Lending gold to the public by gold-trading businesses is not prohibited by regulations, but the risk is significant, causing both borrowers and lenders to be cautious.\n\nUnpredictable risks\n\nThe Vietnam Gold Trading Association has proposed to the Prime Minister to allow gold jewelry manufacturing and trading companies to borrow gold from the public at interest rates negotiated in accordance with civil law to support production. They also proposed that the government issue regulations and guidance on the mechanism and methods for mobilizing and purchasing gold from the public.\n\nAccording to lawyer Truong Thanh Duc, director of ANVI Law Firm, arbitrator at VIAC, the activity of gold lending among enterprises is a civil relationship; the law has not prohibited it and there is no specific regulation yet.\n\nIn the banking sector, mobilizing and lending in gold is prohibited due to high risk. However, outside the banking system, transactions involving gold such as capital contributions, borrowing, gifting, exchanging, buying and selling, or using gold as collateral are not prohibited.\n\nAccording to Mr. Duc, current law only prohibits using gold as a means of payment, and the operation gold trading, excluding jewelry, is a conditional investment business that requires a license (rank 192 in the Investment Law 2025).\n\nMr. Duc notes that the law does not prohibit the parties from freely agreeing to loan gold (except for cases under the gold business activity that must meet conditions). However, the risk of this form is very large, both in supply and price volatility.\n\nHe raises the question: if at maturity the borrower cannot repay, who would borrow and who would lend?\n\n[image]\n\nAccording to experts, gold lending faces very large and hard to control risks.\n\nIf
gold prices stay stable or fall, risk is not large. However, when prices swing sharply, even rise dramatically, the borrower can easily find it difficult to settle in gold or convert to cash.\n\nHe cites a recent case: a company, Sai Gon Seafood Corp (APT), could not repay a debt to Southern Bank (now Sacombank) of 5,833 taels of SJC gold, at 17.66 million dong per tael, equal to 103 billion dong. By the end of last year, gold price rose to 152.8 million dong per tael, equal to 891.28 billion dong, an 8.65x increase.\n\n“Large-scale borrowers face risk even if there is no interest or low interest. Both businesses and citizens must be cautious of hidden risks,” he emphasized.\n\nThus, enterprises can proceed if they assess feasibility and ensure repayment in gold. However, Mr. Duc notes that the State should issue clear warnings about risks to the public.\n\nLack of control could trigger a new goldization cycle\n\nEconomist Le Ba Chi Nhan says Vietnam is one of the countries with the largest gold hoards in the public, but most of this resource has not yet participated in production or added value to the economy.\n\nMeanwhile, jewelry manufacturing businesses still have to buy raw materials at market prices, endure capital pressures and depend on legally controlled supply. If a public gold-lending mechanism exists, enterprises could reduce working capital pressure, expand production, and enhance the competitiveness of the jewelry sector with export potential.\n\nHowever, Mr. Nhan says feasibility of the proposal does not lie in civil matters, because asset borrowing is consistent with law, but mainly in monetary policy and stability of the gold market, under government regulation.\n\n“In practice, gold-based mechanisms can pose risks if not designed strictly: creating a parallel gold market, increasing speculation, exerting pressure on exchange rates, and weakening the role of the domestic currency in circulation. If gold lending is allowed freely by agreement, there is a risk of morphing into large-scale gold mobilization outside financial supervision,” he warned.\n\nThus, the proposal can only be implemented with institutional safeguards: limit borrowers (only jewelry manufacturers), limit use (only for jewelry production), mandatory registration and reporting, and oversight; and do not allow transforming gold lending into disguised credit.\n\nIf designed properly, this could mobilize public gold resources for production rather than speculation. Conversely, without controls, this mechanism could spark a new goldization cycle. Therefore the issue is not whether to lend gold but how to design governance to use the resource effectively while ensuring national monetary stability.\n\nLawyer Truong Thanh Duc also argues that the government does not need a separate regulation for this activity.\n\n“The principle of law is that what is not prohibited is allowed. If additional regulations to permit are issued, it would be like tying our hands, running counter to the spirit of free enterprise, and reducing license conditions. It could also create the impression that gold lending is officially permitted or guaranteed by the state,” he notes.\n\nOn interest rates, because this is not a cash loan, it is not regulated by the cap on interest rates in the Civil Code; parties can freely negotiate.\n\nLawyer Duc also says this is not a good solution to mobilize resources. Instead, citizens should be encouraged to sell gold to raise capital for business or to invest in channels such as forming a company, buying bonds, stocks, real estate, or placing funds in banks, thus putting resources into circulation and production.\n\nAdditionally, gold is a high-value, portable asset, easy to manage and highly liquid, so it can be used effectively in collateral transactions such as pledges, deposits, guarantees, and many other civil obligations, rather than sitting idle in a vault.\n\nNguyen Le\n\nVietnamNet
