A member of staff introduces a customer to consumer loans of FE Credit Company. (Photo: vneconomy.vn)Thedecision was made in the Governor’s written response to questions from aNational Assembly delegate on banking activities after the media reportedsome individuals and companies have recently set up and advertised unlicensedloan apps and websites that have affected the interests of consumers.
Accordingto Hong, the SBV has also received a request to cooperate in providinginformation to the Police for fraud and companies that violate the law.
TheGovernor said the SBV had directed its branches in provinces and cities toproactively report and propose to the municipal and provincial People'sCommittees measures to prevent fraud, stopping individuals and companies fromcarrying out or advertising banking products and services without gettinglicences from the SBV.
Accordingto the Governor, consumer loans play an important role in socio-economicdevelopment as they improve the quality of life for people through theprovision of credit to promote consumption. The increase in consumerdemand will help promote production and create more job opportunities,making a positive contribution to economic growth.
Sharingthe same view, economist Vu Dinh Anh said in the context of declining incomesdue to the pandemic, consumer lending is an important factor tostimulate domestic aggregate demand through a rise in retail andconsumption. There will be a large number of people who need this type ofconsumer finance to enable them to fulfil needs and stabilise their lives.
Consumercredit is often used to describe an unsecured or collateralised loan to supportfinancial resources to meet consumers’ needs such as housing, transportation,living facilities, study, travel and healthcare before they can afford it.
Comparedwith usury from unreliable sources, consumer loans from credit institutionswill be a better and safer choice for consumers. However, experts noted whenhaving access to credit, consumers need a written consumer loan contract, theform and minimum contents of which are specified in the State Bank of Vietnam’sCircular 43/2016/TT-NHNN dated December 30, 2016, to protect their interestsand avoid undesirable consequences.
Sixteenfinance companies are licensed to provide consumer lending with total chartercapital worth more than 22 trillion VND (948 million USD). Those with thelargest charter capital include FE Credit (7.32 trillion VND), SBICFinance (2.53 trillion VND), EVN FC (2.5 trillion VND), Home Credit (2.05trillion VND) and HD Saison (1.4 trillion VND).
Anumber of banks have launched finance companies, such as VP Bank with FECredit, HDBank with HD Saison, SHB with SHB Finance and MBBank with Mcredit.
Bankingexpert Can Van Luc said Vietnam’s consumer credit market had significantpotential for development. Consumer loans are estimated to account for around18-20 percent of the total outstanding loans in the economy./.
VNA
