On June 5, 2023, the Prime Minister issued Decision No. 17/2023/QD-TTg (“Decision 17”) amending and supplementing a number of articles of Decision No. 31/2007/QD-TTg dated March 5, 2007, on credit for production and business households in disadvantaged areas (“Decision 31”) and Decision No. 92/2009/QD-TTg dated July 8, 2009, on credit for traders conducting commercial activities in disadvantaged areas (“Decision 92”). Accordingly, ATA Legal Services has summarized the following notable contents:
1. Clarifying the concept of difficult areas
Clause 1, Article 2 of Decision 17/2023/QD-TTg amending Article 2 of Decision 31/2007/QD-TTg stipulates that disadvantaged areas include the following areas:
- Communes, wards, and townships are specified in the List of commune-level administrative units in disadvantaged areas.
- The island districts do not have commune-level administrative units but belong to the list of communes with special difficulties in the lowlands, coastal areas, and islands.
- The villages are not in the communes in difficult areas but on the List of villages with special difficulties in ethnic minority and mountainous areas.
2. Supplementing the conditions for production and business households to borrow capital under this policy (In addition to Articles 3 and 4 to Decision 31)
(i) Not being classified as poor households, near-poor households, and households escaping poverty under the Prime Minister's Decision (Decision 92 only requires not being poor households);
(ii) There is no outstanding balance at the Bank for Social Policies for the following programs:
- Loan program to support employment, job retention, and expansion;
- Program on investment loans, support for the development of areas growing precious medicinal herbs;
- Other credit and loan programs for households to carry out production and business activities (if any).
3. Increasing the fund amount for loans, reducing the loan interest rate, and do not require loan collateral for households in disadvantaged areas
|
Criteria |
Decision 31 |
Decision 17 |
|
Fund amount for the loan |
The maximum is 50 million VND. Fund amount for loans higher than 50 million but not more than 100 million and only applied when the household meets certain conditions |
The maximum amount is VND 100 million applied to all borrowers |
|
Interest rates |
0,9%/month |
9%/year, equivalent to 0.75%/month |
|
Loan collateral |
Required for loans with a value of over VND 50 million or more |
No collateral is required for all loans |
4. Increasing loan capital and reducing loan collateral requirements for traders in disadvantaged areas
|
Criteria |
Decision 92 |
Decision 17 |
|
Fund amount for the loan |
- Traders that are individuals who do not open books and pay flat tax: maximum of 30 million VND; - Traders and individuals open books and declare and pay tax: maximum of 100 million VND; - Traders that are organizations: 500 million VND |
- Traders that are individuals: maximum of 100 million VND; - Traders that are organizations: 1 billion VND |
|
Loan collateral |
Required for loans valued at over VND 50 million or more. |
Only required for loans over 100 million VND or more. |
Decision 17 takes effect from August 8, 2023. Credit contracts signed before the effective date of Decision 17 will continue to perform under the signed contracts until the end of the contract, even if the borrower is no longer in a difficult area according to the provisions of this Decree. new regulations.
Comment: