Decree No. 162/2024/ND-CP dated December 20, 2024 on licensing requirements for people’s credit funds, microfinance institutions and eligibility requirements for owners of credit institutions that are single-member limited liability companies, founding shareholders and founding members

THE GOVERNMENT OF VIETNAM -------	THE SOCIALIST REPUBLIC OF VIET NAM Independence-Freedom-Happiness -----------------
No. 162/2024/ND-CP	Hanoi, December 20, 2024

DECREE

LICENSING REQUIREMENTS FOR PEOPLE’S CREDIT FUNDS, MICROFINANCE INSTITUTIONS AND ELIGIBILITY REQUIREMENTS FOR OWNERS OF CREDIT INSTITUTIONS THAT ARE SINGLE-MEMBER LIMITED LIABILITY COMPANIES, FOUNDING SHAREHOLDERS AND FOUNDING MEMBERS

Pursuant to the Law on Government Organization dated June 19, 2015; the Law on Amendments to the Law on Government Organization and the Law on Local Government Organization dated November 22, 2019;

Pursuant to the Law on the State Bank of Vietnam dated June 16, 2010;

Pursuant to the Law on Credit Institutions dated January 18, 2024;

At the request of the Governor of the State Bank of Vietnam (SBV);

The Government of Vietnam promulgates a Decree providing licensing requirements for people’s credit funds, microfinance institutions and eligibility requirements for owners of credit institutions that are single-member limited liability companies, founding shareholders and founding members.

Chapter I

GENERAL PROVISIONS

Article 1. Scope

This Decree deals with eligibility requirements to be satisfied by owners of credit institutions that are single-member limited liability companies, founding shareholders and founding members as prescribed in point b clause 1 Article 29 of the Law on Credit Institutions, and licensing requirements to be satisfied by people’s credit funds, microfinance institutions.

Article 2. Regulated entities

1. Joint-stock commercial banks, joint-venture (JV) banks and wholly foreign-owned banks (hereinafter referred to as “commercial banks”).s

2. Foreign bank branches (FBBs).

3. Non-bank credit institutions.

4. People’s credit funds.

5. Microfinance institutions.

6. Founding shareholders, founding members, owners of credit institutions, parent banks of FBBs.

7. Other organizations and individuals involved in the establishment of and licensing for establishment of commercial banks, FBBs, non-bank credit institutions, people’s credit funds and microfinance institutions.

Article 3. Definitions

For the purpose of this Decree, the terms below are construed as follows:

1. “wholly foreign-owned bank” means a commercial bank that is established in Vietnam, has its charter capital wholly owned by a foreign credit institution, and is considered a Vietnamese juridical person and headquartered in Vietnam. A wholly foreign-owned bank may be established and organized as a single-member limited liability company whose owner is a foreign bank or as a multi-member limited liability company over 50% of charter capital of which must be held by a foreign bank.

2. “JV bank” means a commercial bank that is established in Vietnam with capital contributed by a Vietnamese party (which comprises at least a Vietnamese bank and no more than a Vietnamese enterprise that is not a bank) and a foreign party (which comprises at least a foreign bank and no more than a foreign enterprise that is not a bank) on the basis of a JV contract, and is considered a Vietnamese juridical person and headquartered in Vietnam. A JV bank may be established and organized in the form of a multi-member limited liability company with a maximum number of members of 05, provided that any member and their related persons shall not jointly hold more than 50% of the bank’s charter capital.

3. “founding shareholder” of a joint-stock commercial bank means any shareholder that owns at least an ordinary share and whose signature appears on the list of founding shareholders of this bank.

4. “founding shareholder” of a non-bank credit institution means any shareholder that owns at least an ordinary share and whose signature appears on the list of founding shareholders of this joint-stock non-bank credit institution.

5. “contributing member” of a commercial bank means a credit institution or juridical person that is not a bank and makes capital contribution to a JV bank; or a foreign credit institution that makes capital contribution to a wholly foreign-owned bank.

6. “contributing member” of a non-bank credit institution means any Vietnamese enterprise, Vietnamese commercial bank or foreign credit institution that makes capital contribution to this multi-member limited liability non-bank credit institution.

7. “contributing member” of a microfinance institution means a domestic juridical person that makes capital contribution to this microfinance institution that is a multi-member limited liability company.

8. “founding member” of a JV bank or wholly foreign-owned bank means a contributing member that engages in the formulation and ratification of and appends their signature to the initial Charter of this JV bank or wholly foreign-owned bank.

9. “founding member” of a non-bank credit institution means a contributing member that engages in the formulation and ratification of and appends their signature to the initial Charter of this multi-member limited liability non-bank credit institution.

10. “founding member” of a microfinance institution means a contributing member that engages in the formulation and ratification of and appends their signature to the initial Charter of this microfinance institution that is a multi-member limited liability company.

11. “founding member” of a people’s credit fund means a member that engages in the formulation and ratification of and appends their signature to the initial Charter of this people’s credit fund.

12. “owner” of a commercial bank means an organization that owns the entire capital of this commercial bank that is a single-member limited liability company.

13. “owner” of a non-bank credit institution means a Vietnamese commercial bank or foreign credit institution that owns the entire charter capital of this single-member limited liability non-bank credit institution.

14. “owner” of a microfinance institution means a socio-political organization that owns the entire capital of this microfinance institution that is a single-member limited liability company.

15. “parent bank” means a foreign bank that applies for establishment of a new branch or has a branch in Vietnam.

16. “member" of a people’s credit fund means a natural person, family household or juridical person that fully meets the requirements set forth in this Decree, ratifies the Charter and voluntarily contributes capital for establishing this people’s credit fund.

Chapter II.

ELIGIBILITY REQUIREMENTS FOR OWNERS OF CREDIT INSTITUTIONS THAT ARE SINGLE-MEMBER LIMITED LIABILITY COMPANIES, FOUNDING SHAREHOLDERS AND FOUNDING MEMBERS

Article 4. Eligibility requirements for founding shareholders of joint-stock commercial banks

1. A founding shareholder of a joint-stock commercial bank must not be a founding shareholder, owner, founding member or strategic shareholder of any other credit institution.

2. All founding shareholders must jointly own at least 50% of the charter capital upon establishment of the joint-stock commercial bank, and all of those who are juridical persons must jointly own at least 50% of total shares of founding shareholders but must not exceed the holdings prescribed in Article 63 of the Law on Credit Institutions.

3. In addition to the requirements laid down in clauses 1, 2 of this Article, a founding shareholder that is an individual must also satisfy the following requirements:

a) He/she must hold the Vietnamese citizenship, and have full legal capacity;

b) He/she is not a prohibited person as prescribed in the Law on Enterprises, the Law on Officials and other relevant laws.

c) He/she must not use funds mobilized or borrowed from other organizations or individuals or raised from issuance of corporate bonds to make capital contribution; must not make capital contribution under the name of another individual or juridical person in any forms, except entrustment of funds for making capital contribution or purchasing shares;

d) He/she must be a manager of an enterprise that has a profitable business for at least 03 consecutive years preceding the year in which an application for license is submitted, or holds a bachelor’s degree or postgraduate degree in finance, banking, economics, business administration, law, accounting or auditing;

dd) He/she is not having any unspent conviction for a crime against banking laws or any other banking-related crimes; has not incurred any penalties for the following administrative violations in money and banking sector, including violations against regulations on licensing, management and administration, shares or share certificates, capital contribution, purchase of shares or corporate bonds, in the last 05 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing.

4. In addition to the requirements laid down in clauses 1, 2 of this Article, a founding shareholder that is an organization must also satisfy the following requirements:

a) It is duly established in accordance to the law of Vietnam;

b) It must not use funds mobilized or borrowed from other organizations or individuals or raised from issuance of corporate bonds to make capital contribution; must not make capital contribution under the name of another individual or juridical person in any forms, except entrustment of funds for making capital contribution or purchasing shares;

c) It has fully fulfilled tax and social insurance obligations by the time of submission of application for license;

d) It has maintained a minimum equity of at least VND 500 billion in the last 05 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

dd) It has maintained a profitable business in the last 05 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

e) If the organization is an enterprise engaging in business lines subject to legal capital requirement, it must ensure that the difference between its equity, as recorded in its audited financial statements of the year preceding the year in which an application for license is submitted, and the legal capital shall not be smaller than the capital amount it will contributes as committed;

g) If the organization is a state-owned enterprise, it shall be required to obtain permission to make capital contribution as prescribed by law;

h) If the organization has been issued with a License for establishment and operation in banking, securities or insurance sector, it must satisfy capital contribution requirements laid down in the respective law on banking, securities or insurance;

i) It has not been convicted of any crimes prescribed in the Criminal Code in the last 02 (two) consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

k) If the organization is a commercial bank:

It must have total assets of at least VND 100.000 billion, and is assessed to have fully complied with regulations on risk management, and have maintained minimum provision for losses as prescribed by laws at the time of submission of the application for license and by the time of submission of additional documents to serve the application processing;

It has not committed any violation against SBV’s regulations on prudential ratios for banking operations in the year preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

It has strictly complied with conditions and limits on purchase and holding of stocks of credit institutions as prescribed in Clause 8 Article 111 of the Law on Credit Institutions;

It ensures that the minimum capital adequacy ratio is still maintained upon its completion of capital contribution to the joint-stock commercial bank;

It has not incurred any penalties for administrative violations in money and banking sector, and has not been convicted of any crimes prescribed in the Criminal Code in the last 02 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing.

Article 5. Eligibility requirements for owners that are foreign credit institutions of wholly foreign-owned banks

An owner that is a foreign credit institution of a wholly foreign-owned bank shall be required to meet the following requirements:
1. It has not committed any serious violations against regulations on banking operations and other laws of the country where it is headquartered in the last 05 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing.

2. It has experience in international operations and has been ranked by an international credit rating agency as follows:

a) It has been rated AA- upwards (according to Standard & Poor’s or Fitch Ratings) or Aa3 upwards (according to Moody’s) in the last credit rating session prior to the date of submission of an application for license. In case an international credit rating agency adopts a credit rating scale other than that of Standard & Poor’s or Moody’s or Fitch Ratings, its credit rating given by this agency must not be lower than the corresponding credit rating of Standard & Poor’s or Moody’s or Fitch Ratings;

b) The outlook of its credit rating as prescribed in point a of this clause is stable or better.

3. It has maintained a profitable business in the last 05 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing.

4. It has total assets equivalent to at least USD 10 billion at the end of the year preceding the year in which an application for license is submitted.

5. It is considered by competent authorities of the country where it is headquartered to have maintained capital adequacy ratio and other prudential ratios, and have fully complied with regulations on risk management and setting aside of provisions for losses of the country where it is headquartered in the year preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing.

6. It must not be an owner, founding member or strategic shareholder of any other credit institution in Vietnam.

7. Within 05 years from the date on which the license is issued, founding members of the wholly foreign-owned bank must altogether hold 100% of its charter capital.

Article 6. Eligibility requirements for founding members of JV banks

1. Founding members of JV banks that are foreign credit institutions must meet the requirements laid down in clauses 1, 2, 3, 4, 5, 6 Article 5 of this Decree.

2. Founding members of JV banks that are Vietnamese commercial banks must meet the requirements for commercial banks laid down in clauses 1, 4 Article 4 of this Decree.

3. A founding member of a JV bank that is an enterprise other than a bank must meet the following requirements:

a) It is duly established under the law of Vietnam or the law of a foreign country;

b) If it is a state-owned enterprise, it must obtain a written permission from a competent authority to make capital contribution to the JV bank;

c) If it has been issued with a license for establishment and operation in banking, securities or insurance sector, it must satisfy capital contribution requirements laid down in the respective law on banking, securities or insurance;

d) It must maintain a minimum equity of at least VND 1.000 billion and total assets of at least VND 2.000 billion in the last 03 consecutive years prior to the year in which an application for license is submitted, if it makes a capital contribution making up between 1% and 5% of the charter capital of the JV bank; or it must maintain a minimum equity of at least VND 200 billion and total assets of at least VND 400 billion in the last 03 consecutive years prior to the year in which an application for license is submitted, if it makes a capital contribution making up no more than 1% of the charter capital of the JV bank;

dd) If it is engaging in business lines subject to legal capital requirement, it must ensure that the difference between its equity, as recorded in its financial statements which have been audited by an independent audit organization and given no qualified opinion of the year preceding the year in which an application for license is submitted, and the legal capital shall not be smaller than the capital amount it will contributes as committed;

e) It has maintained a profitable business in the last 03 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

g) It must not use funds mobilized or borrowed from other organizations or individuals to make capital contribution;

h) It has fully fulfilled tax and social insurance obligations by the time of submission of application for license;

i) It is not joining any other credit institution duly established and operating in Vietnam as a founding shareholder, owner, founding member or strategic shareholder;

k) It has not incurred any penalties for administrative violations in money and banking sector, and has not been convicted of any crimes prescribed in the Criminal Code in the last 02 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing.

4. Within 05 years from the date on which the license is issued, founding members of the JV bank must altogether hold 100% of its charter capital.

Article 7. Eligibility requirements for parent banks of FBBs

1. Meet all of the requirements laid down in clauses 1, 2, 5 Article 5 of this Decree.

2. In addition to the requirement laid down in clause 1 of this Article, parent banks of FBBs must also meet total asset and financial health requirements imposed by SBV.

Article 8. Eligibility requirements for founding shareholders of non-bank credit institutions

1. They are not joining any other credit institution duly established and operating in Vietnam as strategic shareholders, founding shareholders, owners or founding members.

2. They must not use funds mobilized or borrowed from other organizations or individuals or raised from issuance of corporate bonds to make capital contribution.

3. In addition to the requirements laid down in Clauses 1, 2 of this Article, a founding shareholder who is an individual must also meet the following requirements:

a) He/she must hold the Vietnamese citizenship, and have full legal capacity;

b) He/she is not prohibited from enterprise establishment as prescribed in the Law on Enterprises, the Law on Officials and other relevant laws;

c) He/she must not use funds mobilized or borrowed from other organizations or individuals or raised from issuance of corporate bonds to make capital contribution; must not make capital contribution under the name of another individual or juridical person in any forms, except entrustment of funds for making capital contribution or purchasing shares;

d) He/she must be a manager of an enterprise that has a profitable business for at least 03 consecutive years preceding the year in which an application for license is submitted, or holds a bachelor’s degree or postgraduate degree in finance, banking, economics, business administration, law, accounting or auditing;

dd) He/she is not having any unspent conviction for a crime against banking laws or any other banking-related crimes; has not incurred any penalties for the following administrative violations in money and banking sector, including violations against regulations on licensing, management and administration, shares or share certificates, capital contribution, purchase of shares or corporate bonds, in the last 05 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing.

4. In addition to the requirements laid down in Clauses 1, 2 of this Article, a founding shareholder that is an organization must also meet the following requirements:

a) It is duly established under the law of Vietnam;

b) It must not use funds mobilized or borrowed from other organizations or individuals or raised from issuance of corporate bonds to make capital contribution; must not make capital contribution under the name of another individual or juridical person in any forms, except entrustment of funds for making capital contribution or purchasing shares;

c) It has maintained a profitable business in the last 03 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

d) It has fully fulfilled tax and social insurance obligations by the time of submission of application for license;

dd) It has not been convicted of any crimes prescribed in the Criminal Code in the last 02 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

e) If it is a Vietnamese enterprise (except Vietnamese commercial banks), it must also:

Maintain a minimum equity of at least VND 500 billion and total assets of at least VND 1.000 billion in the last 03 consecutive years preceding the year in which an application for license is submitted. If it is an enterprise engaging in business lines subject to legal capital requirement, it must ensure that the difference between its equity, as recorded in its audited financial statements of the year preceding the year in which an application for license is submitted, and the legal capital shall not be smaller than the capital amount it will contribute as committed;

If it has been issued with a license for establishment and operation in securities or insurance sector, it must satisfy capital contribution requirements laid down in the respective law on securities or insurance;

g) If it is a Vietnamese commercial bank, it must also meet the following requirements:

It must have total assets of at least VND 100.000 billion, and is assessed to have fully complied with regulations on risk management, and have maintained minimum provision for losses as prescribed by laws at the time of submission of the application for license and by the time of submission of additional documents to serve the application processing;

It has not committed any violation against SBV’s regulations on prudential ratios and limits for operations in the year preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

It still maintains the minimum capital adequacy ratio upon its completion of capital contribution to the non-bank credit institution;

It has not incurred any penalties for administrative violations in money and banking sector in the last 02 consecutive years preceding the year in which an application for license is submitted and by the time of application submission and submission of additional documents to serve the application processing.

Article 9. Eligibility requirements for owners and founding members of non-bank credit institutions

1. A founding member that is a Vietnamese enterprise (except Vietnamese commercial banks) shall be required to meet the following requirements:

a) It meets the requirements laid down in clauses 1, 2 Article 8 and points a, b, c, d clause 4 Article 8 of this Decree;

b) It maintains a minimum equity of at least VND 1.000 billion and total assets of at least VND 2.000 billion in the last 03 consecutive years preceding the year in which an application for license is submitted. If it is an enterprise engaging in business lines subject to legal capital requirement, it must ensure that the difference between its equity, as recorded in its audited financial statements of the year preceding the year in which an application for license is submitted, and the legal capital shall not be smaller than the capital amount it will contribute as committed;

c) If it has been issued with a license for establishment and operation in securities or insurance sector, it must satisfy capital contribution requirements laid down in the respective law on securities or insurance;

d) It has not been convicted of any crimes prescribed in the Criminal Code in the last 02 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing.

2. An owner or founding member that is a Vietnamese commercial bank (except the owner defined in Clause 5 of this Article) must meet the requirements laid down in Clauses 1, 2 Article 8 and Points c, d, dd, g Clause 4 Article 8 of this Decree.

3. An owner or founding member that is a foreign credit institution shall be required to meet the following requirements:

a) It meets total asset and financial health requirements imposed by SBV;

b) It has not committed any serious violations against regulations on banking operations and other laws of the country where it is headquartered in the last 05 years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

c) It has experience in international operations and has been ranked by an international credit rating agency as follows:

It has been rated A- upwards (according to Standard & Poor’s or Fitch Ratings) or A3 upwards (according to Moody’s) in the last credit rating session prior to the date of submission of an application for license. Where the credit rating scale of another international credit rating agency is employed, this agency must be registered with or certified by the European Securities and Markets Authority (ESMA) or must obtain permission from a G7 country to provide credit rating services for foreign credit institutions that establish non-bank credit institutions in Vietnam, and it has been rated A upwards by this agency;

The outlook of its credit rating as prescribed in this point is stable or better.

d) It is considered by competent authorities of the country where it is headquartered to have maintained capital adequacy ratio and other prudential ratios, and have fully complied with regulations on risk management and setting aside of provisions for losses of the country where it is headquartered in the year preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

dd) It is not joining any other credit institution duly established and operating in Vietnam as a strategic shareholder, owner or founding member.

4. Within 05 years from the date on which the license is issued, the owner or founding members of a limited liability non-bank credit institution must altogether hold 100% of its charter capital, except the case prescribed in point c clause 5 of this Article.

5. If the owner that is a Vietnamese commercial bank subject to mandatory transfer establishes a non-bank credit institution to implement the approved mandatory transfer plan, it shall be required to meet the following requirements:

a) It meets the requirements laid down in clauses 1, 2 Article 8 and point d clause 4 Article 8 of this Decree;

b) It maintains a minimum amount of charter capital which is not smaller than the sum of the legal capital to be maintained by the commercial bank and that to be maintained by the non-bank credit institution as prescribed by law by the time of submission of application for license;

c) The duration of ownership prescribed in clause 4 of this Article shall comply with the approved mandatory transfer plan.

Chapter III

LICENSING REQUIREMENTS FOR PEOPLE’S CREDIT FUNDS, MICROFINANCE INSTITUTIONS

Article 10. Licensing requirements for people’s credit funds

In order to be eligible for a license, a people's credit fund has to meet the following requirements:

1. It maintains a minimum amount of charter capital which is not smaller the legal capital prescribed by the Government at the time of submission of application for license.

2. There are at least 30 members that meet the requirements laid down in Article 1 of this Decree and are financially capable of making capital contribution to the people’s credit fund.

3. Its managers, executive officers and members of Control Board meet all eligibility requirements and standards set forth in clause 6 Article 41 of the Law on Credit Institutions.

4. The composition of its Board of Directors and Control Board complies with provisions of the Law on Credit Institutions.

5. It has a Charter conformable with provisions of the Law on Credit Institutions and other relevant laws.

6. It has an establishment scheme and feasible business plan for the first 03 years of its operations.

Article 11. Eligibility requirements for founding members of people’s credit funds

1. For an individual:

a) He/she must be a Vietnamese citizen aged 18 or older, fully capable of civil acts, and have permanent or temporary residence registered in the area of operation of the people’s credit fund. In case of temporary residence, he/she must do business or work in the people’s credit fund’s area of operation and provide documentary evidences thereof;

b) He/she is not facing any criminal prosecution, serving an imprisonment sentence, or serving an administrative penalty in a correctional institution or rehabilitation center; is not prohibited by a Court from holding certain positions or doing certain works; is not having any unspent conviction for a serious crime or worse;

c) He/she is not a prohibited person as prescribed in the Law on Officials and other relevant laws.

2. For a family household:

a) Its members must have permanent residence in the area of operation of the people’s credit fund; jointly have property to serve their household's production and/or service provision;

b) One of its members must be appointed to act as its representative to perform rights and obligations of a member of the people’s credit fund. Such representative must be authorized in writing by other members of the family household as prescribed by law and must meet the requirements set out in clause 1 of this Article.

3. For a juridical person:

a) The juridical person (except social funds and charitable funds) must be normally operating and headquartered in the area of operation of the people’s credit fund;

b) The person who acts as a member of the people’s credit fund on behalf of the juridical person must be its legal representative or his/her authorized person.

Article 12. Licensing requirements for microfinance institutions

In order to be eligible for a license, a microfinance institution has to meet the following requirements:
1. It maintains a minimum amount of charter capital which is not smaller the legal capital prescribed by the Government at the time of submission of application for license.

2. Its owner or founding members meet the requirements laid down in Article 13 of this Decree.

3. Its managers, executive officers and members of Control Board meet all of eligibility requirements and standards imposed by SBV.

4. It has a Charter conformable with provisions of the Law on Credit Institutions and relevant laws.

5. It has an establishment scheme and feasible business plan for the first 03 years of its operations.

Article 13. Eligibility requirements for owners and founding members of microfinance institutions

1. An owner of a microfinance institution that is established in the form of a single-member limited liability company has to meet the following requirements:

a) It is a central-level socio-political organization;

b) It is financially capable of making capital contribution to the microfinance institution and provides a commitment that it shall not use entrusted funds or funds mobilized or borrowed from other organizations or individuals for making capital contribution; provides a commitment to give financial assistance to the microfinance institution when it has capital or liquidity problems;

c) It is not joining any other credit institution in Vietnam as a founding shareholder, founding member or strategic shareholder.

2. A founding member of a microfinance institution that is a multi-member limited liability company has to meet the following requirements:

a) There is at least a contributing member that is a central-level socio-political organization and meets the requirements laid down in points b and c clause 1 of this Article;

b) There is at least a contributing member that is a juridical person and used to engage in or is currently engaging in management or operation of a microfinance program/project which has been operating safely and sustainably for at least 03 consecutive years before the time of submission of application for license; has not been convicted of any crimes prescribed in the Criminal Code in the last 02 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

c) Other contributing members are juridical persons that meet the following requirements:

They are duly established under the law of Vietnam;

They are not joining any other credit institution in Vietnam as founding shareholders, owners, founding members or strategic shareholders; have not been convicted of any crimes prescribed in the Criminal Code in the last 02 consecutive years preceding the year in which an application for license is submitted and by the time of submission of additional documents to serve the application processing;

They are financially capable of making capital contribution to the microfinance institution and provide commitment that they shall not use entrusted funds or funds mobilized or borrowed from other organizations or individuals for making capital contribution; provide commitment to give financial assistance to the microfinance institution when it has capital or liquidity problems;

They have fully fulfilled tax and social insurance obligations by the time of submission of application for license;

They have not incurred the highest fine in the fine bracket for any of the following administrative violations in money and banking sector, including violations against regulations on licensing, management and administration, shares or share certificates, capital contribution, purchase of shares, credit extension, purchase of corporate bonds, or prudential ratios as prescribed in the law on penalties for administrative violations in money and banking sector in the last 02 years preceding the year in which an application for license is submitted;

If the founding member is an enterprise, it has maintained a profitable business in the last 03 years preceding the year in which an application for license is submitted;

If the founding member is an enterprise engaging in business lines subject to legal capital requirement, it must ensure that the difference between its equity, as recorded in its audited financial statements of the year before the time of submission of an application for license, and the legal capital shall not be smaller than the capital amount it will contribute as committed;

If the founding member is an enterprise that has been issued with a license for establishment and operation in banking, securities or insurance sector, it must satisfy capital contribution requirements laid down in the respective law on banking, securities or insurance.

Chapter IV

IMPLEMENTATION

Article 14. Effect

1. This Decree comes into force from December 20, 2024.

2. The Government’s Decree No. 39/2014/ND-CP dated May 07, 2014 on operations of financial companies and finance lease companies ceases to have effect from the effective date of this Decree.

Article 15. Responsibility for implementation

The SBV’s Governor, Ministers, heads of ministerial agencies, heads of Governmental agencies, Chairpersons of People’s Committees of central-affiliated cities or provinces, Chairpersons of Boards of Members, Chairpersons of Boards of Directors, General Directors of credit institutions and FBBs, and relevant organizations and individuals are responsible for the implementation of this Decree.

ON BEHALF OF THE GOVERNMENT PP. PRIME MINISTER DEPUTY PRIME MINISTER Ho Duc Phoc