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THE MINISTRY OF
AGRICULTURE
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SOCIALIST
REPUBLIC OF VIET NAM
Independence - Freedom - Happiness
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No:
13/1999/QD-BNN-CS
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Hanoi, January
16, 1999
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DECISION
PROMULGATING THE AMENDED REGULATION ON CREDIT AND SAVINGS
THE MINISTER OF AGRICULTURE AND RURAL DEVELOPMENT
Pursuant to Decree No.73/CP of November 1st,
1995 of the Government on the functions, tasks, powers and organizational
structure of the Ministry of Agriculture and Rural Development;
Pursuant to the Decision on the establishment of the Management Board of
Vietnam- Sweden Program for the Development of Mountainous Rural Regions of
February 12, 1996;
At the proposals of the head of the Department for Agriculture and Rural
Development Policy, the manager of the project for enhancing the Ministrys
consulting capability and the executive manager of the Boards Office;
DECIDES:
Article 1.- To issue
hereby the amended Regulation on Credit and Savings applicable to the Vietnam -
Sweden 1996-2000 Program for the Development of the Mountainous Rural Regions.
Article 2.- This
Decision takes effect 15 days after its signing. All previous project documents
contrary to this Regulation are now no longer effective.
Article 3.- The managers
of the projects on development of the mountainous rural regions of Lao Cai, Yen
Bai, Ha Giang, Tuyen Quang and Phu Tho provinces, the project for enhancing the
Ministrys consulting capability, the Programs executive manager and the
director of the Ministrys Office shall have to implement this Decision.
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FOR THE MINISTER OF
AGRICULTURE AND
RURAL DEVELOPMENT
VICE-MINISTER - HEAD OF THE MANAGEMENT BOARD OF VIETNAM-SWEDEN PROGRAM FOR
DEVELOPMENT OF MOUNTAINOUS RURAL REGIONS
Nguyen Quang Ha
REGULATION (AMENDED)
ON CREDIT AND SAVINGS
(Issued together with Decision No.13/1999/QD-BNN-CS of January 16, 1999 of
the Minister of Agriculture and Rural Development)
Part I
GENERAL PROVISIONS
Article 1.- The
purposes of credit and savings activities
The activities of providing credit and savings
services, training and seminar services, which are included in the contents of
the rural financial service (hereafter abbreviated as RFS contents) in the
Vietnam-Sweden Program for the Development of Mountainous Rural Regions
(hereafter referred to as the Program for short) aims at:
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2. Providing in a quick, timely and convenient
manner the credit and savings services for family households to develop
production and business.
3. Enhancing various managing levels capability
to effectively manage the Programs credit capital sources.
4. Building and developing the Programs credit
and savings groups into rural financial institutions after the Program
concludes, thus contributing to the socio-economic development.
Article 2.- The scope
of application
This Regulation shall apply to all activities related
to the RFS contents, the Office of the Program Board, the ministerial projects,
the provincial projects, the district project management boards, the commune
project management boards and credit and savings groups. Joint programs with
financial/credit/banking organizations shall be effected under separate
agreements reached between the Program and such organizations.
Part II
ORGANIZATION AND
MANAGEMENT
Article 3.-
Organizational structure
The development support for RFS activities shall
be rendered through the Program Boards Office, the ministerial projects and
five projects of the provinces of Phu Tho, Tuyen Quang, Yen Bai, Ha Giang and
Lao Cai.
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a) 4 levels: provincial, district, commune and
credit & saving group; or,
b) 3 levels: provincial, district (or commune)
and credit & savings group; or
c) 2 levels: provincial and credit & savings
group.
Article 4.- The head of
the Program Managing Board
The head of the Program Managing Board shall, on
behalf of the Ministry of Agriculture and Rural Development, sign for
promulgation the Programs credit and savings policies; and conclude cooperation
agreements with other agencies and organizations.
Article 5.- The Programs
executive manager
The Programs executive manager shall organize
and coordinate the operations of the MILS management and supervision
information system of the RFS contents.
Article 6.- The
ministerial projects manager
The manager of the project on enhancing the
Ministrys consulting capability the deputy-head of the Department for
Agriculture and Rural Development Policy shall have the following functions and
powers:
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2. To monitor the implementation of already
promulgated policies and regulations and propose necessary adjustments and
amendments thereto;
3. To proceed with projects on cooperation with
the State financial bodies as well as other agencies and organizations;
4. To draw up RFS training programs;
5. To coordinate with provincial projects in
organizing the training of personnel for provincial projects and further projects
on cooperation with the State financial organizations.
6. To organize the training and
certificate-granting tests for members of the Management Boards of grade-II
groups.
Article 7.- The
provincial projects manager
The provincial projects manager shall have the
following functions and powers:
1. To manage and preserve the allocated capital
sources;
2. To disburse capital and recover loan capital;
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4. May authorize heads of district project
management boards to manage part or whole of the projects credit capital,
evaluate and approve loans, recover loan capital with regard to the allocated
credit capital;
5. To ratify the evaluation and classification
of credit and savings groups submitted by districts, bank branches and
organizations for cooperation with the Program, which are headquartered in the
locality;
6. To manage, examine and supervise comprehensively
all credit and savings activities of the Program in the province;
7. To submit quarterly reports to the Program
Managing Boards Office through the MILS system;
8. To organize RFS training for members of the
management boards of the provincial, district and commune projects as well as
the management boards of credit and savings groups.
Article 8.- The Head of
district project’s management board
The head of the district project management
board, besides the task of performing partly or fully the work authorized by
the provincial project managers as defined in Article 7.4 of this Regulation,
shall have the following tasks:
1. To participate in the implementation and
guide the management boards of commune projects and credit and savings groups
in the implementation of this Regulation;
2. To manage, inspect and supervise
comprehensively the Program’s credit and savings activities in the locality;
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4. To classify credit and savings groups in the
locality and submit them to the provincial project managers for official
ratification.
Article 9.- The head of
the commune project management board
In communes where exist many credit and savings
groups, the head of the district project management board shall authorize the
head of the commune project management board to coordinate activities of the
credit and savings groups in the commune. In all circumstances, the head of the
district project management board must not authorize the head of the commune
project management board to run the credit and savings management operations of
the credit and savings groups.
Article 10.- The head
of the credit and savings group management board.
The head of the credit and saving group
management board shall be elected by the group members congress and have the
following functions and powers:
1. To represent the group in its transactions
with the management boards of the commune/district/provincial projects;
2. To prepare agenda for, convene and preside
over the groups meetings.
3. To implement the Programs regulations on
credit and savings as well as the groups statute.
4. To make monthly reports and submit them to
the commune/district/provincial project management boards.
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Article 11.-
Relationship with other agencies and organizations
1. The relationship with the commune Peoples
Committees
The commune Peoples Committee shall play the
role of State management over the activities of the credit and savings groups
in the locality, supervising their activities and certifying loan applications
to ensure that the borrowers are lawful inhabitants in the commune and have
full legal status; the commune Peoples Committee shall not directly participate
in running the professional affairs of the credit and savings groups.
The credit and savings groups shall have to
register their operations with the commune Peoples Committees. The groups
statutes and lists of group members must be certified by the commune Peoples
Committees.
2. The relationship with mass organizations as
well as social and professional organizations.
The projects should step up relations with mass
organization as well as social and professional organizations so as to ensure
the efficient utilization of the Programs credit capital sources as well as the
participation of women, families headed by women and people of ethnic
minorities.
3. The relationship with State financial bodies
and organizations.
Projects jointly managed by the Program and
State financial bodies and/or organizations shall comply with the agreements
concluded between the Program and such bodies and/or organizations.
Part III
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Article 12.- The
organizational structure of the credit and savings group
1. The concept of the credit and savings group
The credit and savings group is an organization
of family households that reside and lawfully practice jobs in a commune,
volunteer to join the group to practice thrift, borrow the Programs capital for
production, business and service development with a view to improving their
living conditions, eliminating hunger and alleviating poverty. Each credit and
savings group has its own statute which is certified by the commune Peoples
Committee and specifies the group’s operations .
2. The congress of the credit and savings group�s members
The highest organ of authority of the credit and
savings group is its members congress which is held annually after each year of
its operation or irregularly at the request of at least 2/3 of the group�s members.
The congress shall approve the groups statute,
elect the management board, amend the statute, re-elect the management board,
approve the financial settlement, decide the admission of new members, approve
the leaving of the group by members and settle other things as prescribed in
the groups statute.
A resolution of the credit and savings group
shall be passed according to the principle of majority by at least 2/3 of the
total number of the group members.
3. The groups management board
The groups management board is elected by the
members congress with the following titles: The group leader, the chief
accountant and the cashier. The management board shall have the following
functions and tasks:
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b) To supervise the use of loan capital by
members;
c) To receive and evaluate loan applications;
d) To make lists of borrowers and credit
contracts with projects and/or members;
e) To join the provincial/district project
management boards in distributing loan capital to borrowers;
f) To collect loan interests and support
projects in the retrieval of loan capital;
g) To collect and manage savings money of the
group members;
h) To effectively manage the groups capital and
funds;
i) To arrange and record in writing all meetings
of the group;
j) To make and submit monthly reports to the
commune/district/provincial project management boards;
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The group management board shall also have other
powers and duties prescribed in the group�s
statute.
4. Conditions for credit and savings group
membership
Citizens aged full 18 upwards, have full
capacity for civil acts, are representatives of family households residing and
practicing jobs in the area and volunteer to join credit and savings groups
shall be their members.
The group members shall have to fulfill the
following obligations:
a) To use the loan capital for the right
purposes;
b) To fully contribute the obligatory savings to
their respective groups;
c) To establish cooperation on the principle of
equality, mutual benefits, mutual assistance and of ensuring the groups common
interests;
d) To compensate for damage caused due to their
own faults;
e) Group members bear equal joint responsibility
for loan capital from the Program;
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The group members shall have the following
rights:
a) To have equal access to the credit capital
sources from the Program;
b) To attend refresher and training courses
sponsored by the Program;
c) To join in making decisions on matters
related to their groups activities and inspect the groups activities;
d) To elect or stand for the election to the
group management boards;
e) Other rights prescribed by the group’s
statute.
5. The credit and savings teams
Credit and savings groups with large membership
may be divided into various teams.
According to the groups statute, each credit and
savings team shall elect its leader who shall represent the team in a number of
transactions between members and the group management board as prescribed by
the groups convention. The group leader may authorize a team leader to receive
savings and/or collect interests on capital loans of the group and the Program
from the members and remit them to the group management board. In all
circumstances, the group leader must not authorize the team leader to collect
credit loans of the Program and perform such spending tasks as lending capital,
paying savings and/or interests thereon or to sign on behalf of the group
leader the capital-borrowing contracts of the members.
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a) Assisting members to draw up production and
business plans and fill the procedures for capital borrowing.
b) Considering and evaluating loan applications
of members.
c) Helping one another to use the borrowed
capital with high efficiency;
d) Helping members who are confronted with
risks.
e) Collecting and remitting savings and
collecting interests on loans;
f) If a member is unable to pay back a loan, the
whole team shall have to pay it for him/her.
Article 13.- The credit
and savings groups statute
Each group shall have to elaborate its own
statute (cooperation contract), which specifies the duties and rights of the
group members, the group management board as well as the civil liability of the
group. Such a statute must include the following main contents:
1. The groups property
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For class-I credit and savings groups as prescribed
in Article 15 of this Regulation, the groups property shall not include the
interests on loans of the Program, which have been retained to increase the
groups fund.
For credit and savings groups of classes II and
III as prescribed in Article 15 of this Regulation, the groups property shall
include the interests on the Programs loans, which have been retained to
increase the groups fund.
2. The groups representative
The group leader shall represent the group in
its civil transactions. He/she may authorize group members to perform certain
tasks necessary for the group as prescribed in the groups statute.
3. The groups civil liabilities
a) The group shall have to bear civil
liabilities for the performance of civil duties established and performed by
the groups representative in its own name;
b) The group shall have to bear the
responsibility for the groups common debts and other civil liabilities with its
property. If the groups common property is not enough for the performance of
the common duties of the entire group, the members shall have to jointly bear
the responsibility.
4. The admission of new members
The group shall admit a new member when it is so
agreed by at least 2/3 of its members. Any persons wishing to join the group
shall have to file application and accept the groups statute as well as the
Programs regulations.
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a) Members are entitled to leave their credit
and savings groups after fulfilling the obligations to the group and the
Program.
b) Members shall be compelled to leave their
groups if they break the commitments made upon their participation in their
groups and/or violate regulations of the Program as well as the statute of the
group.
c) The group leavers shall have to fulfill all
their obligations to their respective groups and the Program;
d) Members are entitled to request the return of
their contributions after fulfilling relevant obligations.
6. Termination of the groups operation
The group shall terminate its operation in the
following cases where:
a) Its operation duration stated in the statute
has expired;
b) The members agree to terminate the operation
which has proved not beneficial to them.
Upon the termination of its operation, the group
shall have to pay all its debts to the Program and other organizations. If its
common property is not enough to pay debts, the members private property shall
be used for debt payment. The group shall have to report in advance to the
project and the local Peoples Committee which has certified the statute of the
credit and savings group on the decision to terminate its operation.
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1. A credit and savings group shall have the
following revenues and expenditures :
Its revenues shall include:
a) Revenues for deposit interests;
b) Earnings from loan interests;
c) Other revenues.
Its expenditures shall include:
a) Payment of interests on savings of the
members;
b) Payment of profits to the project;
c) Payment of renumeration to the group
management board;
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e) Expenses for setting up the groups funds;
f) Deductions for setting up the groups risk
fund.
2. The groups capital sources and the use
thereof:
Types of capital sources
a) Source of loan capital from the Program;
b) Sources of mobilized savings and contributed
shares of members;
c) The Programs profits retained to increase the
groups fund as prescribed in Article 20.a of this Regulation
d) Sources of risk fund;
e) The undivided profits.
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a) Loan credit balance;
b) Cash left at the fund.
c) Deposits at banks, treasuries or the
higher-level project management boards.
The accounting of the groups revenues,
expenditures, capital source and the use thereof, funds and the use thereof
shall comply with the unified accounting regime of the Program.
Article 15.-
Classification of credit and savings groups
Annually, the provincial projects shall have to
classify the credit and savings groups according to the following criteria:
Class-I group:
a) Having the statute certified by the commune
Peoples Committee; having the group management board elected by group members,
and
b) The management board has been given training
in the group management by the Program.
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The class-II group shall have to meet the
criteria of class I group and have other criteria on group management
experience, the sustainability of its own capital in two consecutive years by
the time the group classification is made. The concrete criteria are as
follows:
1. The group has not breached this Regulation
and other stipulations and legislations;
2. The leader, the chief accountant and the
cashier of the group have fully attended training courses, passed all
examinations and been granted the class-II group management certificate.
3. The groups property by the time of
classification has a value which is bigger than 25% of the capital borrowed
from the Program at the peak time in the two years close to the classification
time.
4. The savings contributed by members have at
least reached the average of 120,000 dong per head by the time of
classification;
5. The ratio of the overdue debts to the total
debts by the time of classification shall not exceed 5%;
6. The reports on management have been completed
and submitted to the higher-level project management board on schedule.
7. The classification has been approved by the
project manager.
Class-III group:
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Part IV
LENDING
Article 16.- Lending
purposes
The Program shall provide family households in
the project regions with capital for use in project of high technical
feasibility and socio-economic efficiency in order to develop the mountainous
countryside, thus contributing to hunger elimination and poverty alleviation in
localities of the project regions.
Article 17.- Conditions
for capital borrowing
Loans provided from the Project shall not
require the property mortgage by the borrowers. Those family households that
are members of the Programs credit and savings groups and meet the following
conditions may borrow credit capital from the Program:
1. Accepting the Program�s regulations and the groups statute;
2. Being capable of using and refunding the loan
capital;
3. Submitting loan application-cum-plan for
production and business activities (according to set form of the Program).
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5. With at least 2/3 of the group�s members having agreed on
the lending.
Article 18.- Lending
term
The lending terms shall not exceed 12 months for
short- term loans and 24 months for medium-term loans. The specific term for
each loan shall comply with the production and/or business cycle and the
borrowers debt-paying capability. Loans used for the purpose of production and
business development shall be ratified by the provincial project mangers on the
case by case basis.
Article 19.- Lending
interest rate
The interest rate on the Programs loans lent to
members of credit and savings groups applicable to all provincial projects
shall be 1.0%/month. The Ministry of Agriculture and Rural Development shall
issue specific notice to the provincial projects when this interest rate is
adjusted.
The interest rate on loans from the groups
capital funds (savings deposit, contributions from members, deductions from
interests on loans from the Programs capital sources as prescribed in Article
20.a of this Regulation) shall be decided by the credit and savings groups but
must be higher than the interest rate on the members savings deposits and not
exceed the ceiling lending interest rate in the countryside as provided for by
the State Bank of Vietnam, applicable to the Peoples Credit Funds, which is
1.5%/month at present.
Article 20.- Division
of profits from interests on the Programs capital loans.
The profits earned by the credit and savings
groups from the Programs capital loans shall be split according to the
following ratio:
a) 55% shall be fuelled into the groups fund.
The credit and savings group shall be fully entitled to use this sum as loans
to its members and shall have to refund it to the Project. When a credit and
savings group reaches the class-II level, this deduction amount shall belong to
its ownership.
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c) 5% shall be reserved for setting up the group�s risk fund which shall be
used to support group members in the event of risks. The support level shall be
prescribed by the group’s statute. If the risk fund remains temporarily idle,
the group may deposit it as demand savings at a bank or the State Treasury.
d) 15% shall be remitted to the district and
provincial project management units. The provincial project manager shall
specify in writing the purposes and levels of spending from this sum for activities
related to the management of the Project�s
credits and savings.
Article 21.- Division
of profits earned from the interests on the group’s capital loans.
The division of profits earned from the
activities of lending of capital from the group�s
self-created fund (savings deposits, shares of members, deductions from
interests on the Program�s
capital loans for establishment of funds, risk fund) shall be decided by the
group itself.
Article 22.- Lending
levels and loans for business development
a) The lending level: The total amount of loans
lent to each group member shall not exceed 2.5 million VNdong.
b) Loans for business development: Every loan
exceeding 2.5 VNdong must be applied for in writing directly to the Project by
the borrower. The Project’s maximum business development loan amount provided
for a member household of the group shall be 10 million VNdong. The
capital-borrowing dossiers submitted by the borrower must be evaluated by the
group before it is transferred to the Project for the final appraisal, then the
approval and the signing of a loan contract.
Article 23.- The
capital-lending dossiers
The Program issues together with this Regulation
documents related to the procedures for capital borrowing, loan capital
consideration and approval, debt payment prolongation, overdue debt transfer,
including the following forms:
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2. The loan appraisal record: made in two copies
by the group, with one copy being kept at the group and the other sent to the
Project.
3. The loan notice: made in two copies by the
Project, with one copy being kept at the Project and the other sent to the
credit and savings group.
4. The credit contract: made in two copies, with
one being kept by the borrower and the other by the lender.
5. The record on the inspection of the use of
loan capital: made in two copies, one is kept by the project and the other by
the group.
6. The debt prolongation application: made in
one copy and sent to the lender by the borrower.
7. The debt prolongation notice: made in two
copies by the Project, one is kept by the Project and the other by the group.
8. The overdue debt transfer notice: made in two
copies by the project, one is kept by the Project and the other by the group.
Besides, the spending acknowledgement papers
must be issued when loans are provided or the money receipts must be issued
when debts are collected; such spending acknowledgement papers and money
receipts shall be kept together with other documents related to each loan.
The dossier-keeping principle: The lender, the
project or the group, shall have to keep the lending dossiers which must be
safely kept like money and easily to find and to get.
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The loan appraisal and approval process
prescribed below shall be commonly applied to loans provided from the Programs
capital source for credit and savings group members.
1. Appraisal
The provincial project manger shall have to
appraise capital-borrowing applications before they are approved. The contents
to be appraised shall include:
a) The use purposes of the loan capital;
b) The possibility to recover the loan, both the
principal and the interest.
If the provincial project manager authorizes the
head of the district project management board to appraise the loan, the loan
appraisal shall be made by the latter.
2. Loan approval
Basing him-/herself on the result of the
borrower’s application, the provincial project manger shall sign to approve the
loan. If the provincial project manager authorizes the head of the district
project management board to approve the loan, the latter shall sign to approve
the loan.
3. Time limits for loan appraisal and approval
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b) Within 07 days after the project manager/the
head of the district project management board receives the dossiers of loan
application, a notice on loan approval or disapproval must be sent to the
concerned credit and savings group leader who shall have to inform the relevant
member of his/her group thereof.
Article 25.- Capital
disbursement
Basing him-/herself on the approved loan
dossier, the project manager/the head of the district project management board
shall notify the group of the time and place for capital disbursement 7 days in
advance so that the group shall inform the members eligible for loans thereof.
The project officials shall have to directly hand the money to such members.
Article 26.- Loan
refunding
1. The responsibility to refund loans
The borrower shall have to refund the loan fully
with the principal and the interest on time as already committed in his/her
application as well as the loan contract; he/she may return the debt ahead of
time.
2. Debt and interest-paying modes
For medium-term loans, the borrowers may pay
their loan debts in installments monthly, quarterly, biannually and annually as
agreed upon.
The borrowers may repay their loan debts and
interests through the credit and savings group management boards or directly to
the project.
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Article 27.- Debt
prolongation
The borrower shall have to make the application
for debt prolongation according form 06/TD set by the Program and send it to
the provincial project manager at least 15 days before the due date stated in
the loan contract. The provincial project manager shall decide the debt
prolongation on the case by case basis. The prolongation duration for each loan
shall not be longer than half (1/2) of the lending term. If the project manager
refuses to prolong the debt payment, the debt applied for payment prolongation
shall be turned into overdue debt.
Article 28.- Handling
of overdue debts
A loan shall be considered an overdue debt when
the loan principal payment deadline stated in the contract (including the
period of debt prolongation) has already expired for one day or more. Where a
borrower delays the payment of loan principal, he/she shall be subject to a
penalty interest rate equal to 150% of the prescribed lending interest rate
from the date the loan is turned into overdue debt.
30 days after the expiry date, if the borrower
still fails to pay his/her overdue loan debt and interests thereon, the group
shall have to use its own capital or its members’ savings to pay such overdue
debt for the borrower; if it is still not enough the group members shall have
to make contributions to pay debt for such default borrower.
If the group remains unable to pay the loan debt
to the Project 90 days after the expiry date, the credit capital allocation to
the group shall be suspended.
If the value of the credit and savings group�s debts which have become
overdue for more than 30 days exceeds 10% of the group�s total debt balance, the group shall have to
suspend its lending activities. The provincial project manager/head of the
district project management board shall quickly proceed with the investigation.
If the group fails to make rectification and its overdue debt balance exceed
30% of the loan debt balance and the payment time limit has expired for more
than 60 days, the Program shall withdraw the credit fund from the group.
If the borrower has deliberately used the loan
capital for the wrong purpose(s), thus leading to the overdue debt, the objects
bought with the loan capital shall be collected for handling; depending on the
seriousness of the violations, the provincial project manager/head of the
district project management board shall initiate a lawsuit according to law.
Article 29.- Handling
irrecoverable debts
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If the borrower has deliberately used the loan
capital for the wrong purpose(s), thus leading to overdue debt, his/her loan
capital shall be withdrawn, and depending on the seriousness of the violations,
the provincial project manager/head of the district project management board
shall initiate a lawsuit according to law.
Part V
PROVIDING LOANS TO
MEMBERS THROUGH THEIR CREDIT AND SAVINGS GROUPS UNDER THE CONTROL AND
SUPERVISION BY THE PROJECT
Article 30.- Conditions
for loan provision to member households through groups.
Those credit and savings groups that meet the
following conditions may be selected by the Project manager for loan provision
to member households via groups:
1. Having the groups statute clearly stating the
joint responsibility of all group members for the capital amount borrowed from
the Programs capital sources;
2. The group�s
management board is elected by members;
3. The management board members have been
trained in and are capable of implementing, the regulations of the Program and
the Project on the management of credit and savings activities.
Annually, the projects shall, based on the
above-said criteria, select qualified groups for the application of this
lending mechanism.
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Loans from the projects shall not require the
property mortgage by groups. Those credit and savings groups which meet the
following conditions may borrow credit capital from the Program:
1. Accepting the regulations of the Program and
having the group’s statute;
2. The group members are capable of using the
loan capital for the right purposes and refunding the loan capital;
3. The group members voluntarily apply for loans
and the group makes a written request for loan capital, based on the production
and/or business plans of such members. The group shall have to evaluate and
select capital-borrowing requests of members.
4. The group and its members have been cleared
of overdue loan debts of the Program;
5. All the group members agree with the record
on the loan evaluation and selection by the group.
The lending terms, the lending interest rates,
the division of profits from the interests on loans from the Program’s capital
sources, the division of profits from the interests on loans from the groups� capital sources, and the
lending levels: Similar to those in Articles 18, 19, 20, 21 and 22 of this
Regulation.
Article 32.-
Capital-borrowing dossiers
1. The documents related to the procedures for
capital borrowing, loan consideration and approval, the debt prolongation, the
transfer of members loans into overdue debts are similar to those prescribed in
Article 23 of this Regulation.
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a) The group’s loan application: made in one
copy and sent to the Program.
b) The record on loan consideration and
selection made in two copies with one being kept by the group and the other by
the Project.
c) The lending notice, made in two copies, with
one being kept by the Project and the other by the group.
d) The credit contract on lending to the group:
made in two copies, with one being kept by the Project and the other by the
group (the credit contract on the group�s
lending to member households, shall be made in two copies, with one copy being
kept by the concerned member and the other by the group).
3. The record on inspection of the use of loan
capital, the application for debt payment prolongation, the notice on transfer
of loans into overdue debts shall comply with forms prescribed in Article 23 of
this Regulation, but shall be made between the group and the project, and each
side will keep one copy.
Article 33.- Loan
evaluation and approval procedures
1. The loan evaluation and approval procedure:
a) The group management board shall evaluate
loan applications of members according to the applications contents ;
b) The group meets, publicly evaluating members
qualified for the loan, the loan amount and the lending term. The results of
the group meeting and evaluation shall be included into the evaluation record
and sent to the Project for use as basis for loan approval.
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2. Where a group is organized into various
credit and savings teams, the groups statute may stipulate the prior evaluation
and selection of the members loan applications by the teams themselves and the
records thereon shall be sent to the group management board. The group
management board and team leaders shall conduct the second-round evaluation of
the loan application and scrutinize the teams evaluation records for their
synthesis into the group’s evaluation record which shall be sent to the project
for use as basis for loan approval.
3. The time limit for loan evaluation and
approval
The time limit for loan evaluation and approval
is similar to that prescribed in Point 3, Article 24 of this Regulation.
4. In cases of necessity, the project may
re-evaluate a number of loan proposals.
Article 34.-
Disbursement of capital
Basing him-/herself on the approved loan
dossiers, the Project manager/head of the district project management board
shall inform the group of the time and place for capital disbursement 7 days in
advance so that the latter may inform members who are entitled for loans thereof.
The project officials shall have to hand over the money to the group management
board right at the group office. The group management board shall have to
disburse such sum of money to the concerned members to the witness of the
Projects officials. Within one day after receiving the loan sums from the
Projects officials, the group management board shall have to complete the
capital disbursement and report it to the Project according to the set form of
capital disbursement report.
Article 35.- Refunding
loan capital.
1. The responsibility to refund the loan
capital
The group shall have to refund the loan capital
and pay the interests thereon fully and on time to the Project as committed in
the loan application and the credit contract. The group can pay loan debts
ahead of time. The group shall have to promptly remit the loans and interests
thereon after its members pay to the group.
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The group leader shall have to notify the dates
for regular collection of loan debts and interests thereon to the group members
and the project shall send its officials to the group periodically for the
collection of the loan principals. The group leader shall have to collect the
loan interest and remit it to the Project or the Project shall send its
officials to receive the money at the group. The group members may repay their
medium-term loan debts in installments monthly, quarterly or biannually. The
group members shall not repay their loan debts directly to the Project but repay
them through the group management board.
Article 36.- Debt
prolongation, handling of overdue debts and bad debts
The debt prolongation, the handling of overdue
debts and the handling of bad debts with regard to the group�s loans from the Project shall
comply with the provisions of Articles 27, 28 and 29 of this Regulation.
Part VI
SAVINGS
Article 37.- Savings of
different kinds
1. The compulsory savings
The credit and savings group members shall have
to make compulsory savings according to the group�s
statute which prescribes the savings deposit amount and the deposit term, but
the minimum regular savings deposit amount shall be 5,000 VNdong/month. If a
group does not stipulate the regular savings payment by its members, it may
stipulate the lump sum savings payment by its members with the minimum sum of
60,000 VNdong. When leaving the credit and savings group a member shall be
entitled to take back his/her compulsory savings only if he/she has fully
repaid his/her debts to the group and the Program, including the deduction for
the settlement of responsibility which he/she has jointly borne with other
members.
2. The voluntary savings
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Article 38.- The
interest rate on savings deposits
The savings interest rates paid by the group to
the depositors shall be decided by the groups themselves but must not be higher
than the Program�s
lending interest rates.
Part VII
ACCOUNTANCY, AUDITING
AND REPORTING
Article 39.-
Accountancy regime
The provincial project shall have to abide by
the uniform accountancy regime of the Program, including the accounting regime,
the system of account books and vouchers.
Article 40.-
Inspection, auditing and reporting
1. Inspection
The provincial projects shall have to biannually
inspect the credit and savings activities of the credit and savings groups. The
inspection shall cover the following contents:
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b) The observance of the groups statute;
c) The observance of the accounting and
financial accountancy regime of the group;
d) The use and keeping of dossiers on credit and
savings;
e) The cash fund safety.
All inspection results must be recorded in
writing and summed up into reports to be sent to the Programs Office through
the MILS system.
2. Auditing
All organizations engaged in the RFS activities
at the central, provincial, district, commune and/or credit and savings group
levels shall have to make the financial reports in service of the independent
auditing once every year.
3. Reporting
The higher-level project management boards shall
have to assist their subordinates to fulfill the reporting regime.
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The district-level report must be compiled from
reports submitted by the credit and savings groups; and the district level
shall quarterly report to the provincial level.
The provincial projects shall quarterly submit
MILS reports to the Program Board�s
Office, and such reports have been summed up from the reports submitted by the
districts.
Part VIII
IMPLEMENTATION
PROVISIONS
Article 41.- The responsibility
of the levels that manage the rural financial services
1. The Program Board’s Office
To help coordinate the advisory group with the
provincial projects in implementing this Decision; to organize and implement
the reporting regime according to the MILS system and sum up the entire program
for reporting to the Program Board and SIDA.
2. The provincial projects
To guide and supervise the implementation of
this Regulation by the district/ commune project management boards as well as
the credit and savings group management boards in the provinces.
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To sum up the situation on the implementation of
this Regulation by the provincial projects for reporting to the Ministry of
Agriculture and Rural Development.
Article 42.- Conclusion
of the Program
By the time the Program concludes, the
provincial project managers shall have to carry out procedures for settlement
of accounts and clearly state the loan debt balance, the fund cash remainder
and report them to the functional bodies, and the Peoples Committees of the
provinces involved in the Program shall decide the settlement of existing
problems related to the Programs credit capital sources in the provinces.