Credit programme gives boost to HCMC economic growth

Credit packages at preferential interest rates offered to small and medium sized enterprises in Ho Chi Minh City leveraged the city’s economic growth to reach 8.3 per cent in 2018.

As of late March, 1,100 businesses in Ho Chi Minh City (HCMC) had reportedly borrowed more than VND9.12 trillion (US$392.5 million).

Also under the same programme last year, commercial banks disbursed VND285.000 trillion (US$12.25 billion) to assist 10,600 businesses in their production and business, thus helping local credit growth reap a growth rate of 14.69 per cent.

Credit packages at preferential interest rates offered to small and medium enterprises (SMEs) in HCMC leveraged the city’s economic growth to reach 8.3 per cent last year.

However, a slew of local enterprises made complaints about barriers to their financial access. They elaborated that their assets are normally appraised at lower prices than market rates while the delayed progress of carrying out lending procedures remains a big hindrance.

They suggested that local banks should provider additional unsecured loans and those dedicated to specific business lines, as well as pay more attention to facilitating financial access for local producers and exporters.

Dao Minh Tu, Deputy Governor of the State Bank of Vietnam (SBV), said the banking sector will continue its flexible monetary policy to curb inflation and keep on the macro-economic stability.

The sector also assigns priority to pumping loans into producers and trading firms which are considered a key element for overall economic growth, Tu added.

Sixteen credit institutions, the municipal Departments of Industry and Trade, and Agriculture and Rural Development, the SBV branch in HCMC inked memorandums of understanding on providing credit assistance for companies involved in developing the city’s key products.