Amending and supplementing regulations on management and use of local budget capital entrusted through the Vietnam Bank for Social Policies

The Ministry of Finance has just issued Circular No. 84/2025/TT-BTC amending and supplementing a number of articles of Circular No. 11/2017/TT-BTC of the Ministry of Finance regulating the management and use of local budget capital entrusted through the Vietnam Bank for Social Policies for lending to the poor and other policy beneficiaries.

Accordingly, the Circular not only focuses on unifying the capital management focal point at the provincial level to suit the two-level government organization model, but also provides more specific and clear regulations on interest rates, management fees, credit risk provisioning and handling mechanisms, in order to improve efficiency and ensure safety for this important source of social security capital.

Circular No. 84/2025/TT-BTC of the Ministry of Finance stipulates that provincial budget capital is annually allocated (depending on the actual situation of each locality and the ability to balance the budget) and entrusted through provincial branches of the Social Policy Bank to lend to the poor and other policy beneficiaries as decided by the Provincial People's Council.

To do this, the Circular also clearly specifies the specialized agency assigned by the provincial People's Committee to sign the trust contract with the provincial branch of the Social Policy Bank.

The above regulations are amended to comply with the implementation of the 2-level local government model operating from July 1, 2025, when there will be only 2 levels: provincial and commune levels, so the regulations are amended to remove the authority of the district level.

For capital sources that have been entrusted by the district budget through the Social Policy Bank before the change in administrative organization model, Circular No. 84/2025/TT-BTC also provides a clear transfer roadmap.

Accordingly, for the district-level budget capital entrusted through the Social Policy Bank, the handover will be arranged to the provincial-level Social Policy Bank branch to continue lending. The specialized agency assigned by the provincial People's Committee will sign a trust contract with the provincial-level Social Policy Bank branch to continue monitoring and management.

Circular No. 84/2025/TT-BTC also gives local authorities more autonomy in developing specific lending policies suitable to actual conditions.

Regarding the handling of risky debts, Circular No. 84/2025/TT-BTC clearly states that if due to objective reasons, the general mechanism prescribed by the Prime Minister shall apply. However, for other risky cases, the Circular empowers the locality as prescribed by the Provincial People's Council. The authority to consider and handle risky debts shall be decided by the Chairman of the Provincial People's Committee.

In case the reserve fund is not enough to compensate, the Circular also opens a flexible handling mechanism that depending on the actual situation of the risky loan, the specialized agency assigned by the provincial People's Committee to sign the trust contract shall preside, coordinate with relevant departments, branches and the provincial Social Policy Bank branch to report to the provincial People's Committee to supplement the provincial budget for handling, or directly reduce the trust capital of the provincial budget transferred through the provincial Social Policy Bank branch.

Source: https://hanoimoi.vn/sua-doi-bo-sung-quy-dinh-ve-quan-ly-va-su-dung-von-ngan-sach-dia-phuong-uy-thac-qua-ngan-hang-chinh-sach-xa-hoi-713841.html