Legal basis
Law on Credit Institutions 2010
Decree No. 39/2014/ND/CP
Content
Specialized financial companies include factoring finance companies, consumer credit finance companies, financial leasing companies as prescribed in this Decree and the guidance of the State Bank of Vietnam (below: referred to as the State Bank for short).
Factoring finance company is a specialized financial company, mainly operating in the field of factoring according to the provisions of Decree No. 39/2014/ND-CP.
Factoring is a form of granting credit to a seller or a buyer through the acquisition with the right to recourse to receivables or payables arising from the purchase and sale of goods, provision of services under contracts for the purchase and sale of goods and provision of services.
Conditions for factoring operations for factoring finance companies
Firstly, having a team of qualified staff, professional capacity, facilities, technology, means, equipment and internal regulations as prescribed by law to carry out factoring activities. stated in the License.
Second, fully meet the professional conditions for factoring activities prescribed by the State Bank.
Third, the factoring loan balance must account for at least 70% of the total credit balance or another ratio prescribed by the State Bank from time to time.
In addition, the factoring finance company is entitled to perform the activities specified at Points a and e, Clause 1, Article 108 of the Law on Credit Institutions, Articles 6, 7, 8, 11 and Article 14 of Decree 39/2014. /ND-CP when fully satisfying the conditions in this Decree, except for the following activities:
a) Underwriting corporate bonds, buying and selling corporate bonds;
b) Receive capital entrusted by the Government, organizations and individuals to carry out investment activities in production and business projects;
c) Entrust capital to other credit institutions to provide credit.
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