Facilitate enterprises to access foreign capital

	Foreign capital poured into many Southeast provinces at the beginning of the year
	Many factors support foreign capital flow
	Attract foreign capital into the stock market

Conditions for foreign capital loans have become more favourable, in line with the requirements of the current market. Photo: ST

In 2014, Circular 12/2014/TT-NHNN on conditions for foreign loans of enterprises not guaranteed by the Government (Circular 12) of the State Bank (SBV) was implemented. Experts say that Circular 12 has set out a management framework for foreign loan conditions for businesses without government guarantees, consistent with the economic context.

However, after more than 9 years of implementation, self-borrowing and self-payment of foreign loans have been greatly affected by fluctuations in the international financial market. Many experts believe adjusting regulations on foreign loan conditions is necessary for the recent complicated and invisible domestic and international economic chaos. Therefore, Circular 08/2023/TT-NHNN (Circular 08) regulating foreign loans not guaranteed by the Government was issued on June 30, 2023, with the spirit of focusing on solving problems arising during the implementation of Circular 12 has created favourable conditions for businesses when making foreign loans.

Accordingly, Circular 08 stipulates that the subjects to apply regulations on conditions for foreign loans not guaranteed by the Government include residents being enterprises, cooperatives, unions of cooperatives, credit institutions and foreign bank branches established, doing business in Vietnam are foreign borrowers (borrowers); credit institutions, foreign bank branches in Vietnam - where the borrower opens accounts for foreign loans and repayments (account service providers).

Circular 08 also stipulates that foreign borrowers in the form of import of goods with deferred payment are not required to comply with the conditions for foreign loans specified in this Circular. Regarding the principle of using foreign loans, Circular 08 stipulates that the borrower is fully responsible for using foreign loans for the right purposes. If the loan has been withdrawn but temporarily not used for lawful foreign borrowing purposes, the borrower can deposit this money source at credit institutions or foreign bank branches operating in Vietnam. However, the maximum term of each deposit cannot exceed 1 month.

Ms Hoang Thi Huyen Trang, Deputy Head of the Foreign Borrowing and Lending Management Department, Foreign Exchange Management Department (SBV), emphasized that compared to Circular 12, Circular 08 has facilitated businesses most in implementing foreign loans such as no requirement to compare loan costs when restructuring foreign debt; Do not require foreign loans in the form of imported goods on deferred payment to comply with loan conditions; Supplementing regulations on loan using plans and loan structure plans, calculating exchange rate loan limit...

In addition, Circular 08 does not change the management method for short-term and medium- and long-term foreign loans; Reduces 01 administrative procedure related to approval of foreign loans in Vietnam Dong and does not give rise to any additional administrative procedures compared to Circular 12. Stipulating foreign loan conditions in the Circular supports businesses in mobilizing foreign loans for production and business within a reasonable range and ensuring national foreign debt safety norms.

The State Bank said that recently, the State Bank has urgently issued many legal documents, including documents on foreign exchange management, to create a complete legal framework, closely following the market, ensuring safe and effective foreign exchange management. During the implementation of these documents, the SBV, as well as relevant state management agencies, will strengthen the inspection and examination of activities of credit institutions and businesses related to foreign currency activities.

Therefore, as an organization providing account services to customers and foreign borrowers, credit institutions are recommended to increase their responsibility in properly grasping regulations and building uniform deployment processes throughout the system, disseminating and guiding customers to understand and comply with regulations on foreign exchange management in general and regulations on self-borrowing and self-repayment of foreign loans in particular.

The representative of the Foreign Exchange Management Department requested credit institutions to enhance the responsibility of banks providing account services when performing payment and money transfer operations in current and capital transactions, document collections and records in providing account services, serving the inspection process of management agencies; guiding customers to comply with regulations on foreign exchange management, conducting money transfer transactions following regulations.