Organization, operation of SMEs Development Fund defined
The Government has issued Decree No. 39/2019/NĐ-CP on the organization and operation of the Small and Medium Enterprise Development Fund (SMEDF).
This is an off-budget and non-profit governmental fund, which is set up by the PM.
Accordingly, the SMEDF operates in form of one member limited liability company of which the State holds 100% of charter capital.
The Ministry of Planning and Investment is the host agency of the fund.
The Decree stipulates activities of the fund including lending, financing and increasing capacity for the SMEs, receiving, monitoring and using loans, sponsors, aid, contributions, investments, debt classification, risk provisioning and management and financial management.
The interest rate for direct lending is equal to 80% of the lowest interest rate for commercial lending.
The fund provides direct lending (the fund directly supplies lending for SMEs) and indirect lending (the fund provides lending for SMEs through giving capital for commercial banks which are established and operate in line with the laws).