Credit policy for shrimp and pangasius farmers

The Prime Minister has just issued Decision No. 540/QD-TTg on credit policy for shrimp and pangasius farmers. This Decision regulates the handling of overdue debts and restructured debts of customers who are households, farm owners, shrimp and pangasius farming cooperatives facing difficulties in production and business and debt repayment to credit institutions by December 31, 2013.

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The Decision stipulates that credit institutions shall handle debts of customers who have temporary difficulty in paying debts as follows: Restructure debt for a maximum of 36 months (including the period of debt restructuring); do not collect overdue interest or penalty interest on restructured debts; prioritize principal collection first, then interest collection; in case the customer has paid off the principal but has not paid off the interest, the credit institution shall negotiate with the customer to have a plan to gradually collect the debt in the following year; exempt or reduce loan interest according to the regulations of the credit institution.

Regarding the handling of overdue debts of customers who are unable to repay due to objective and force majeure reasons, the Decision stipulates that credit institutions, based on confirmation from the People's Committee at the commune level that customers are facing difficulties due to objective and force majeure reasons (natural disasters, epidemics, etc.), will decide to postpone debt repayment for a period of 3 years for customers. Credit institutions, based on the actual situation, will request customers who are eligible for debt repayment, complete debt repayment procedures to summarize and report to the State Bank of Vietnam before July 31, 2014.

During the debt suspension period, the credit institution calculates interest but does not collect it from the customer; if after 3 years the customer fully repays the principal, the interest will be forgiven; if the customer fails to repay the principal, the credit institution will handle the matter according to the provisions of law.

For the interest that customers have not paid up to the time of debt settlement, the credit institution will consider exempting or reducing interest according to current regulations (not including overdue interest and penalty interest).

At the same time, credit institutions continue to classify debts and set up risk provisions according to the debt group applicable to the debt at the time of debt cancellation.

Continue new lending

The State Bank of Vietnam will provide refinancing loans corresponding to the amount of debt that the credit institution has repaid to the customer at an interest rate of 0%/year. The refinancing period is 364 days and is automatically renewed annually for a period of 3 years. The State Bank of Vietnam will base on the list of customers eligible for debt rescheduling reported by the credit institution to make disbursement to the credit institution.

In addition, the Decision also stipulates that credit institutions may continue to consider granting new loans to customers to restore production and business based on effective and feasible business plans and not depending on debts that have been handled according to the provisions of this Decision.

According to chinhphu.vn