HCM CITY — A stimulus package that HCM City authorities created last year to offer preferential loans has not been effective because of the length of time for approval of applications, according to reports from local businesses.
Huynh Van Hai, director of the Bao Long Foodstuff Company, was quoted by Sai Gon Giai Phong (Liberated Sai Gon) newspaper as saying that he could not get a loan from the stimulus package after waiting for a year.
Hai said that he needed VND2 billion (US$96,000) out of VND6 billion ($288,000) to make "energy food" from chicken, based on his research of 10 years.
He said the stimulus-package loan required that he offer a warranty from the company's bank or property as collateral.
"If I had enough property value for a deposit, I could get a normal loan from a commercial bank. Then I wouldn't have to wait a whole year to get a loan from the city's stimulus package," he said.
Hai suggested that the city adjust the stimulus-package loan requirements.
Huynh Van Minh, chairman of the HCM City Business Association, said very few businesses in the association could access the stimulus-package loans because of the eligibility requirements.
Pham Ngoc Hung, the association's deputy chairman, said the stimulus had not been popular among the business community over the last 12 months. It was created last year in May.
Hung said local authorities authorised the HCM City Finance Investment Company to do the initial processing of loan applications, which has hindered access to businesses.
"Initial application processing must be done by the company, and then the application is transferred to relevant agencies for the next consideration. It has taken a long time and businesses have lost their investment opportunities," he said.
The association recommended that city authorities revise the requirements as well as the methods of application processing.
It also suggested adding more capital to the stimulus programme as the demand was much larger than the total amount originally offered.
The city People's Committee created the stimulus package of VND8 trillion ($384 million) to assist local businesses in their production. — VNS