A bank teller counting Vietnamese banknotes is seen in this file photo. The central bank has urged local banks to allow easier access to credit for clients to help fight loan sharks
On April 9, SBV held a meeting with the relevant agencies to evaluate their coordination with SBV in the deployment of solutions to expand credit.
Recently, the central bank issued multiple preferential policies to help clients, especially poor people in rural areas, access loans for production and business activities, Tu remarked.
Specifically, SBV has issued legal mandates on the lending activities of local credit institutions and the branches of foreign banks, including Decrees 41 and 55 issued in 2010 and 2015, respectively, on credit policies for agricultural and rural development and Decree 116/2018/ND-CP amending and supplementing Decree 55, issued last year with many breakthrough incentives.
In addition, SBV has launched multiple credit programs such as loans with preferential interest rates to reduce losses for the agriculture sector; loan packages for hi-tech and clean agriculture projects; and housing loans.
SBV also directed local banks to simplify lending procedures and diversify their credit products.
These solutions have met local customers’ demand for capital for their production and business activities and basic needs.
As of March 27, the country’s outstanding loans totaled VND7,390 trillion (US$318.4 billion), up 2.5% over late last year. Of the amount, the outstanding loans for the agricultural and rural sector reached VND1,820 trillion, marking a 2% increase over the end of last year.
Moreover, Vietnam Bank for Agriculture and Rural Development (Agribank) and Vietnam Bank for Social Policies (VBSP) have cooperated closely with social organizations to promote credit programs for the agricultural and rural sector, helping alleviate poverty among residents in rural, mountainous and remote areas.
Accordingly, Agribank has provided loans totaling VND122.2 trillion through borrower groups. Meanwhile, VBSP has offered VND193.3 trillion through borrower groups, nearly VND60.4 trillion through farmer associations, VND75.7 trillion through women’s associations, VND31.5 trillion through veteran’s associations and VND25.8 trillion through the Ho Chi Minh Communist Youth Union.
The loan offers through social organizations has helped credit institutions save on management costs.
Further, these organizations can encourage borrowers to improve production and raise their awareness of the need to repay loans on time, strengthening the connectivity between banks, local authorities, social organizations and borrowers.
In the coming years, the banking sector will continue to coordinate with these organizations to educate local people on the risks of black credit and introduce official access to bank loans. SGT