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The State Bank of Vietnam (SBV) Governor has issued a circular with the aim of standardizing the supervision and management of the operation network of microfinance institutions (MFIs) and to decentralize the authority for licensing the establishment of MFI network units.
Effective as of September 15, 2025, Circular 19/2025/TT-NHNN on the operation network of MFIs will supersede Circular 19/2019/TT-NHNN dated November 5, 2019.
Circular 19 specifies that an MFI’s operation network consists of branches, transaction bureaus, representative offices, non-business units and transaction points. Each type has distinct functions, powers and operation scopes.
It also says that branches and transaction offices are units having their own seals. A transaction office operates under the direct management of a branch and within the same geographical area. A representative office is not allowed to conduct business operations, while a non-business unit performs functions like research, training or professional support. Notably, transaction points are specifically defined for the first time as units without seals. They can only carry out certain operations such as receiving loan application dossiers, disbursing loans, collecting debts and paying deposits.
When wishing to set up a branch, transaction bureau, representative office, non-business unit or transaction point, an MFI unit is required to submit a dossier of request for approval of the establishment of such a unit which must consist of plans on organization, personnel and physical facilities, an operational scheme and relevant internal documents.
The new circular also decentralizes the competence to the SBV Governor to approve the establishment of MFI branches, the Department of Safety Supervision of the Credit Institution System to approve the establishment of MFI transaction offices, representative offices and non-business units and directors of the SBV branches in locations where head offices of MFI branches, transaction offices, representative offices and non-business units are located to handle changes in names or relocations of such head offices or termination of operation of MFI units.
In addition, the SBV requires MFIs to fully disclose information about their network-related activities, such as establishment, changes or operation termination, on their websites and the SBV’s portal. Information updates must also be fully submitted to local business registration agencies in the specified order.-
By VLLF
