Eximbank Deputy General Director talks about the debt of 8.5 million VND that must be paid 8.8 billion VND

The above information was announced by Mr. Nguyen Ho Hoang Vu - Deputy General Director of Vietnam Export Import Commercial Joint Stock Bank (Eximbank) at a regular press conference on the socio-economic situation of Ho Chi Minh City on the afternoon of March 21.

According to Mr. Nguyen Ho Hoang Vu, for international credit card products, when building products, Eximbank consults market practices as well as similar products on the market to come up with interest rate, fee policies and competitive factors so that its products best meet customers' needs.

In the case of customer PHA who owed 8.5 million VND and after 11 years was asked to pay 8.83 billion VND, the Deputy General Director of Eximbank said that the customer's card debt was overdue for 11 years.

According to Mr. Nguyen Ho Hoang Vu, normally, for Eximbank's overdue card debt handling process, the bank's card processing staff will base on the customer's card debt situation to propose to the leadership an appropriate interest and fee collection level before working with the customer. This fee must be approved by the leadership before being reported to the customer.

However, in the case of PHA customers, the bank's debt settlement officer was very mechanical, did not follow the procedure but sent a very mechanical notice to the customer, leading to frustration from the customer.

"We are very sorry for what happened," said Eximbank Deputy General Director.

Mr. Nguyen Ho Hoang Vu added that the bank has been actively working with the customer. On March 19, a representative of Eximbank met with the customer. Eximbank and the customer had a frank discussion, in the spirit of cooperation, understanding and sharing, agreeing to coordinate to resolve the case, ensuring the interests of both parties in the shortest time.

“The bank and the customer will agree on a certain interest rate to ensure the interests of both parties are balanced. There is no way that the bank will collect the full amount of money just because it announced that it would collect more than 8 billion VND,” said Mr. Nguyen Ho Hoang Vu.

At the press conference, Mr. Vo Minh Tuan - Director of the State Bank of Vietnam, Ho Chi Minh City Branch, said that the figure of 8.5 million VND after 11 years becomes 8.8 billion VND (an increase of about 1,000 times), which anyone who hears it will find unreasonable.

"Basically, this is how compound interest is calculated. In all transactions, including credit cards, there are many units for calculating compound interest, which means interest on interest. Other banking transactions are not allowed to calculate compound interest," said Mr. Tuan.

Mr. Vo Anh Tuan - Director of the State Bank of Vietnam, Ho Chi Minh City Branch, answered questions at the press conference. Photo: Chan Phuc — Mr. Vo Minh Tuan - Director of the State Bank of Vietnam, Ho Chi Minh City Branch, answered questions at the press conference. Photo: Chan Phuc

The Director of the State Bank of Vietnam, Ho Chi Minh City Branch, said that he will direct credit institution branches to review cardholders and customers to find out which cardholders have not used it for a long time or have had similar cases in order to work and find a unified agreement to ensure the interests of all parties.

Require credit institutions to provide key information about products and services for customers to understand, and to publicly disclose their fee schedules and only collect fees according to the publicly disclosed fee schedules.

“In interactions between customers and banks, we recommend that banks need to inform customers of balance changes via email, text messages, and postal mail. Banks operate on reputation, and if something like this happens, it will more or less affect their brand and weaken their competitive advantage,” Mr. Vo Minh Tuan emphasized.

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