Chương II Thông tư 29/2024/TT-NHNN quy định về quỹ tín dụng nhân dân do Thống đốc Ngân hàng Nhà nước Việt Nam: Quy định cụ thể

Chapter II

SPECIFIC PROVISIONS

Section 1. MEMBERS

Article 8. Membership qualifications

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, the individual must do business or work in the people’s credit fund’s area of operation and provide documentary evidences thereof;

b) He/she is an official or public employee of an organization or regulatory authority headquartered in the area of operation of the people’s credit fund;

c) 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; has not been convicted for a serious crime or another more serious crime which has not yet expunged.

2. For a family household:

a) Members of the family household must have permanent residence in the area of operation of the people’s credit fund; jointly have property to serve their household's business;

b) One of the members of the family household 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 qualifications 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 lawfully 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.

4. Individuals, family households and juridical persons must voluntarily submit applications for membership of the people’s credit fund using the forms in Appendix 01, Appendix 02 and Appendix 03 respectively, ratify the Charter of the people’s credit fund, and fully contribute capital as prescribed in Article 10 of this Circular.

5. Each of the entities prescribed in clauses 1, 2 and 3 of this Article may only become a member of 01 people’s credit fund.

6. The Board of Directors shall decide the admission of members and publish the list of members admitted in the reporting period at the nearest General Meeting of Members (GMM).

7. Membership qualifications and admission procedures must be specified in the Charter of the people’s credit fund.

Article 9. Termination of membership

1. A member of the people’s credit fund shall have their membership terminated in the following cases:

a) The membership will be automatically terminated if:

(i) A member that is an individual dies or is declared missing;

(ii) A member that is a juridical person has its status of juridical person terminated;

(iii) A member no longer meets the membership qualifications set out in Article 8 of this Circular, except the case prescribed in point c(i) of this clause;

(iv) A member has entirely transferred their stakes to another person in accordance with regulations of law and the Charter of the people’s credit fund;

b) Voluntary termination of membership: A member voluntarily withdraws from membership of the people’s credit fund with the approval of its Board of Directors;

c) Expulsion of members: A member will be expelled from the people’s credit fund by its GMM if:

(i) they fail to make sufficient capital contribution as prescribed in clause 1 Article 10 of this Circular;

(ii) any document included in the member dossier is forged;

(iii) in other cases as prescribed in the Charter of the people’s credit fund.

2. The Board of Directors shall decide the termination of membership and publish the list of members having their membership terminated in the reporting period at the nearest GMM.

3. Upon termination of membership as prescribed in clause 1 of this Article, the member’s stake will be settled as follows:

a) If the membership is terminated according to point a(i), a(ii) or a(iii) clause 1 of this Article:

(i) The member’s stake will be transferred according to clause 1 Article 12 of this Circular or will be returned to the member according to clause 3 Article 12 of this Circular;

 (ii) If a member that is an individual dies or is declared missing or incapacitated or to be a person with limited capacity for civil acts, his/her rights and obligations shall be performed in accordance with provisions of the Civil Code;

 (iii) If a member that is a juridical person has its status of juridical person terminated, regulations of law on reorganization, dissolution and bankruptcy shall apply;

b) If the membership is terminated according to point b clause 1 of this Article, the member’s stake will be transferred according to clause 1 Article 12 of this Circular or will be returned to the member according to clause 3 Article 12 of this Circular;

c) If the membership is terminated according to point c clause 1 of this Article, the member’s stake shall not be transferred.  The stake will be returned to the member according to clause 3 Article 12 of this Circular.

4. The member whose membership is terminated shall be entitled to benefits (if any) provided under a decision of the GMM after the member has fulfilled all financial obligations as prescribed by law and the Charter of the people’s credit fund.

Article 10. Capital contribution by members

1. A member’s capital contributions include capital contributed to establish membership interest and additionally contributed capital. To be specific:

a) The minimum amount of the capital contributed to establish membership interest is VND 300.000 and is specified in the Charter;

b) The additionally contributed capital shall comply with provisions of the Charter.

2. Total capital amount contributed by a member to the people’s credit fund shall not exceed 10% of its charter capital or a smaller ratio as prescribed in its Charter.

3. The GMM shall decide specific amounts of capital contributed to establish membership interest and additionally contributed capital, contribution method, and maximum capital contribution by a member as prescribed in clause 1 and clause 2 of this Article.

4. Capital amounts contributed by members as prescribed in clause 1 of this Article shall be included in the charter capital as follows:

a) The capital contributed to establish membership interest is included in the charter capital after the Board of Directors issues a decision to admit new member;

b) The additionally contributed capital is included in the charter capital after the member completes their capital contribution.

5. Based on the capital amount actually contributed by the member as prescribed in clause 1 and clause 2 of this Article, the people’s credit fund shall:

a) issue a membership card using the form which is prescribed by the cooperative bank and consistently applied throughout the system of people’s credit funds, and a capital contribution certificate which is made using the form in Appendix 04 enclosed herewith to the new member after the Board of Directors issues a decision to admit new member;

b) enter changes in contributed capital into the capital contribution certificate after the member completes their additional capital contribution.

6. The people’s credit fund must open books for monitoring capital contribution, transfer and return of stakes to members.

Article 11. Distribution of profits to members

Profits of a people’s credit fund shall be distributed to its members based on the member’s use of products/services and the member’s holding at the people’s credit fund, and according to the decision issued by the GMM of the people’s credit fund in conformity with regulations of law.

Article 12. Transfer and return of contributed capital (hereinafter referred to as “stakes”)

1. Each member is entitled to transfer a part or all of their stakes to other member(s). A member’s transfer of stakes is subject to the approval of the Board of Directors and the following provisions:

a) The remaining value of the member’s stake (if a part of the member’s stake is transferred) meets the capital contribution requirement set out in clause 1 and clause 2 Article 10 of this Circular;

b) A member may entirely transfer their stake only after they have repaid loan debts and fulfilled other financial obligations to the people’s credit fund in accordance with regulations of law and the Charter of the people’s credit fund.  

c) The transferee must meet the maximum capital contribution requirement set out in clause 2 Article 10 of this Circular.

2. The people’s credit fund shall return stakes to its members upon termination of their membership or return the amount of the member's stake that exceeds the maximum capital contribution of a member prescribed in clause 2 Article 10 of this Circular and the Charter of the people’s credit fund.

3. Return of stakes to members must meet the following conditions:

a) For members: The member must have fulfilled their financial obligations to the people’s credit fund, including:

(i) The member’s debts (including principal and interest);

(ii) Losses for which the member is liable to pay compensation;

(iii) Business losses and risks to which the member is jointly liable in proportion to their holding according to the decision of the GMM;

b) For the people’s credit fund:

(i) Such return does not make the paid-in charter capital of the people’s credit fund lower than the legal capital;

(ii) The people’s credit fund does not violate regulations on minimum capital adequacy ratio, ratio of deposits received from its members, purchase and investment in its fixed assets before and after returning stakes to its members;

(iii) In case of entire return of stake to a member, the amount of stake returned to the member shall be determined using the following formula:

A = B - C

Where:

A: Amount of stake returned to the member.

B: Sum of the capital contributed to establish membership interest and additionally contributed capital of the member as prescribed in clause 1 Article 10 of this Circular.

C: Financial obligations to be fulfilled by the member as prescribed in point a of this clause.

4. Return of stake to a member upon termination of their membership as prescribed in point c clause 1 Article 9 of this Circular is subject to the approval of the GMM.

Return of stakes to members upon termination of their membership as prescribed in point a(i), point a(ii), point a(iii) and point b clause 1 Article 9 of this Circular shall be decided and reported by the Board of Directors at the nearest GMM.

5. By the 05^th day of the following month, the people’s credit fund shall submit monthly report to the SBV’s branch of province or central-affiliated city where it is headquartered (hereinafter referred to as “SBV's provincial branch”) on transfer of stake by the member that holds 5% - 10% of the charter capital of the people’s credit fund.

Article 13. Change in charter capital

1. The Board of Directors shall decide the increase or decrease in the charter capital and report it to the nearest GMM in the following cases:

a) Receipt of capital contributed by new members or additionally contributed by existing members;

b) Return of stake to members upon termination of their membership as prescribed in points a(i), a(ii), a(iii), and point b clause 1 Article 9 of this Circular.

2. The GMM shall decide the increase or decrease in the charter capital in the following cases:

a) Use of the additional reserve fund of charter capital, other funds as prescribed by law and other lawful funding sources for increasing the charter capital;

b) Return of stakes to members upon termination of their membership as prescribed in point c clause 1 Article 9 of this Circular.

3. By the 05^th day of the following month, the people’s credit fund shall submit monthly report to the SBV’s provincial branch on the number of its new members, the number of members that have their membership terminated, total capital contributed by members, and total capital returned in the month for performing management and supervision tasks.

4. Required documents and procedures for applying for approval of revisions to the people’s credit fund’s License regarding its charter capital shall comply with regulations adopted by the SBV’s Governor on changes subject to SBV’s approval of credit institutions that are cooperatives.

Section 2. GENERAL MEETING OF MEMBERS (GMM)

Article 14. Convening GMM

1. The Board of Directors shall convene the annual GMM within 04 months from the end of the fiscal year.

2. The GMM can be held in the form of a plenary meeting or delegate meeting (hereinafter referred to as the “GMM”). The plenary meeting and the delegate meeting shall have the same duties and powers.

3. The number of delegates attending the delegate meeting is prescribed in the Charter of the people’s credit fund but shall not be fewer than 100 delegates.

4. Standards of delegates and procedures for election of delegates to attend the delegate meeting are provided in the Charter of the people’s credit fund. Election of delegates to attend the delegate meeting must ensure democracy and equality among members. Elected delegates shall not be allowed to authorize others to attend the delegate meeting. Delegates attending the delegate meeting must express opinions and aspirations of and communicate the meeting results to members that they represented.

5. An extraordinary meeting of the GMM shall be convened in the following cases:

a) It is convened by the Board of Directors to settle the matters beyond its jurisdiction;

b) It is convened by the Board of Directors at the request of the Board of Controllers or at least one third of total members of the people’s credit fund;

c) It is convened by the Board of Directors at the request of the SBV’s provincial branch in case there is any event that may adversely affect the safe operation of the people’s credit fund;

d) It is convened by Chairperson of the Board of Directors in case a periodical meeting of the Board of Directors cannot be held after it has been convened twice;

d) Other cases as prescribed in the Charter of the people’s credit fund.

The people’s credit fund must submit a report to the SBV’s provincial branch on reasons, agenda, time and form of the extraordinary meeting of the GMM at least 10 days before the planned date of the meeting.

6. An extraordinary meeting of the GMM in the case specified in Point b or Point c Clause 5 of this Article shall be convened as follows:

a) Within 15 days from its receipt of the request of the Board of Controllers or at least one third of total members of the people’s credit fund or the request of the SBV's provincial branch, the Board of Directors shall convene the extraordinary meeting of the GMM;

b) If Board of Directors fails to convene the extraordinary meeting of the GMM within the time limit of 15 days specified in Point a of this Clause or fails to convene the annual GMM within 04 months from the end of the fiscal year, the Board of Controllers shall be entitled to convene the extraordinary meeting of the GMM;

c) If the Board of Controllers fails to convene the extraordinary meeting of the GMM within 15 days from the day on which it is entitled to the right to do so as prescribed in Point b of this Clause, the member representing at least one third of total members of the people’s credit fund shall be entitled to convene the GMM. A record of appointment of this representative must be made and bear signatures of all members that request the convening of the GMM.

7. In case the Board of Directors fails to convene the GMM as prescribed in Clause 1 and Point a Clause 6 of this Article, they shall pay compensation for damage incurred by the people’s credit fund in accordance with regulations of law and the people’s credit fund’s Charter.

In case the Board of Controllers fails to convene the GMM as prescribed in Point b Clause 6 of this Article, they shall also pay compensation for damage incurred by the people’s credit fund in accordance with regulations of law and the people’s credit fund’s Charter.

8. The meeting of the GMM shall be chaired by the person who convenes it, unless another chair is elected by the GMM.

9. The meeting of the GMM shall be conducted when it is participated in by at least 75% of total members or total delegates elected to attend the meeting. If a delegate meeting is held, it must be attended by at least 100 delegates. Where the required number of participants is not sufficient, the meeting of the GMM shall be postponed.

In case the conditions for conducting the first meeting of the GMM are not fulfilled, the second meeting will be convened within 30 days from the planned date of the first meeting. In this case, before conducting the second meeting, the person who convenes the meeting shall submit a report on reasons for failure to conduct the first meeting and the planned date of the second meeting to the SBV’s provincial branch. The second meeting of the GMM shall be conducted when it is participated in by at least 50% of total members or total delegates elected to attend the meeting.

In case the conditions for conducting the second meeting of the GMM are not fulfilled, the third meeting will be convened within 20 days from the planned date of the second meeting. In this case, before conducting the third meeting, the person who convenes the meeting shall submit a report on reasons for failure to conduct the second meeting and the planned date of the third meeting to the SBV’s provincial branch. The third meeting of the GMM shall be conducted regardless of the number of participants.

10. The meeting of the GMM may be on-site meeting, online meeting or hybrid meeting. The form of the meeting of the GMM shall be selected according to the Charter of the people’s credit fund.

11. The minutes of the meeting of the GMM shall be compulsory while their audio and video recordings are optional. These materials shall be provided at the request of members. The minutes must bear signatures of the chair and secretary of the meeting. In case the chair and the secretary refuse to sign the minutes, the minutes shall be effective if they are ratified by more than 50% of the members participating in the meeting. In this case, the minutes shall clearly state the refusal by the chair and the secretary to sign them. The persons who sign the minutes shall be jointly responsible for the accuracy and truthfulness of the minutes.

Article 15. Preparing for GMM

1. The person who convenes the GMM shall prepare a list of members/delegates entitled to participate in the meeting; draw up the meeting agenda, prepare documents and draft the resolution of the meeting; send the invitation to each member at least 07 days before the planned opening date of the annual meeting or at least 05 days before the planned opening date of the extraordinary meeting. The invitation shall specify the time, location, method and agenda of the meeting. The invitations to the meeting can be sent physically, electronically or by another method prescribed in the Charter of the people’s credit fund.

2. A content of the meeting agenda may be modified according to written proposal by at least one third of total members. It must contain full name of the member that makes the proposal and proposed content.

The proposed content shall be sent to the person who convenes the meeting at least 03 days before the planned date of the meeting.

In case of an extraordinary meeting, the person who convenes the meeting shall consider adding the proposed content to the agenda of the extraordinary meeting to be conducted or the following extraordinary meeting.

3. The person who convenes the GMM is entitled to refuse the proposal specified in clause 2 of this Article in the following cases:

a) The proposal is not sent by the prescribed deadline;

b) The proposed content is beyond the jurisdiction of the GMM;

c) Other cases as prescribed in the Charter of the people’s credit fund.

4. The person who convenes the GMM must report the refused proposal to the GMM before voting to ratify the meeting agenda.

Article 16. Participating in and voting at meetings of GMM

1. It will be considered that a member or delegate participates in and votes at the meeting of the GMM in the following cases:

a) He/she directly participates in and votes at the meeting;

b) He/she participates and votes online.

2. Each of the following contents will be ratified by the GMM when it is voted for by at least 75% of total members or delegates participating in the meeting:

a) Revisions to the people’s credit fund’s Charter;

b) Investment in, purchase or sale of fixed assets of the people’s credit fund in case the investment amount, estimated purchasing price or historical cost of the fixed asset accounts for at least 20% of the charter capital of the people’s credit fund as recorded in the latest audited financial statements or latest financial statements of the people’s credit fund (if its audited financial statements are not available) (of a smaller ratio as prescribed in the people’s credit fund’s Charter);

c) Organizational structure of the people’s credit fund;

d) Split-off, split-up, consolidation, merger or voluntary dissolution of the people’s credit fund.

3. Any content other than those specified in clause 2 of this Article will be ratified when it is voted for by at least 50% of total members or delegates participating in an the meeting.

4. Each member participating in the plenary meeting shall have one vote of equal effect regardless of their stakes and position. Each delegate participating in the delegate meeting shall have a number of votes equal to the number of members that he/she represents.

5. Votes casted and the record of the vote counting conducted at the meeting of the GMM must be retained.

Section 3. BOARD OF DIRECTORS

Article 17. Term of office of Chairperson and members of Board of Directors

1. A person may not hold the position of Chairperson of the Board of Directors for more than 02 consecutive terms.

2. The term of office of the Chairperson and members of the Board of Directors shall be the same as that of the Board of Directors.

Article 18. Meetings of Board of Directors

1. The Board of Directors of a people’s credit fund shall meet on a periodical basis as prescribed in its Charter but at least every month to fulfill its tasks as prescribed by law.

2. An extraordinary meeting of the Board of Directors may be held at the request of:

a) Its Chairperson;

b) Director;

c) The head of the Board of Controllers; or

d) At least one third of total members of the Board of Directors.

3. Procedures for conducting a meeting of the Board of Directors:

a) A meeting of the Board of Directors shall be conducted when it is participated in by at least two thirds of its total members. Decisions of the Board of Directors shall be ratified under the majority rule. Each member shall have one vote of equal effect. In case of equality of votes, the option that is voted for by the Chairperson of the Board of Directors or the person authorized by the Chairperson to chair the meeting shall prevail;

b) In case a periodical meeting of the Board of Directors cannot be conducted due to inadequate number of participants, the Chairperson of the Board of Directors shall convene the second meeting within 15 days from the planned date of the first meeting. In this case, the second meeting shall be conducted when it is participated in by more than 50% of total members of the Board of Directors;

c) In case the second meeting of the Board of Directors cannot be conducted due to inadequate number of participants, the Chairperson of the Board of Directors shall convene an extraordinary meeting of the GMM within 30 days from the planned date of the second meeting. The Chairperson of the Board of Directors shall request the extraordinary GMM to consider the eligibility of the members of the Board of Directors who refuse to participate in its meetings as notified and propose appropriate disciplinary actions;

d) The minutes of every meeting of the Board of Directors shall be compulsory while its audio and video recordings are optional. These materials shall be provided at the request of its members. The minutes must bear signatures of the chair and secretary of the meeting. Members of Board of Directors shall be entitled to have their opinions recorded in the meeting minutes.  In case the chair and the secretary refuse to sign the minutes, the minutes shall be effective if they are signed by more than 50% of the members participating in the meeting. In this case, the minutes shall clearly state the refusal by the chair and the secretary to sign them. The persons who sign the minutes shall be jointly responsible for the accuracy and truthfulness of the minutes.

4. In case the ratification of a content by the Board of Directors against regulations of law, the resolution of the GMM or the people’s credit fund’s Charter causes damage to the people’s credit fund, the members that vote for the ratification of that content shall be jointly responsible for it and pay compensation for the damage incurred by the people’s credit fund in accordance with regulations of law; the members that vote against the ratification of that content shall not be held responsible and shall be entitled to request a competent Court to suspend or invalidate that content.

Article 19. Eligibility requirements and standards to be satisfied by Chairperson and members of Board of Directors

1. To become a member of the Board of Directors, a person must satisfy the following eligibility requirements and standards:

a) For a people’s credit fund whose total assets are worth less than VND 200 billion:

(i) Be an individual member or representative for the stake of a member that is a juridical person;

(ii) Have permanent residence registered in the area of operation of the people’s credit fund;

(iii) Be fit to perform tasks;

(iv) Be not subject to Article 42 and 43 of the Law on Credit Institutions.

(v) Have complied with the code of professional ethics;

(vi) Have at least 01 year’s experience of working as a manager or executive of a credit institution, or at least 02 years’ experience of working as manager of a finance, banking, accounting or audit enterprise, or at least 03 years’ experience of working directly at finance, banking, accounting and audit departments;

(vii) Possess an intermediate education diploma in finance, banking, accounting, auditing, business administration or law, and a diploma (or certificate) proving that he/she has successfully completed a training course in operations of people’s credit fund under the SBV’s training program for operations of people’s credit funds or possess a junior college's degree in finance, banking, accounting, auditing, business administration or law, or possess a bachelor’s degree or higher;

b) For a people’s credit fund whose total assets are worth from VND 200 billion to under VND 500 billion:

(i) Satisfy the eligibility requirements and standards set out in points a(i), a(ii), a(iii), a(iv) and a(v) of this clause;

(ii) Have at least 02 years' experience of working as a manager or executive of a credit institution, or at least 03 years’ experience of working as manager of a finance, banking, accounting or audit enterprise, or at least 04 years’ experience of working directly at finance, banking, accounting and audit departments;

(iii) Possess a junior college's degree in finance, banking, accounting, auditing, business administration or law, or possess a bachelor’s degree or higher;

c) For a people’s credit fund whose total assets are worth VND 500 billion or higher:

(i) Satisfy the eligibility requirements and standards set out in points a(i), a(ii), a(iii), a(iv) and a(v) of this clause;

(ii) Have at least 03 years' experience of working as a manager or executive of a credit institution, or at least 04 years’ experience of working as manager of a finance, banking, accounting or audit enterprise, or at least 05 years’ experience of working directly at finance, banking, accounting and audit departments;

(iii) Possess a bachelor’s degree or higher.

2. The Chairperson of the Board of Directors must meet the following eligibility requirements and standards, except the case prescribed in clause 3 of this Article:

a) For a people’s credit fund whose total assets are worth less than VND 200 billion:

(i) Be an individual member of the people’s credit fund;

(ii) Satisfy the eligibility requirements and standards set out in points a(ii), a(iii), a(iv) and a(v) clause 1 of this Article;

(iii) Have at least 02 years' experience of working as a manager or executive of a credit institution, or at least 03 years’ experience of working as manager of a finance, banking, accounting or audit enterprise, or at least 04 years’ experience of working directly at finance, banking, accounting and audit departments;

(iv) Possess a junior college's degree in finance, banking, accounting, auditing, business administration or law, or possess a bachelor’s degree or higher;

b) For a people’s credit fund whose total assets are worth from VND 200 billion to under VND 500 billion:

(i) Satisfy the eligibility requirements and standards set out in points a(i) and a(ii) of this clause;

(ii) Have at least 03 years' experience of working as a manager or executive of a credit institution, or at least 04 years’ experience of working as manager of a finance, banking, accounting or audit enterprise, or at least 05 years’ experience of working directly at finance, banking, accounting and audit departments;

(iii) Possess a bachelor’s degree or higher;

c) For a people’s credit fund whose total assets are worth VND 500 billion or higher:

(i) Satisfy the eligibility requirements and standards set out in points a(i) and a(ii) of this clause;

(ii) Have at least 03 years' experience of working as a manager or executive of a credit institution, or at least 05 years’ experience of working as manager of a finance, banking, accounting or audit enterprise, or at least 05 years’ experience of working directly at finance, banking, accounting and audit departments;

(iii) Possess a bachelor’s degree or higher.

3. The SBV’s provincial branch shall reach an agreement with the People’s Committee of commune where the people’s credit fund is headquartered, and the cooperative bank on appointment of the Chairperson of the Board of Directors of the people’s credit fund according to the following provisions:

a) The Chairperson of the Board of Directors of a people’s credit fund will be appointed if:

(i) The people’s credit fund fails to appoint a qualified Chairperson of the Board of Directors within the time limit prescribed in clause 2 Article 87 of the Law on Credit Institutions;

(ii) The people’s credit fund is placed under special control; or

(iii) In other cases where such appointment is requested by the SBV’s provincial branch when the people’s credit fund is facing risks which may threaten its safe operation;

b) The person who is appointed as Chairperson of the Board of Directors must:

(i) be reputable and have strictly complied with laws;

(ii) possess a bachelor’s degree or higher, or possess an intermediate education diploma or higher (for a commune-level official);

(iii) have at least 01 year’s experience of working as a manager or executive of a banking, finance, accounting or audit entity as certified in the Charter or another document of equivalent validity of this entity, or at least 03 years’ experience of working directly at finance, banking, accounting and audit departments, or be a commune-level official.

Section 4. BOARD OF CONTROLLERS

Article 20. Board of Controllers

1. Number of members of the Board of Controllers:

a) The Board of Controllers of the people’s credit fund whose total assets are worth less than VND 50 billion shall have at least 01 member. If the Board of Controllers has the only one member, this member shall also act as the head of the Board of Controllers;

b) The Board of Controllers of the people’s credit fund whose total assets are worth from VND 50 billion to under VND 200 billion shall have at least 02 members;

c) The Board of Controllers of the people’s credit fund whose total assets are worth VND 200 billion or higher shall have at least 03 members.

2. A person may not hold the position of the head of the Board of Controllers for more than 02 consecutive terms.

3. Members of the Board of Controllers shall directly perform internal control tasks.

Article 21. Eligibility requirements and standards to be satisfied by head and members of Board of Controllers

1. In order to become a member of the Board of Controllers, a person must meet the following eligibility requirements and standards:

a) For a people’s credit fund whose total assets are worth less than VND 200 billion:

(i) Satisfy the eligibility requirements and standards set out in points a(i), a(ii), a(iii), a(iv) and a(v) clause 1 Article 19 of this Circular;

(ii) Have at least 01 year’s experience of working directly at finance, banking, accounting and audit departments;

(iii) Possess an intermediate education diploma in finance, banking, accounting, auditing, business administration or law, and a diploma (or certificate) proving that he/she has successfully completed a training course in operations of people’s credit fund under the SBV’s training program for operations of people’s credit funds or possess a junior college's degree in finance, banking, accounting, auditing, business administration or law, or possess a bachelor’s degree or higher;

b) For a people’s credit fund whose total assets are worth from VND 200 billion to under VND 500 billion:

(i) Satisfy the eligibility requirements and standards set out in points a(i), a(ii), a(iii), a(iv) and a(v) clause 1 Article 19 of this Circular;

(ii) Have at least 02 years’ experience of working directly at finance, banking, accounting and audit departments;

(iii) Possess a junior college's degree in finance, banking, accounting, auditing, business administration or law, or possess a bachelor’s degree or higher;

c) For a people’s credit fund whose total assets are worth VND 500 billion or higher:

(i) Satisfy the eligibility requirements and standards set out in points a(i), a(ii), a(iii), a(iv) and a(v) clause 1 Article 19 of this Circular;

(ii) Have at least 03 years’ experience of working directly at finance, banking, accounting and audit departments;

(iii) Possess a bachelor’s degree or higher.

2. The head of the Board of Controllers must meet the following eligibility requirements and standards:

a) For a people’s credit fund whose total assets are worth less than VND 200 billion:

(i) Be an individual member of the people’s credit fund;

(ii) Satisfy the eligibility requirements and standards set out in points a(ii), a(iii), a(iv) and a(v) clause 1 Article 19 of this Circular;

(iii) Have at least 02 years’ experience of working directly in finance, banking, accounting and audit fields;

(iv) Possess a junior college's degree in finance, banking, accounting, auditing, business administration or law, or possess a bachelor’s degree or higher;

b) For a people’s credit fund whose total assets are worth VND 200 billion or higher:

(i) Satisfy the eligibility requirements and standards set out in points a(i) and a(ii) of this clause;

(ii) Have at least 03 years’ experience of working directly in finance, banking, accounting and audit fields;

(iii) Possess a bachelor’s degree or higher.

Section 5. ELIGIBILITY REQUIREMENTS AND STANDARDS TO BE SATISFIED BY DIRECTOR, DEPUTY DIRECTOR(S), CHIEF ACCOUNTANT AND BRANCH DIRECTOR(S)

Article 22. Eligibility requirements and standards to be satisfied by Director

1. For a people’s credit fund whose total assets are worth less than VND 200 billion, except the case prescribed in clause 4 of this Article:

a) If a member of the Board of Directors is appointed as the Director, he/she must:

(i) be an individual member of the people’s credit fund;

(ii) possess a junior college's degree in finance, banking, accounting, auditing, business administration or law, or possess a bachelor’s degree or higher;

b) If the Director is hired, he/she must:

(i) satisfy the eligibility requirements and standards set out in points a(iii), a(iv) and a(v) clause 1 Article 19 of this Circular;

(ii) possess a bachelor’s degree or higher;

(iii) have his/her permanent or temporary residence registered in the province or city where the people’s credit fund is headquartered during his/her term of office;

(iv) have at least 01 year's experience of working as a manager or executive of a credit institution, or at least 02 years’ experience of working as manager of a finance, banking, accounting or audit enterprise, or at least 03 years’ experience of working directly at finance, banking, accounting and audit departments.

2. For a people’s credit fund whose total assets are worth from VND 200 billion to under VND 500 billion, except the case prescribed in clause 4 of this Article:

a) If a member of the Board of Directors is appointed as the Director, he/she must:

(i) be an individual member of the people’s credit fund;

(ii) possess a bachelor’s degree or higher;

b) If the Director is hired, he/she must:

(i) satisfy the eligibility requirements and standards set out in points b(i), b(ii) and b(iii) clause 1 of this Article;

(ii) Have at least 02 years' experience of working as a manager or executive of a credit institution, or at least 03 years’ experience of working as manager of a finance, banking, accounting or audit enterprise, or at least 04 years’ experience of working directly at finance, banking, accounting and audit departments.

3. For a people’s credit fund whose total assets are worth VND 500 billion or higher, except the case prescribed in clause 4 of this Article:

a) If a member of the Board of Directors is appointed as the Director, he/she must:

Satisfy the eligibility requirements and standards set out in points a(i) and a(ii) clause 2 of this Article;

b) If the Director is hired, he/she must:

(i) satisfy the eligibility requirements and standards set out in points b(i), b(ii) and b(iii) clause 1 of this Article;

(ii) Have at least 03 years' experience of working as a manager or executive of a credit institution, or at least 04 years’ experience of working as manager of a finance, banking, accounting or audit enterprise, or at least 05 years’ experience of working directly at finance, banking, accounting and audit departments.

4. The SBV’s provincial branch shall reach an agreement with the People’s Committee of commune where the people’s credit fund is headquartered, and the cooperative bank on appointment of the Director of the people’s credit fund according to the following provisions:

a) The Director of a people’s credit fund will be appointed if:

(i) The people’s credit fund fails to appoint a qualified Director within the time limit prescribed in clause 3 Article 95 of the Law on Credit Institutions;

(ii) The people’s credit fund is placed under special control; or

(iii) In other cases where such appointment is requested by the SBV’s provincial branch when the people’s credit fund is facing risks which may threaten its safe operation;

b) The person who is appointed as the Director of the people’s credit fund must:

(i) be reputable and have strictly complied with laws;

(ii) possess a bachelor’s degree or higher, or possess an intermediate education diploma or higher (for a commune-level official);

(iii) have at least 01 year’s experience of working as a manager or executive of a banking, finance, accounting or audit entity as certified in the Charter or another document of equivalent validity of this entity, or at least 03 years’ experience of working directly at finance, banking, accounting and audit departments, or be a commune-level official.

Article 23. Eligibility requirements and standards to be satisfied by deputy director(s), chief accountant and branch director(s)

A Deputy Director, Chief Accountant or Branch Director must meet the following eligibility requirements and standards:

1. For a people’s credit fund whose total assets are worth less than VND 200 billion:

a) Be not subject to Article 42 and 43 of the Law on Credit Institutions;

b) Have his/her permanent or temporary residence registered in the province or city where the people’s credit fund is headquartered during his/her term of office;

c) The Chief Accountant must meet relevant eligibility requirements and standards set out in the Law on accounting;

d) Possess an intermediate education diploma, or higher, in finance, banking, business administration, law, auditing or another major relevant to his/her in-charge tasks, or possess a junior college’s degree, or higher, in another major and have at least 03 years’ experience of working directly at finance or banking department or in field relevant to his/her in-charge tasks.

2. For a people’s credit fund whose total assets are worth from VND 200 billion to under VND 500 billion:

a) Satisfy the eligibility requirements and standards set out in points a, b and c clause 1 of this Article;

b) Possess a junior college’s degree, or higher, in finance, banking, business administration, law, auditing or another major relevant to his/her in-charge tasks, or possess a bachelor’s degree, or higher, in another major and have at least 03 years’ experience of working directly at finance or banking department or in field relevant to his/her in-charge tasks.

3. For a people’s credit fund whose total assets are worth VND 500 billion or higher:

a) Satisfy the eligibility requirements and standards set out in points a, b and c clause 1 of this Article;

b) Possess a bachelor’s degree, or higher, in finance, banking, business administration, law, auditing or another major relevant to his/her in-charge tasks, or possess a bachelor’s degree, or higher, in another major and have at least 04 years’ experience of working directly at finance or banking department or in field relevant to his/her in-charge tasks.

Section 6. OPERATIONS OF A PEOPLE’S CREDIT FUND

Article 24. Capital mobilization

1. Receive demand deposits, term deposits, and saving deposits in VND from members of the people’s credit fund, and other organizations and individuals.

2. Total amount of deposits received by a people’s credit fund operating within a commune from its members must equal at least 50% of total amount of deposits it received.

Total amount of deposits received by a people’s credit fund operating within an inter-commune area from its members must equal at least 60% of total amount of deposits it received.

Total amount of deposits received by a people’s credit fund whose total assets are worth VND 500 billion, or higher, from its members must equal at least 70% of total amount of deposits it received.

3. Get loans from the cooperative bank.

4. Get loans from credit institutions and foreign bank branches. A people’s credit fund may not get/grant loans from/to or deposit money at another people’s credit fund.

5. Receive trust funds from domestic organizations and individuals for granting loans.

Article 25. Blank passbooks

1. People’s credit funds may only use blank passbook form issued and provided by the cooperative bank for receiving deposits from its clients as prescribed in clause 1 Article 24 of this Circular.

2. Each people’s credit fund shall:

a) Formulate its internal regulations on management and use of blank passbooks, and send them to the relevant SBV’s provincial branch within 10 days from the date of promulgation or revision. Such internal regulations on management and use of blank passbooks shall, inter alia, include the following contents:

(i) Specific procedures for purchase, management and use of blank passbooks, ensuring strict monitoring of both quantity and quality of blank passbooks during storage, delivery, preservation, transport, management, and use thereof; monthly inventory and comparison; and handling of lost or damaged blank passbooks.  Blank passbooks must be strictly monitored in the same manner as valuable papers and may only be stored at the headquarters of the people’s credit fund.

(ii) Responsibilities of the Board of Directors, Chairperson of the Board of Directors, Director (Deputy Director), Board of Controllers and relevant individuals/departments for management and use of blank passbooks; inspection and comparison of blank passbooks, and handling of lost or damaged blank passbooks;

(iii) Procedures for consideration of responsibility of relevant individuals/departments for management, use and loss of blank passbooks. Immediately after receiving blank passbooks from the cooperative bank, the people’s credit fund shall fan stamp the part delivered to the client and the part kept by the people’s credit fund of every blank passbook, or append its seal to every blank passbook;

b) Submit report to the SBV’s provincial branch and the cooperative bank immediately when it detects the loss of blank passbooks so as to adopt appropriate remedial measures, and post the list of lost blank passbooks in which serial number of each passbook must be specified at its headquarters and transaction office(s), and at the office of the People's Committee of the area where it is operating immediately when it detects the loss;

c) Publicly post the blank passbook form issued or provided by the cooperative bank at its headquarters and transaction office(s) and on the mass media of commune or ward; enable clients who deposit money at the people’s credit fund to compare the passbooks issued to them with the prescribed blank passbook form and to change their passbooks from the old form into the new one;

d) On a monthly basis, return unused blank passbooks to the cooperative bank and open logbook thereof;

dd) By the 10^th day of each month or as requested, prepare a consolidated report on its use of blank passbooks in the previous month using the form in Appendix 05 enclosed herewith, and send it to the SBV’s provincial branch.

Article 26. Lending

1. People’s credit funds grant loans to serve the primary purpose of assisting their members in effectively doing business and improving their living conditions.

2. People’s credit funds grant loans in VND according to SBV’s regulations on grant of loans by credit institutions to their clients, and assume responsibility for their lending decisions. People’s credit funds are not allowed to grant loans which are secured by capital contribution certificates of their members.

3. The people’s credit fund shall consider granting loans to its members that are juridical persons, and juridical persons or individuals other than its members that make deposits to the people’s credit fund on the basis of collateral which is their deposit account balances maintained with the people’s credit fund. In this case, the loan term shall not exceed the remaining validity period of the client’s deposit contract or passbook.

4. In case a poor household is not a member of the people’s credit fund, the people’s credit fund shall consider granting loans to that poor household’s members who have their permanent residence registered in its area of operation. If multiple members of the same poor household apply for loans, they shall jointly sign or authorize one of them to sign the loan agreement with the people’s credit fund. The poor household is the one certified by the district-level People’s Committee. Loan applications and procedures for grant of loans to members of poor households comply with regulations on grant of loans to members of the people’s credit fund.

5. People’s credit funds are not allowed to grant loans to their clients for purchasing or investment in securities,

6. People’s credit funds may cooperate with the cooperative bank in granting syndicated loans to their members in accordance with regulations of law.

Article 27. Internal regulations on lending and loan management

Each people’s credit fund must promulgate its own internal regulations on lending and management of loans in accordance with SBV’s regulations on grant of loans by credit institutions and foreign bank branches to their clients, sorted by its groups of clients, including: its members that are individuals, family households and juridical persons; clients other than its members as prescribed in clauses 3 and 4 Article 26 of this Circular.

Article 28. Other operations 

1. Perform the activities prescribed in clause 3 Article 126 and points b, d, dd, e and h clause 4 Article 126 of the Law on Credit Institutions;

2. Make deposits to the cooperative bank for capital trade-off.

3. Act as an insurance agent according to the following provisions:

a) If the License issued by the SBV to the people’s credit fund includes activities of insurance agent, the people’s credit fund may act as an insurance agent for different types of insurance as prescribed by the Law on Insurance Business;

b) When acting as an insurance agent, the people’s credit fund must strictly comply with regulations of law on insurance business and relevant laws.

Section 7. RIGHTS AND OBLIGATIONS OF PEOPLE’S CREDIT FUNDS

Article 29. Rights of people’s credit funds

A people’s credit fund is entitled to:
1. Receive assistance from the cooperative bank in developing its products/services; organizing professional training.

2. Receive assistance from the cooperative bank in performing banking activities in accordance with regulations of law.

3. Receive assistance from the cooperative bank in conducting internal audits in accordance with SBV’s regulations on cooperative bank.

4. Receive financial aids from the State, domestic and foreign organizations and individuals.

5. Request borrowers to provide documents on their business, services and living conditions used or improved by borrowed funds and other information as prescribed by law.

6. Refuse requests of organizations and individuals which are made against regulations of law.

7. Exercise other rights as prescribed by laws.

Article 30. Obligations of people’s credit funds

A people’s credit fund is obliged to:
1. Do business according to the issued License.

2. Make capital contribution to the cooperative bank in accordance with regulations of law.

3. Make deposits to the cooperative bank for capital trade-off in accordance with SBV’s regulations on cooperative bank.

4. Participate in the Fund for maintenance of prudence of the system of people’s credit funds in accordance with regulations of law.

5. Provide reports to the cooperative bank to serve capital trade-off, inspection, supervision, internal audit, and management of Fund for maintenance of prudence of the system of people’s credit funds as prescribed in the cooperative bank’s internal regulations issued according to SBV’s regulations on cooperative bank.

6. Bear inspection, supervision and internal audit of the cooperative bank in accordance with SBV’s regulations on cooperative bank.

7. Post and retain the information specified in clause 1 Article 49 of the Law on Credit Institutions at its headquarters, and submit reports to the relevant SBV’s provincial branch within 07 working days from the day on which it receives such information. The people’s credit fund shall annually disclose the information specified in points a, b and d clause 1 Article 49 of the Law on Credit Institutions to its GMM.