The State Bank of Vietnam further tightens the rules but provides some favorable clarifications. Towards the end of June 2023, the State Bank of Vietnam (“SBV”) issued two important circulars governing the credit market in Vietnam: Circular 08/2023/TT-NHNN (“Circular 08”) on offshore borrowing conditions to replace Circular 12/2014/TT-NHNN on the same subject matter; and Circular 06/2023/TT-NHNN (“Circular 06”) amending and supplementing certain articles of Circular 39/2016/TT-NHNN on lending activities of credit institutions and foreign bank branches in Vietnam (“credit institutions”). Circular 08 will take effect on 15 August 2023 while Circular 06 will take effect on 1 September 2023. This article provides an overview of the major changes introduced by Circular 06 and Circular 08 and their implications. I. HIGHLIGHTS OF IMPORTANT CHANGES Onshore Loans It is no longer permissible to provide onshore loans to fund the deposit of monies or to fund equity investments other than listed stock investments. Financing capital contributions under capital contribution contracts, investment cooperation contracts, or business cooperation contracts for an investment project that does not meet the eligibility criteria for “being put into business” under relevant laws is prohibited but it is unclear how to determine if a project is eligible “for putting into business.” A legal regime for digital lending is introduced. Each individual may not maintain a total outstanding digital borrowing balance of more than VND100,000,000 with a credit institution. More stringent and detailed requirements on internal lending regulations are imposed on credit institutions. Costs which are funded by reimbursement loans must have incurred within 12 months prior to the credit institution’s decision to lend. Offshore Loans All categories of borrowers...