than four years shall result in a 20% reduction.

c. Early repayment of two years to less than three years shall result in a 15% reduction.

d. Early repayment of one year to less than two years shall result in a 10% reduction.

) Vehicle registration certificate or certificate of vehicle deregistration or export certificate or ownership certificate of the vehicle issued by the competent authority of the exporting country or other documents of equivalent legal value: one certified Vietnamese translation from the original for cases of temporary import of movable property vehicles; Early repayment of less than one year shall result in a 5% reduction.

2. For students who suffer property losses due to objective reasons and whose families face economic difficulties, upon completion of the course or after the family's residence has been confirmed by the People's Committee of the commune, ward, or town where the student resides, only able to repay the principal and part of the interest, the Bank may consider reducing the interest on the loan for such students, with a maximum reduction of 50% of the remaining interest.

3. The Bank shall waive interest on the loan for students who encounter risks due to objective reasons as stipulated by the Ministry of Finance regarding the financial management system for the Education Credit Fund.

Article 14. Rights and obligations of the Bank

1. The Bank has the right to:

1. Supplementing Point 6a following Article 6 of Circular No. 02/2019/TT-BVHTTDL dated July 5, 2019 of the Minister of Culture, Sports and Tourism on the procedures for legal expertise regarding copyright and related rights as follows: Require students and guarantors of repayment to provide complete information related to the loan and repayment of the student.

b. Refuse loan requests from students who do not meet the loan conditions or when the Education Credit Fund does not have sufficient funds to lend.

c. Terminate the loan, recover the debt before the due date in cases where the student provides false information, violates the credit agreement; the student transfers schools, withdraws from school, or is removed from the student list by the school.

d. Initiate legal action against students who violate the credit agreement or guarantors of repayment who fail to fulfill their guarantee obligations as stipulated by law.

) Vehicle registration certificate or certificate of vehicle deregistration or export certificate or ownership certificate of the vehicle issued by the competent authority of the exporting country or other documents of equivalent legal value: one certified Vietnamese translation from the original for cases of temporary import of movable property vehicles; Reduce interest, adjust the repayment period, extend the loan term in accordance with the provisions of this Regulation.

e. Send notifications to guarantors of repayment and the unit where the student works after completing the course to urge repayment.

2. The Bank has the obligation to:

1. Supplementing Point 6a following Article 6 of Circular No. 02/2019/TT-BVHTTDL dated July 5, 2019 of the Minister of Culture, Sports and Tourism on the procedures for legal expertise regarding copyright and related rights as follows: Fulfill the agreements in the credit agreement.

b. Maintain credit files in compliance with legal regulations.

Article 15. Rights and obligations of students

1. Students have the right to:

1. Supplementing Point 6a following Article 6 of Circular No. 02/2019/TT-BVHTTDL dated July 5, 2019 of the Minister of Culture, Sports and Tourism on the procedures for legal expertise regarding copyright and related rights as follows: Refuse requests from the Bank that do not comply with this Regulation and commitments in the credit agreement.

b. Lodge complaints or initiate legal actions against violations of the credit agreement as stipulated by law.

2. Students have the obligation to:

1. Supplementing Point 6a following Article 6 of Circular No. 02/2019/TT-BVHTTDL dated July 5, 2019 of the Minister of Culture, Sports and Tourism on the procedures for legal expertise regarding copyright and related rights as follows: Provide complete and truthful information and documents related to the loan and promptly inform the Bank of any changes in place of residence or employment after completing the course; bear responsibility for the accuracy of the information and documents provided.

b. Use the loan for its intended purpose and fulfill all commitments in the credit agreement and the Debt Repayment Commitment Letter.

c. Within ten days of completing the course, students who still owe loans must go to the Bank to make a Debt Repayment Commitment Letter, indicating their contact address and payment method for debt repayment, and submit this letter to the schools to process graduation certificate issuance.

d. Shall bear legal responsibility for failing to fulfill commitments regarding principal and interest loan repayments.

Article 16. Responsibilities of the person committing to repay on behalf of others

1. Committing to repay on behalf of students as stipulated in Clause 1, Article 9 of this Regulation.

2. Repaying the principal and interest of the loan on behalf of the student in cases where the student fails to repay within the due period; the student transfers to another school, withdraws from studies, or is removed from the list of students required to repay debts prematurely but lacks the ability to repay.

3. Provide accurate information about the circumstances, place of residence, and workplace of the student after completing the course to the Bank.

4. Send a request for debt extension or adjustment of the repayment term to the Bank on behalf of the student when the student cannot repay at the due date due to objective reasons and has not submitted a request to the Bank.

Article 17. Responsibilities of the schools

1. Confirm in the Student Loan Application Form as prescribed in Clause 1, Article 9 of this Regulation.

2. Compile and submit to the Bank a list of students eligible for loans and be responsible for the accuracy and correctness of this list.

3. Timely, accurately, and fully inform the Bank of lists of students transferring schools, withdrawing from studies, being disciplined, removed from the list, suspended, or expelled.

4. Cooperate with the Bank in monitoring the borrowing and usage of borrowed funds by students.

5. Notify the Bank of the completion time of the final examination or thesis defense of the student to serve as a benchmark for the Bank to calculate interest on the loan according to Clause 6, Article 2 and Clause 1, Article 11 of this Regulation.

6. Require students who still owe loans to submit a Debt Repayment Commitment Letter confirmed by the Bank before issuing the graduation certificate and returning the file to the student.

7. Require students who still owe loans to the Bank to repay all outstanding loans in cases of transferring schools, withdrawing from studies, or being removed from the list of students.

Article 18. Responsibilities of the People's Committees at commune, ward, town level    

1. Confirm in the Student Loan Application Form as prescribed in Clause 1, Article 9 of this Regulation.

2. Urge repayment and take administrative measures against students, persons committing to repay on behalf of others upon receipt of a Bank's request regarding non-payment by the due date.

3. Inform the Bank of changes in the place of residence and new workplace of the student and the person committing to repay on behalf of others.

Article 19. Implementation

1. The Bank assigned the task of lending to students based on the provisions of the Civil Code, Law on Credit Institutions, and this Regulation shall prepare printed forms of the Student Loan Application Form, Credit Contract, and Debt Repayment Commitment Letter for students to process loan procedures.

2. The Bank assigned the task of lending to students, students taking out loans, persons committing to repay on behalf of students, schools, People's Committees of communes, wards, towns have the responsibility to implement the provisions of this Regulation.

3. Heads of units under the State Bank, Directors of provincial and municipal branches of the State Bank are responsible for inspecting, supervising, and monitoring Banks assigned the task of lending to students according to their assigned functions and tasks.

4. Amendments and supplements to this Regulation shall be decided by the Governor of the State Bank.