Transparent and strict regulations on special loan conditions with 0% interest rate
The draft Law on Credit Institutions (amended) has added an important provision: the authority to decide on special lending for loans without collateral and with an interest rate of 0%/year will be transferred from the Prime Minister to the State Bank of Vietnam (SBV).
The Standing Committee of the Economic and Financial Committee expressed its agreement with this adjustment to ensure proactiveness and flexibility in handling special situations.
Previously, many opinions in the review report of the Economic and Financial Committee and National Assembly deputies emphasized the need to review current regulations on special loans. Specifically, it is necessary to clarify the criteria and conditions for loans with 0% interest rate and no collateral, and at the same time require specific and transparent regulations on the procedures for borrowing capital, as well as mechanisms to control risks and limit losses.
In response to these recommendations, in Report No. 481, the Government proposed that after the Law is promulgated, the SBV will preside over a comprehensive review of the criteria and conditions for special loans, clearly defining the purpose of the loan, the borrower's responsibilities as well as the SBV's obligation to control cash flow. These contents will be specified in the process of amending and supplementing Circular No. 37/2024/TT-NHNN.
The Standing Committee of the Economic and Financial Committee agreed with the Government's plan and suggested that it is necessary to continue directing the State Bank to complete the legal framework on special lending. The goal is to prevent moral hazard, avoid policy abuse, and not let special support become a barrier to internal restructuring efforts of credit institutions. At the same time, the promulgation of regulations must ensure transparency and fairness in the market, contributing to strengthening social trust in special credit policies.
The state budget does not have to compensate.
At the meeting of the National Assembly Standing Committee on the morning of June 10, Governor of the State Bank of Vietnam (SBV) Nguyen Thi Hong clarified the content related to special loans with 0% interest rate. According to Ms. Hong, the capital for special loans is used by the SBV from the function of issuing money - one of the core tasks of the central bank - and not from the state budget. Therefore, applying a 0% interest rate to special loans does not create the risk of having to compensate from the budget.
However, the State Bank is still reviewing regulations related to handling special loans within the framework of the current financial regime.
The Governor also stated that the special lending method is only applied in two specific cases: First, when a credit institution is in a state of mass withdrawal to ensure its ability to pay depositors. Second, when implementing a recovery plan or compulsory transfer for a credit institution under special control. This method is only used after other operational measures such as recapitalization or open market have been applied.
“Special lending is a necessary measure to prevent mass withdrawals from credit institutions, limit the risk of spreading risks in the system, and support restructuring plans for weak credit institutions. The core objective is to ensure safety for the system, not to create a competitive advantage for institutions that receive special loans,” the Governor emphasized.
In addition, the SBV is also considering amending Circular 37/2024/TT-NHNN to clarify the criteria and conditions for special loans with 0% interest rates and no collateral requirements. The amended Circular will clearly stipulate the purpose of the loan, the responsibilities of the borrower and the SBV, as well as the cash flow control mechanism to prevent risks, avoid policy abuse and minimize possible losses.
Clarifying regulations on 0% interest rate for special loans
The Draft Law currently stipulates in Clause 1, Article 1 that: "The special lending interest rate of the State Bank of Vietnam (SBV) is 0%/year." However, this provision has given rise to many different opinions on its suitability and scope of application.
In the Preliminary Review Report No. 257/BC-UBKTTC15 dated April 23, 2025, the Standing Committee of the Economic and Financial Committee stated: The regulation of an interest rate of 0%/year for all special loans from the State Bank is different from current regulations, so it is necessary to assess the specific impact. Some opinions suggested considering the uniform application of this interest rate, because each credit institution (CI) being processed has different characteristics and risk levels.
There is a view that it is necessary to maintain the provisions in the current Law on Credit Institutions, according to which the State Bank can decide to grant special loans with different interest rates, depending on whether the loan has collateral or not. In case of necessity, the lowest interest rate can be 0%/year, and the specific determination should be decided by the Governor of the State Bank.
The Standing Committee of the Party Committee of the State Bank of Vietnam presented this content in Submission No. 04-TTr/ĐUNHNN dated April 29, 2025, asking for opinions from competent authorities on the regulation of the 0%/year interest rate. By May 16, 2025, competent authorities had met to give opinions, but there was no official conclusion document. Therefore, in the Official Review Report No. 408/BC-UBKTTC15 dated May 19, 2025, this content was not mentioned again, and the Economic and Financial Committee requested the drafting agency to continue reviewing and completing the draft in accordance with the final directive.
Subsequently, the Central Party Office issued Official Dispatch No. 14923-CV/VPTW dated May 20, 2025, conveying the conclusion of the competent authority. However, this document did not clearly state its agreement with the proposal to apply a 0% interest rate per year to all special loans, nor did it mention the abolition of interest-bearing loans under the Law on Credit Institutions 2024 (Clause 1, Article 193).
During the process of finalizing the draft, the drafting agency still maintained its position of proposing to stipulate an interest rate of 0%/year as in the draft submitted to the National Assembly. Some opinions agreed, saying that this provision is necessary to facilitate the recovery of credit institutions under special control, forced to transfer - which are seriously negative in equity and cannot restructure themselves.
However, there are also opinions affirming that the restructuring plans of weak credit institutions, including the content of special loans, must always be considered and decided by competent authorities before implementation. Therefore, keeping the provisions as in the current Law - only determining the authority to decide on loans, not stipulating a fixed interest rate - is appropriate.
The Standing Committee of the Economic and Financial Committee stated that the regulation on special lending interest rates of the State Bank is an important issue, directly affecting the stability of the financial and banking system, national monetary security and economic resources. Due to different interpretations among agencies, on June 5, 2025, the Committee issued Official Dispatch No. 29/UBKTTC15-m to the Standing Committee of the Law and Justice Committee to synthesize and report to the Standing Committee of the National Assembly Party Committee for final conclusions.
At the meeting of the National Assembly Standing Committee on the morning of June 10, 2025, Governor of the State Bank of Vietnam Nguyen Thi Hong requested the National Assembly Standing Committee to report and seek opinions from competent authorities as a basis for perfecting regulations on special lending interest rates in the draft Law.
Source: https://baodaknong.vn/thong-doc-nhnn-ngan-sach-khong-dung-de-bu-lai-suat-cho-khoan-vay-dac-biet-0-255229.html
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