Businesses to get interest rate support from the state budget

The Government has issued Decree 31 on interest rate support from the state budget for loans borrowed by enterprises, cooperatives and business households.

Under the new decree, the interest rate support period will last from the date of loan grant to the date the borrower pays the loan principal and interest as agreed upon between the lender and borrower but must not be later than December 31, 2023.

The interest rate support will be 2 percent a year. Entitled to the interest rate support are enterprises, cooperatives and business households operating in the sectors of aviation, transport and warehousing; tourism; accommodations, food and beverage services; education and training; agriculture, forestry and fisheries; processing and manufacturing industries; software publication; computer programming; and information services; or using loans for projects on construction of social houses or houses for workers, or upgrading old condominiums on the list announced by the Ministry of Construction.

 The new regulation also sets several other conditions for receiving the state budget’s interest rate support.

 Specifically, borrowers are required to meet the loan conditions in accordance with the current law on lending activities of credit institutions and foreign bank branches and use loans for proper purposes.

 Preferential loans must be granted in VND with loan agreements signed and implemented during the period from January 1, 2022, to December 31, 2023.

 Under the Decree, commercial banks will stop providing interest rate support after December 31, 2023, or when the funding sources (interest rate limits) are used up.

 (Source:VLLF)