The State Bank of Vietnam (SBV) has announced two decisions to further reduce operating interest rates, effective from May 25, 2023.
The first decision, numbered 950/QD-NHNN, focuses on the interest rates for refinancing, rediscounting, overnight interbank electronic payment, and compensatory lending for capital shortfall in offset payments by SBV to credit institutions (CIs). Under this decision, the interest rate for overnight interbank electronic payment and compensatory lending for capital shortfall in offset payments by SBV to CIs has been reduced from 6.0% per annum to 5.5% per annum. The refinancing interest rate has been lowered from 5.5% per annum to 5.0% per annum, while the rediscounting interest rate remains unchanged at 3.5% per annum.
The second decision, numbered 951/QD-NHNN, concerns the maximum interest rates for Vietnamese Dong (VND) deposits of organizations and individuals at credit institutions, as stipulated in Circular No. 07/2014/TT-NHNN dated March 17, 2014. According to the decision, the maximum interest rate for non-term and term deposits of less than one month remains unchanged at 0.5% per annum. The maximum interest rate for deposits with terms from one month to less than six months has been reduced from 5.5% per annum to 5.0% per annum. However, the maximum interest rate for VND deposits at the People’s Credit Fund, microfinance institutions, has been lowered from 6.0% per annum to 5.5% per annum. The interest rate for deposits with terms of six months or longer will be determined by the CIs based on market supply and demand for capital.
The State Bank of Vietnam’s decision to further decrease operating interest rates aims to stimulate economic growth, support liquidity in the interbank market, and provide favorable conditions for borrowing and lending activities within the banking system. These measures are expected to encourage investment and consumption, contributing to the overall stability and development of the Vietnamese economy.
The SBV reassures the public and the banking sector that it will continue to closely monitor market developments and adopt appropriate monetary policies to maintain macroeconomic stability and ensure the efficient functioning of the financial system.