Interest Rates and Factoring Fees

Circular 02 stipulates that interest rates and factoring fees shall be agreed upon by the factoring unit and the customer in accordance with the provisions of the law.

When due, if the factoring debt and interest are not paid or are not fully paid according to the agreement, the customer must pay interest as follows:

- Interest on the factoring debt according to the agreed factoring interest rate corresponding to the factoring term that has come due but has not been paid;- In case the customer does not pay interest on time as stipulated in point a of this section, they must pay overdue interest at an interest rate agreed upon by the factoring unit and the customer but not exceeding 10% per annum based on the overdue interest balance corresponding to the overdue period;- In case the factoring debt is overdue, the customer must pay interest on the overdue factoring debt corresponding to the overdue period, the applied interest rate not exceeding 150% of the in-term factoring interest rate at the time the debt becomes overdue.

Note that in the case of applying an adjusted factoring interest rate, the factoring unit and the customer must agree on the principles and factors to determine the adjusted interest rate and the time to adjust the factoring interest rate. In case the factors to determine the adjusted interest rate lead to multiple different factoring interest rates, the factoring unit shall apply the lowest factoring interest rate.

View details Circular 02/2017/TT-NHNN effective from September 30, 2017.

-Thao Uyen-

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