A new draft regulation for financial leasing: Expanding capital headroom for businesses

The State Bank of Vietnam (SBV) has officially solicited public feedback on a draft circular governing financial leasing activities. According to the Credit Department for Economic Sectors, financial leasing operations are currently implemented under Circular No. 26/2024/TT-NHNN dated June 28, 2024.

Expanding the scope of financial leasing

The strategic focus of the draft is to broaden the range of leasable assets beyond traditional tangible assets, paving the way for the capitalization of intellectual property and digital assets, while gradually shifting from physical control to the management of cash flows and intangible value within the financial system.

Specifically, under Clause 2, Article 3, leasable assets are clearly divided into two groups. The first group comprises tangible assets such as machinery, equipment, and means of transport, which are easy to value, repossess, and liquidate, carry relatively low risk, and are primarily managed through physical inspection. By contrast, the second group—intangible and digital assets—includes software, data, exploitation rights, and intellectual property. These assets lack physical form, are difficult to value, have liquidity dependent on niche markets, and require management models based on cash-flow monitoring and operational performance.

Speaking with Business Forum, a Hanoi-based environmental technology company said the draft creates opportunities to access medium- and long-term capital without large upfront matching funds, while optimizing tax costs through depreciation and the treatment of lease payments as operating expenses instead of capital investment. “This expansion also gives financial leasing a clear competitive edge over traditional bank credit, as banks typically lend only about 70–80% of the value of tangible collateral, whereas financial leasing can finance up to 100% of asset value, including software and data systems.”

In addition to expanding asset scope, the draft proposes raising the threshold for “small-value financial leasing transactions” from VND 100 million to VND 400 million. Reports from credit institutions show that outstanding loans below VND 100 million account for just 0.2% of total credit, while loans exceeding VND 1 billion represent more than 85%. With 98% of current clients being organizations, adjusting the small-value threshold is seen as a “key” to expanding into the small and medium-sized enterprise (SME) segment. Raising the threshold would significantly free up appraisal resources, allowing leasing companies to avoid detailed assessments of asset-use plans for small transactions and instead focus on monitoring usage purposes and the overall financial capacity of clients.

Mr. Pham Xuan Hoe, Secretary General of the Vietnam Leasing Association, noted that simplifying documentation for common assets such as photocopiers, scanners, or office equipment valued at VND 300–500 million would shorten approval times, making financial leasing a more flexible financing tool—approaching consumer lending in convenience but with greater sustainability. The new provisions also align financial leasing with the regulatory framework for small-value lending under Circular No. 39/2016/TT-NHNN, reducing overlap and regulatory risk.

The draft further underscores the regulator’s role by addressing two major bottlenecks related to asset valuation and the economic rights of lessees. Lessors would be allowed to choose between self-determining asset values in accordance with Ministry of Finance standards or engaging independent valuation firms. This discretion is particularly important for intangible and digital assets, whose values can fluctuate rapidly and are ill-suited to traditional valuation methods.

In practice, requiring third-party valuation for all assets—especially software or data—would slow implementation to a pace inconsistent with the dynamics of the technology sector.

The draft also allows lessees, by agreement, to enjoy preferential regimes previously reserved for asset owners, such as toll discounts, maintenance, or warranty benefits. This provision removes the psychological barrier of ownership, enabling lessees to fully benefit from operational conveniences and incentives as de facto owners, while preserving working capital for production and business activities.

Restructuring capital flows

Over the long term, experts believe implementation of the draft could help restructure capital flows in the credit market. With the requirement that leased assets have a useful life of more than one year, financial leasing is expected to be repositioned as a strategic partner in enterprises’ fixed-asset investment roadmaps.

To capitalize on this opportunity, diversified finance companies will need to rapidly transform their business models and risk management frameworks. Expert recommendations include developing software leasing models based on SaaS platforms; rolling out bundled leasing packages combining hardware and software below the VND 400 million threshold with automated approval processes; and investing in capabilities for valuing intangible assets and monitoring cash flows.

Associate Professor Dr. Nguyen Thi Kim Nhung of the University of Commerce advises leasing companies to proactively design differentiated products in which financing is closely linked to the asset life cycle (machinery, equipment, vehicles, etc.), with greater flexibility in debt repayment cash flows.

She also emphasizes the importance of combining financing with non-financial services—an area of potential advantage that remains underexploited in the leasing sector. These services include advising on asset selection aligned with enterprise scale, technology, and development strategy; supporting maintenance, insurance, and asset management to reduce operating costs and technical risks; and connecting ecosystems of equipment suppliers, insurers, logistics providers, and after-sales services.

The expert further highlights the role of staff training, with a focus on the fundamentals of financial leasing products (legal, accounting, tax, and risk management aspects); solution-consulting skills rather than simply selling financing; and the ability to persuade based on long-term value, helping clients recognize overall benefits rather than focusing solely on capital costs. Only when staff deeply understand and believe in the value of the service can they effectively act as “messengers” of the financial leasing model to the market.

Overall, the draft amendments to financial leasing regulations go beyond resolving technical bottlenecks—particularly in non-performing loan handling—and reflect concrete efforts by regulators to operationalize the spirit of Resolution No. 68-NQ/TW on private-sector economic development.