Some banks respond by saying that they are willing to meet client demand for foreign currencies and will not charge fees on such transactions.

The State Bank said it will issue a circular that permits credit organizations to collect fees for selling foreign currencies to individuals. The maximum level is fixed at two percent of the listed prices. This fee, the State Bank says, aims to make up for the costs arising from importing foreign currencies in cash and other related matters such as transportation and procedure clearance.

The State Banks also confirmed that banks must publicize their fees (in Vietnam dong) at transaction points.

Buying US$7,000 a year at maximum

Dong A Bank is the first establishment that has stated it will sell foreign currencies extensively in cash to individuals if they have legitimate demands for foreign currencies and present adequate papers that prove their purposes of using foreign currencies such as travelling as tourists, visiting relatives, going on business, getting medical checks and treatment, or studying abroad.

In case Dong A Bank does not have the currency of a particular foreign country, it will consider selling euros to its clients.

The amount of currencies sold will be decided by the clients’ purposes and duration of staying abroad. The highest amount for a student studying overseas could reach US$7,000 per person a year.

Eximbank also announced that it will sell foreign currencies in cash to its individual clients through its network nationwide. Its requirements and quotas for transaction are similar to those of Dong A Bank.

For clients who make tours of other countries, visit their relatives or go on business for less than seven days, they can buy an amount of foreign currencies worth US$300 per person. If they stay for more than seven days, the level will be raised to US$600. In case clients buy foreign currencies for medical purposes, it will amount to somewhere between $600 and $1,000.

Encouraging the use of credit cards

Most banks have encouraged the use of credit cards with deposits in Vietnam dong among their clients to pay costs overseas because banks do not generate profits from foreign currencies they reserve for clients, and not all banks have sufficient foreign currencies to meet individual demands.

A banking official said that using credit cards overseas is also an official way to use foreign currencies without withdrawing cash.

Le Duc Tho, Vice Director General of Vietinbank, said the virtue of using cards is that clients can withdraw foreign currencies overseas and then repay to domestic banks in Vietnam dong at the listed rates or international exchange rates.