The banking – enterprises connection programme enabled around 22,000 businesses in HCM City to borrow over VNĐ280 trillion (US$12.5 billion) from banks last year. — Photo SHB
HCM CITY – The banking – enterprises connection programme enabled around 22,000 businesses in HCM City to borrow over VNĐ280 trillion (US$12.5 billion) from banks last year.
They had three kinds of loans available, with the city authorities acting as intermediaries for two: low-interest credit packages and loans for key sectors like agriculture, support industries, high-tech application and exports.
For the third, district- and lower-level authorities helped bring the banks and enterprises together to address the latter’s funding needs.
Sixteen banks joined the programme with total capital of nearly VNĐ212 trillion.
“The programme expanded with total loans last year being 60 per cent more than in 2015, and the number of customers increased by 2.3 times,” Nguyễn Hoàng Minh, deputy director of the State Bank of Việt Nam (SBV)’s HCM City office, told meeting held on Tuesday to review the programme.
According to the SBV, complaints from businesses about difficulties in getting credit had reduced, and in fact banks are meeting with enterprises in a bid to find customers since they are awash in funds.
This year the programme will focus on high-tech agriculture, start-up businesses and household businesses that expanded into enterprises, and seeks to lend VNĐ241 trillion ($10.7 billion) with short-term interest rates of under 7 per cent and medium- and long-term rates of 8–10 per cent.
The city’s [annual] price stabilisation programme around Tết was also discussed at the meeting.
“The programme has played a very important part in stabilising the market,” Võ Văn Việt, head of the Ministry of Industry and Trade’s domestic market department, said.
Before the programme began in 2011, city authorities had spent VNĐ50-300 billion a year to stabilise the consumer market by lending money to enterprises agreeing to sell at low prices.
In 2012-14 they had used both public funds and bank credit for the programme.
But since 2015 bank funding has been enough, with lenders providing VNĐ13-14 trillion a year.
Nguyễn Phước Thanh, Deputy Governor of the SBV, taking about the banking – enterprises connection programme said: “[It] should be expanded to benefit more enterprises.”
But he also stressed that the banking sector needs a clear framework to be created by the authorities to work with enterprise community.
“Local authorities should create favourable conditions for enterprises to complete legal requirements related to their assets.” – VNS