BANK MAY CONSIDER DISBURSING LOAN FUNDS IN CASH IN 2 CASES
On December 29, 2017, the State Bank of Vietnam issued the Circular No. 21/2017/TT-NHNN on loan disbursement methods of credit institutions and branches of foreign banks.
Accordingly, the lending credit institution may consider disbursing loan funds in cash in 2 cases: The borrower makes payment to a beneficiary who fails to have a checking account opened at the payment service provider; The borrower, who is also the beneficiary, fails to open a checking account o at the payment service provider but has advanced money from the borrower's equity to pay/cover expenditures for the business plan/project or the plan/project serving personal life approved by the lending credit institution...
In order to disburse loan funds in cash, the borrower must provide the lending credit institution with the beneficiary's written commitment, which indicates that the beneficiary has no checking account opened at the payment service provider.
Also in accordance with this Circular, the lending credit institution may consider deciding to disburse loan funds by either non-cash payment or cash payment service in 2 following cases: The borrower makes payment to the beneficiary that has the checking account opened at the payment service provider provided that the loan amount specified in the loan agreement shall not exceed VND 100,000,000; The borrower makes payment to the beneficiary that is a state-owned organization entitled to receive payments in cash in accordance with regulations of the State Bank of Vietnam.
This Circular takes effect on April 02, 2018.
