SBV announces to supervise commercial banks to correct activities

Following people’s complaints that they were encouraged to buy life insurance but in fact, they were forced to buy the insurance by bank staff when asking for loans at many commercial banks, the State Bank of Vietnam (SBV) announced to strengthen supervision of this matter.
SBV announces to supervise commercial banks to correct activities ảnh 1 Illlustrative photo
According to customers, only when buying insurance, they can be disbursed or get loans at a lower interest rate.
The SBV has just issued a document about voters' complaints that customers are forced to buy life insurance at some commercial banks to get loans. The State Bank of Vietnam affirmed that the law on insurance business stipulates the principles, rights, and obligations of the parties involved in the insurance business and exploitation on a voluntary basis and on a client's financial ability.
The regulation also clearly states that insurance agency contracts signed with banks also do not require insurance products to be sold with or associated with banking products and services. The signing and performance of insurance agency contracts under the agreement between the insurance enterprise and the bank must abide by the law.
The SBV said that it will pay visits to commercial banks for reviewing this matter. It promised to have tough penalties on commercial banks which forced customers to buy insurance that is not really necessary when commercial banks grant credit to customers or approve loans for customers in accordance with regulations. The SBV affirmed that it will continue to strengthen the inspection and supervision of this activity, prohibiting commercial banks from persuading customers to buy insurance. If any violations are detected, the State Bank will throw a book on commercial banks in accordance with the provisions of law.
In addition, on the basis of the provisions of the Law on Insurance Business 2022, the SBV will coordinate with the Ministry of Finance in completing legal regulations related to insurance agents, conducting inspection and examination of insurance agency activities, and insurance agencies signing contracts with banks to ensure strict compliance with the right to freely to choose insurance companies and insurance products suitable with customers' needs.

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