Mr. Nguyen Minh Nhut – DIV’s Mekong Delta Regional Branch speaks at the members’ general meeting of Dinh Thuy PCF
In the Mekong Delta region (MDR), there are many People’s Credit Funds (PCFs) in communes in far and remote areas, where depositors have limited access to legal regulations and policies related to banking operations, including DI legal regulations. Therefore, communication of DI policy to these depositors, especially coordination with the PCF in disseminating DI policy at members’ general meetings of PCFs is the Branch’s priority and has been continuously deployed since the enactment of the Law on DI.
According to the State Bank of Vietnam (SBV)’s Circular No. 04/2015/TT-NHNN dated March 31, 2015, a PCF must organize its members’ general meetings once a year within 90 days from the end of the financial year. Accordingly, PCFs organize general meetings and the Branch, in cooperation with PCFs, organizes public awareness events mainly in the first quarter every year. From the first quarter of 2018 to the end of the first quarter of 2021, the Branch assigned some officers to directly participate in the general meetings of PCFs and coordinated with PCFs to organize more than 30 sub-sessions for DI policy dissemination at over 30 general meetings.
Normally, a PCF’s general meeting takes place in one working session, with a large number of participants and a lot of problems to be solved. The Branch assesses that communication of DI policy at PCF general meetings not only spreads information on DI to the public but also helps PCFs to confirm to their members that PCFs’ operations are always regulated and supported by various agencies, organizations including the DIV. Identifying the audiences of the communication as PCF members, depositors and leaders of local Party committees, authorities and associations, at each PCF general meeting, heads of the Branch have given priority to disseminating, clarifying legal regulations on DI and issues related to banking operations, which attract attention from the audiences. Some communication activities are: affirming that it is the State’s consistent policy “to protect the legitimate rights and benefits of depositors” (Clause 1, Article 7, the Law on DI in 2012) and that one of policies protecting the rights and interests of depositors now is DI policy, which is implemented by the DIV; providing audiences with information on the legal status of the deposit insurance organization, the operations of the DIV as the sole organization which conducts DI policy in Vietnam legalized by the Law on DI; members, individual depositors having deposits at PCFs protected by the DIV without paying DI premiums.
Especially, the DI coverage limit is the issue which always receives attention from members, depositors at almost all PCFs. Since some members, depositors were not fully aware of the coverage limit, they divided their deposited money into different accounts or wondered about the amounts of deposits exceeding the coverage limit announced by the DIV. Regarding this issue, heads of the Branch provided detailed information on the coverage limit in accordance with Article 24 of the Law on DI and reasonable explanations of why the SBV shall propose the Prime Minister set a coverage limit at each period, so that members, depositors at PCFs could acquire full understanding of their rights.
Moreover, heads of the Branch and heads of the SBV’s branches which manage PCFs in the MDR exchanged and shared information on current regulations, solutions, measures of protecting legitimate rights and interests of deposits in case PCFs face difficulties in paying back deposits as well as provided specific information about the amounts of deposits exceeding the coverage limit offered by the DIV, which depositors will still be given priority to receive during the process of PCF asset liquidation.
In addition to the dissemination of legal regulations on DI which attract attention from depositors, at the general meetings of PCFs, the Branch also talked about the role of the DIV as PCFs’ companion in contributing to ensuring the safe and effective operations of PCFs. This role is demonstrated in various phases: (1) upon the establishment of the PCF, the DIV grants a certificate of DI participation to the PCF so that it can display the certificate publicly in its headquarters, transaction units. The certificate of DI participation is proof that the PCF participates in DI and also the commitment of the DIV to protecting depositors, providing them with information about their rights in a correct, timely and transparent manner; (2) During its operation, the PCF is regularly supervised and periodically examined by the DIV. The supervision, examination results are the basis for the PCF to correct its weaknesses and errors to make its operations safer and comply with legal regulations; (3)The weak PCF will be resolved and provided with special loans by the DIV to improve its liquidity and recover its operations; (4) The PCF can propose the DIV make pay-outs to depositors when the pay-out duty arises.
The Branch’s communication at the general meetings of PCFs has contributed to spreading information on DI policy to the public in PCFs’ areas; raising awareness of the protection offered by the DIV for members and depositors at PCFs or any other credit institutions which are allowed to accept deposits of individuals; informing the leaders of local Party committees, authorities and associations and the members of PCFs about the roles of the DIV in accompanying and supporting PCFs so that these leaders can give suitable directions related to the operations of PCFs, thus raising public trust in the local PCF system.
With regard to the dissemination of DI policy at the general meetings of PCFs, in recent times, the Branch has received a lot of good responses from the SBV’s branches, PCFs, local Party committees, authorities and associations and many proposals for coordination in the dissemination of DI policy at the general meetings of PCFs. The Branch will continue to conduct public awareness programs at PCFs’ request at nearest general meetings.