PREMATURE WITHDRAWAL OF DEPOSIT, CAN  INTEREST STILL BE RECEIVED IN FULL?

Premature withdrawal of deposit is defined as the premature withdrawal and payment of deposits of organizations (excluding credit institutions and foreign bank branches) and individuals’ deposits at credit institutions and foreign bank branches. In particular, issues related to premature withdrawal of deposit need to comply with the laws, including interest rates for premature withdrawal of deposit.

So in which case, premature withdrawal of deposit can still receive the full interest according to the original agreed term?

1.         What are the forms of premature withdrawal of deposit?

Premature withdrawal of deposits in accordance with current laws include 4 forms:

–              Time savings deposits.

–           Time deposits.

–           Deposit certificates, bills, treasury bills, and bonds issued by credit institutions.

–           Other forms of receiving time deposits. 

2.         Is it possible to implement the premature withdrawal of deposit in part?

Clients can withdraw a part or all of the deposits before the due date or maturity date of such deposit. Credit institutions and clients shall make agreements on the premature withdrawal of deposits in compliance with regulations of the State Bank of Vietnam regarding each specific form of deposit.

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3.         How is the interest rate on premature withdrawal of deposit?

The interest rate on premature withdrawal of deposits may be agreed upon between the clients and the credit institution corresponding to the specific deposit form, however, it must not be contrary to the provisions of laws:

a.            When a client withdraws all of the deposit:

Credit institutions shall apply a maximum interest rate equal to its lowest interest rate of demand deposits based on the type of client and/or the currency of the deposit when such client withdraws it.

b.         When a client withdraws a part of the deposit:

–           Regarding the part of withdrawn deposit before maturity, credit institutions shall apply a maximum interest rate equal to its lowest interest rate of demand deposits based on the type of client and/or currency of the deposit when such client withdraws it;

–           Regarding the remaining deposit, credit institutions shall apply the interest rate equal to the interest rate applied to the deposit that the client has withdrawn a part.