The SBV stressed that abuse by individuals or organizations of the P2P lending platform for capital mobilization is illegal.
The State Bank of Vietnam (SBV) warned the form of peer to peer lending (P2P), under which lenders and borrowers connect via apps, is being exploited for money lending at sky-high interest rates, far exceeding the ceiling rate of 20% per year pstipulated in the Civil Code.
Recently, Vietnam has witnessed a growing number of companies proving P2P service. Under current laws, only credit institutions have the right to mobilize and lend capital. This means that P2P is still outlawed and poses high risks for customers as it is not under the state’s control. The SBV has not licensed any company in the field.
Moreover there remains unclear about the profit and risks for concerning parties involved in this lending model, according to the SBV. In case of dispute, lenders may lose their money, as P2P companies are not bound to ensure the rights of users.
The SBV also pointed to potential threats of leaking privacy data, cyberattack, lending used for money laundering and tax evasion.
In some cases, P2P companies are using its platform as a way of mobilizing capital with high interest rates, known as multi-level marketing.
The SBV stressed that abusing the P2P lending platform for capital mobilization by individuals or organizations is illegal.
The act of mobilizing capital through credit institutions must follow the Law on Credit Institutions and Law on the State Bank of Vietnam. However, the online P2P lending is considered civil transaction and out of the jurisdiction of those two laws.
The SBV warns citizens and enterprises to remain cautious about participating this lending platform, while encouraging people to access capital through the banking channel.
Additionally, the SBV is working with relevant government agencies for a legal framework managing the P2P lending and new transaction model on digital platform.
Illustrative photo.
|
Moreover there remains unclear about the profit and risks for concerning parties involved in this lending model, according to the SBV. In case of dispute, lenders may lose their money, as P2P companies are not bound to ensure the rights of users.
The SBV also pointed to potential threats of leaking privacy data, cyberattack, lending used for money laundering and tax evasion.
In some cases, P2P companies are using its platform as a way of mobilizing capital with high interest rates, known as multi-level marketing.
The SBV stressed that abusing the P2P lending platform for capital mobilization by individuals or organizations is illegal.
The act of mobilizing capital through credit institutions must follow the Law on Credit Institutions and Law on the State Bank of Vietnam. However, the online P2P lending is considered civil transaction and out of the jurisdiction of those two laws.
The SBV warns citizens and enterprises to remain cautious about participating this lending platform, while encouraging people to access capital through the banking channel.
Additionally, the SBV is working with relevant government agencies for a legal framework managing the P2P lending and new transaction model on digital platform.
Other News
- Vietnamese Gov't plans to continue VAT cut for second half of 2024
- 3,400 taels of gold purchased at the first-in-11-year auction
- HoSE to launch KRX-developed transaction system in early May
- Central bank moves gold auction to tomorrow
- Vietnam’s c.bank sells USD to stabilize exchange rate
- Central bank to auction gold to calm domestic market
- Vietnam's Central Bank ready to steady foreign exchange market
- Finance ministry clears bottlenecks to pave way for stock market upgrade
- Over 60% of Vietnamese use QR codes to pay
- Casinos contribute US$370 million to state budget over 5 years
Trending
-
Hanoi cracks down on food safety violations
-
US-Vietnam relations: Truly amazing progress
-
Four- and five-star hotels to boom in Hanoi as tourism rebounds
-
[Video] Hanoi beauties in sax legend Kenny G's music video
-
Hanoi strives to ensure smooth high school exams
-
Carnaval Ha Long 2024 woos tourists with fireworks and drone light shows
-
Trivial jobs: Hanoians strive to keep their old trades alive
-
Affordable, quality tours offered at Hanoi Tourism Festival 2024
-
Introduction of community tourism area in Hanoi herb kingdom