Press Release: Expectations from the lending program for social housing under Decree 100 of the Government

Decree No. 100/2015/ND-CP dated 20 October 2015 of the Government on development and management of social housing, which come into effect on 10 December 2015, inspires/derives hope for the poor and low-income people to have more favorable environment to access lending for social housing.

Subsequently, the State Bank of Vietnam issued Document 9496/NHNN-TD dated 10 December 2015 by the Governor guiding VBSP to implement the Decree. Accordingly VBSP will provide lending for social housing (for buying, renting, building or repairing house) to beneficiaries stated in Article 49 of Housing Law, including:

1. People who have contributed to the revolution, family of people who have contributed to the revolution under the legislation on policies for people who have contributed to the revolution; 

2. Low-income people, the poor, near-poor households in urban areas;

3. Employees at enterprises operating inside and outside the industrial zone;

4. Officers, military non-commissioned officers, technical non-commissioned officers, professional military officials, employees at security and defense agencies;

5. Government staff under the legislation.

Under the regulations, the poor, low-income households and policy beneficiaries will get loan from VBSP with preferential interest rate, longer term and particularly more favorable conditions to access the loan.  

The Government will decide the preferential interest rate of VBSP lending for social housing based upon the proposal of VBSP Board of Directors periodically. VBSP is now submitting the proposed interest rate of below 5% (prevailing rate applied for social housing lending at commercial banks)  and above 3% (prevailing rate applied for housing lending for the poor at VBSP).

The minimum loan term is 15 years since the first disbursement. In case the borrowers prefer a shorter term, they will discuss with the bank on their expected term.