Credit information is defined as “related data, figures, datum of borrowers in the participating organizations of a credit information company”, and credit information services provision refers to the provision of credit information products by credit information companies to its users on the basis of collecting, processing, and storing credit information. Credit information products are created by credit information companies in the form of reports, publications or other forms containing credit information.
Credit information services are a conditional business which requires a certificate of eligibility for providing credit information services, an Eligibility Certificate, from the SBV. There are six main requirements to obtain an Eligibility Certificate:
- Information infrastructure;
- Minimum charter capital of VND30 billion;
- Managers and members of the inspector committee;
- Business plans to ensure not to operate business lines other than the provision of credit information;
- The minimum of participating organizations; and
- Written agreement on provision of credit information and credit information products with fundamental contents as required in Decree 58.
A credit information company must have at least 15 participating organizations being credit institutions and foreign branches (other than policy banks, co-operative banks, people’s credit funds and micro-financial institution).
Credit information companies are allowed to exchange credit information with other credit information companies for the purpose of provision of credit information service. Participating organizations are only permitted to provide information of a customer to any other organization or individual (including other participating organizations) upon request of competent State authorities in accordance with the laws, or consent of the customer. Participating organizations of a credit information company are not allowed to provide their credit information for another credit information company except for the CIC.
Collection and storage of credit information
There are four main sources for collection of credit information, comprising of:
- Participating organizations in accordance with undertaking or agreement of provision of credit information;
- Other credit information companies under an agreement;
- State authority; and
- Other legitimate sources as regulated by the laws.
Credit information allowed to be collected includes:
- Identification information of borrowers and related persons of the borrower in accordance with the laws;
- Information on the history of credit extension, property rental, purchase in installment and pawning;
- Information on the history of debt repayment, due and undue debt, payment deadline, credit limit, debt group, debt sale, off-balance commitment and ranking scores of borrowers;
- Information on security for performance of repayment obligations of the borrower; and
- Other relevant information which does not violate customers’ legitimate rights, exclusive of customer information categorized as State secrets.
Credit information must be stored for a period of at least five years from the date of collection by credit information companies. Such storage must comply with the requirements on safety, confidentiality and avoidance of possible accidents, disasters and prevention of illegal external access.
Processing and correction of credit information
Credit information collected must be examined, analyzed, evaluated, consolidated and updated in order to create credit information products on the basis of not distorting the nature and contents of credit information. Of note, negative information of borrowers is only utilized for the creation of credit information products within the period of five years from the date on which such negative information is concluded unless otherwise stipulated by the laws.
A credit information company is liable for correcting credit information within a mandatory period upon finding incorrect information or at the request of participating organizations or borrowers. In case the borrower fails to receive or does not agree with a written response by the credit information company regarding the borrower’s request for correction, the borrower has the right to demand a settlement or initiate procedures for filing a lawsuit.
Provision of credit information products
A user, based on an agreement entered into with a credit information company, will be provided with credit information products as processed by the credit information company, but not the original information. Customers can be participating organizations, borrowers, other credit information companies, competent State authorities or organizations or individuals for their legitimate purposes in accordance with the applicable laws. Credit information products cannot be modified, provided or shared to any other third party, except for the case that users being borrowers are provided with credit information products regarding themselves for their own legal purposes. In addition, copying and using credit information products internally by users being organizations must be in line with an agreement as signed with the credit information company. Failure of compliance with such regulations shall cause an administrative fine up to VND40 million applied to individuals and VND80 million applied to organizations.
National Credit Information Center of Vietnam (CIC)
In terms of the State management of credit information, provision of credit information of the state bank of Vietnam is conducted by the Credit Information Center as the focal point for the main purpose of creation of a national database on credit information.
The scope of credit information which is provided to the CIC is broader than that allowed to be collected by credit information companies. The credit information is provided to the CIC by credit institutions and branches of foreign banks in the form of electronic data within a required time and is categorized in accordance with the following criteria:
- Customer identification information;
- Credit agreement information;
- Credit relationship information;
- Information on the status of credit card account;
- Information on loan security;
- Annual financial information of borrowers being enterprises, including balance sheets, income statements, cash flow statements as regulated by the MOF; and
- Information regarding investment in form of bond into the borrower being an enterprise.
Based on the information received, the CIC uses technological and professional solutions in order to process credit information data including receipt, standardization, cleaning, combination and updating into the national database on credit information. Processing and storage of credit information data must ensure integrity, sufficiency, without errors in the information during processing and storing, and can be extracted upon required.