Credit funds to lend helping hand to SMEs
The firms enjoying the credit guarantee funds also includes the SMEs who suffer losses of finance and assets caused by natural disasters and those who go bankrupt in accordance with current law.
Small- and medium-sized enterprises (SMEs) will be aided by credit guarantee funds if a change in State policies results in their failure to pay debt, including principal and interest, on time.
This is a key part of a finance ministry circular guiding the credit guarantee funds’ mechanism of credit risk management for SMEs, which was recently issued.
The firms enjoying the credit guarantee funds also includes the SMEs who suffer losses of finance and assets caused by natural disasters and those who go bankrupt in accordance with current law.
SMEs at risk due to other objective reasons affecting their business activities resulting in failure to pay debts on time are also listed.
The circular will come in to effect on October 15 this year.
The establishment of the credit guarantee funds for SMEs was approved by the Government last year to help firms get credit for production and business.
The funds are set up by the people’s committees of provinces and cities. They operate for non-profit purposes and under the model of one-member limited company with 100 per cent charter capital from the State. The fund must have minimum charter capital of VNĐ100 billion (US$4.3 million). — VNS
