Promotional banks must not exceed the maximum interest rate.

In case of applying the prize promotion form, the maximum deposit interest rate is calculated based on the listed interest rate plus the percentage of the total prize cost compared to the total mobilized capital...

Illustration photo. (Source: Internet)..

On October 26, 2011, the State Bank of Vietnam (SBV) issued Official Dispatch No. 8376/NHNN-CSTT in response to requests from a number of State Bank branches in provinces and cities and credit institutions regarding deposit interest rates in cases of applying promotional programs and paying brokerage commissions in deposit receiving activities.

Specifically, according to the provisions of the Commercial Law, Decree No. 37/2006/ND-CP dated April 4, 2006 of the Government detailing the implementation of the Commercial Law on trade promotion and the opinion of the Department of Trade Promotion - Ministry of Industry and Trade, credit institutions are allowed to promote products and services that they legally trade and supply, and the opening of prizes in lucky promotion programs is one of the forms of promotion.

On the other hand, according to the regulations of the State Bank, credit institutions and foreign bank branches set interest rates on deposits in Vietnamese Dong and US dollars of organizations (except credit institutions) and individuals, including promotional expenses in all forms (including prize promotions) must not exceed the maximum interest rate prescribed by the State Bank of Vietnam.

In case of applying the prize promotion form, the maximum deposit interest rate is calculated based on the listed interest rate plus the percentage of the total prize cost compared to the total capital mobilized under the promotion program.

When implementing promotional programs, credit institutions and foreign bank branches must report to the State Bank of Vietnam (Monetary Policy Department and Banking Inspection and Supervision Agency) to monitor and supervise the implementation of the State Bank of Vietnam's regulations on maximum deposit interest rates.

When receiving deposits, credit institutions and foreign bank branches are not allowed to carry out promotional activities that are not in accordance with the provisions of the Commercial Law, Decree No. 37/2006/ND-CP, Circular No. 30/2011/TT-NHNN, Circular No. 14/2011/TT-NHNN and relevant laws.

According to the regulations of the State Bank, relevant legal provisions and to avoid negativity in paying brokerage commissions, affecting the reputation of the banking industry and negatively impacting the stability of the monetary market, credit institutions and foreign bank branches are not allowed to pay commissions or brokerage to organizations and individuals to arrange for deposit receiving activities.

(According to Vietnam+)