New regulation on bank loans under 100 million VND in Vietnam

On June 28, 2024, the State Bank of Vietnam issued Circular 12/2024/TT-NHNN, amending the regulations on lending activities of credit institutions and foreign bank branches for customers. A notable change is the regulation that bank loans under 100 million VND no longer require a mandatory capital usage plan.

According to Circular 12/2024/TT-NHNN, the current conditions for borrowing from credit institutions are:

Being a legal entity with civil legal capacity as prescribed by law;
Being at least 18 years old with full civil act capacity as prescribed by law or being from 15 to under 18 years old without losing or limiting civil act capacity as prescribed by law;
The need to borrow capital for legal purposes;
Having a feasible capital usage plan. This condition is not mandatory for loans with small values;
Having the financial ability to repay the debt.

Simultaneously, Circular 12/2024/TT-NHNN also stipulates that a small-value loan is a loan as prescribed in Clause 2, Article 102 of the 2024 Credit Institutions Law and does not exceed 100,000,000 (one hundred million) VND.

Thus, compared to the current regulation where all loans must provide a capital usage plan to the bank, now loans under 100 million VND are no longer required to provide a capital usage plan.

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New regulation on bank loans under 100 million VND in Vietnam

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