Decision No. 440/2001/QD-NHNN on lending to workers going abroad for a limited period

Pursuant to …;

On lending to workers going abroad for a limited period

________________________

GOVERNOR OF THE STATE BANK OF VIETNAM

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

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

Pursuant to Decree No. 152/1999/NĐ-CP dated September 20, 1999 of the Government regarding Vietnamese workers and experts going abroad for a limited period;

Pursuant to the guidance of the Prime Minister in Document No. 1113/CP-KRITH dated December 4, 2000 concerning lending to workers going abroad for a limited period;

After reaching consensus with the Ministry of Planning and Investment, the Ministry of Finance, and the Ministry of Labor, Invalids, and Social Affairs;

Pursuant to the proposal of the Director of the Monetary Policy Department,

DECISION:

Article 1. Scope of application

Commercial Banks shall lend in Vietnamese Dong and foreign currency to workers and experts going abroad for a limited period (hereinafter referred to collectively as workers) in the following forms:

1. Through Vietnamese enterprises that have won contracts, subcontracts for joint construction projects, joint ventures, profit-sharing agreements with foreign entities, and investments abroad.

2. Through Vietnamese enterprises permitted to provide labor supply services.

3. According to labor contracts directly signed by individual workers with employers abroad.

Article 2. Applicability

1. Commercial Banks may lend to all subjects who are workers going abroad for a limited period. State-owned Commercial Banks may lend without collateral by assets to workers going abroad for a limited period under policy provisions as stipulated in Clause 3 of this Article.

2. Commercial Banks may lend to workers going abroad for a limited period (whether signing contracts directly or through enterprises specified in Points 1 and 2 of Article 1 of this Decision, whether under policy or not under policy) through households having workers going abroad for a limited period, except in cases where the worker going abroad for a limited period is single, in which case Commercial Banks may lend directly to the worker.

3. Workers going abroad for a limited period who themselves fall under policy include:

- Spouses and children of martyrs;

- War invalids (including those classified as Class B war invalids recognized before December 31, 1993, now called military personnel injured in work-related accidents), persons enjoying policies similar to war invalids, those with a disability rate of 21 percent or more (collectively referred to as war invalids);

- Spouses and children of war invalids;

- Children of Heroes of the People's Armed Forces, Heroes of Labor; children of those engaged in the resistance struggle, those who have contributed to the revolutionary cause and received medals or commendations for their resistance efforts; children of cadres who were active in the revolutionary movement before August 1945;

- Workers belonging to poor households according to the standards set forth in Decision No. 1143/2000/QĐ-LĐTBXH dated November 10, 2000 of the Minister of Labor, Invalids, and Social Affairs on adjusting the poverty standard for the 2001-2005 period..

Article 3. Application of lending regulations

Commercial Banks shall lend to workers going abroad for a limited period in accordance with Decree No. 152/1999/NĐ-CP dated September 20, 1999 of the Government regarding Vietnamese workers and experts going abroad for a limited period, the lending rules of credit institutions for customers issued pursuant to Decision No. 284/2000/QĐ-NHNNI dated August 25, 2000 of the Governor of the State Bank of Vietnam, Decision No. 418/2000/QĐ-NHNNL dated September 21, 2000 of the Governor of the State Bank of Vietnam on the subjects of foreign currency loans by credit institutions, the provisions in this Decision, and other relevant regulatory documents.

Article 4. Sources of lending funds

Commercial Banks shall use their own self-raised capital to lend to workers going abroad for a limited period.

Article 5. Borrowing Objectives

Commercial Banks shall lend necessary expenses and fees to serve the purpose of workers going abroad for a limited period according to the labor contract signed between the worker going abroad for a limited period and the Vietnamese enterprise permitted to send workers abroad or the employer abroad:

1. Workers going abroad for a limited period through labor supply enterprises may borrow to pay for the following costs: deposit money, service fees, round-trip airfare, pre-departure training costs, and other lawful costs serving the purpose of working abroad for a limited period.

2. Workers going abroad for a limited period according to a labor contract directly signed by the worker with the employer abroad may borrow to pay for the following costs: round-trip airfare; pre-departure training costs; other lawful costs serving the purpose of working abroad for a limited period.

3. Workers going abroad for a limited period through enterprises that have won contracts, subcontracts for construction projects, joint ventures, profit-sharing agreements abroad, and investments abroad may borrow to pay for the following costs: round-trip airfare, pre-departure training costs, and other lawful costs serving the purpose of working abroad for a limited period.

Article 6. Guarantee for loans

1. State-owned Commercial Banks shall lend without collateral by assets to workers going abroad for a limited period under policy provisions as stipulated in Clause 3 of Article 2 of this Decision. - For workers going abroad for a limited period not under policy, they must implement security measures for the loan amount by assets in accordance with Decree No. 178/1999/NĐ-CP dated December 29, 1999 of the Government and Circular No. 06/2000/TT-NHNN dated April 4, 2000 of the Governor of the State Bank of Vietnam guiding the implementation of this Decree. The signing and execution of the loan security contract shall be as follows:

- For loans implemented through the household of workers going abroad for a limited period, the loan security contract shall be signed between the representative of the household and the Commercial Bank;

- For direct loans to single workers going abroad for a limited period, the loan security contract shall be signed between the worker and the Commercial Bank or between the person authorized by the worker going abroad for a limited period in accordance with the law and the Commercial Bank.

Loan procedures

Article 7. Procedures for lending

1. Commercial banks shall base their loans on the contracts signed between workers going to work abroad for a limited period and Vietnamese enterprises permitted to send workers to work abroad for a limited period, or foreign employers, in accordance with the provisions of Decree No. 152/1999/NĐ-CP dated September 20, 1999, and the loan application documents stipulated in Article 14 of the Regulation on Loans from Credit Institutions to Customers issued pursuant to Decision No. 284/2000/QĐ-NHNN dated August 25, 2000.

2. The loan application documents for workers going to work abroad for a limited period who themselves do not fall under policy categories include:

a. Documents proving that the borrower is the head of the household of the worker going to work abroad for a limited period, in compliance with the law;

b. A loan application from the head of the household or from the worker going to work abroad for a limited period (in cases where the worker is single);

c. The contract signed between the worker going to work abroad for a limited period and Vietnamese enterprises permitted to send workers to work abroad for a limited period, or foreign employers;

d. A loan guarantee contract;

đ. Other necessary documents proving eligibility for the loan.

3. The loan application documents for workers going to work abroad for a limited period who themselves fall under policy categories include:

a. Documents proving that the worker going to work abroad for a limited period falls under policy categories as specified in Clause 3, Article 2 of this Decision;

b. The types of documents as specified in Clause 2 of this Article, except for the loan guarantee contract.

Article 8. Loan amount

Commercial banks shall base their loan decisions on the loan needs of workers going to work abroad for a limited period as stipulated in Article 5 of this Decision, the value of collateral (for workers going to work abroad for a limited period who themselves do not fall under policy categories), the ability of the household or the worker to repay the debt, and their own capital availability.

Article 9. Interest Rate for Loans

The loan interest rate shall be implemented according to the agreement between the commercial bank and the borrowing customer in compliance with the regulations of the Governor of the State Bank of Vietnam during each period.

Article 10. Loan term

Commercial banks shall base their loan terms on the income and debt repayment capacity of the borrowing customer and their own capital availability, but such terms shall not exceed the duration of the contract for working abroad signed between the worker and Vietnamese enterprises permitted to send workers to work abroad for a limited period, or foreign employers.

Article 11. Repayment of loans

Commercial banks, households with workers going to work abroad for a limited period, or workers may agree on the repayment periods for the loan. In cases where Vietnamese enterprises permitted to send workers to work abroad for a limited period manage the income of the worker paid by the foreign side, the commercial bank, the worker, and the Vietnamese enterprise may agree that the Vietnamese enterprise will directly repay the loan to the commercial bank from the worker's income.

Article 12. Implementation

1. This Decision takes effect fifteen days after its date of signature.

2. The Board of Directors and General Director (Director) of Commercial Banks are responsible for guiding the implementation of this Decision.

3. Heads of units under the State Bank of Vietnam, Directors of Provincial Branches of the State Bank of Vietnam, and Directors of Municipal Branches of the State Bank of Vietnam directly under the Central Government are responsible for inspecting, supervising, and monitoring Commercial Banks and borrowing customers in implementing this Decision according to their functions and tasks./.