Who can access low-interest credit packages?

Experts warn that businesses suffering the most may not be able to access the VND285 trillion aid package because they cannot prove solvency.

In February, the government announced a VND285 trillion credit package to support enterprises amid the Covid-19 crisis.

Who can access low-interest credit packages?



The package doesn’t come from the state budget, but from commercial banks. More than 10 commercial banks registered to provide VND285 trillion worth of loans at interest rates 0.5-1 percent lower than market interest rates.

According to Nguyen Quoc Hung, director of the Credit Department under the State Bank of Vietnam (SBV), the banks have disbursed VND80 trillion, or 30 percent of the package, to 47,000 borrowers, including farming households.

Experts warn that businesses suffering the most may not be able to access the VND285 trillion aid package because they cannot prove solvency.

BIDV, one of the four state-owned banks, or the ‘big four’, reported that it has disbursed VND28 trillion out of VND120 trillion it committed to lend. The amount to be disbursed depends on the enterprises’ absorption capability.

 


ACB registered to provide VND20 trillion, including two packages of VND5 trillion and VND15 trillion targeting different subjects.

According to Tu Tien Phat, deputy CEO of ACB, the amount of VND5 trillion targets existing clients who bear direct impact from Covid-19. The money will help them maintain operation and pay workers.

Meanwhile, the amount of VND15 trillion is reserved for all clients, including VND13 trillion for businesses with minimum interest rate of 6.5 percent, and VND2 trillion for individuals with minimum interest rate of 7.5 percent.

Hung said the main borrowers of the credit package are enterprises in the fields which bear little impact from Covid-19 and need capital to bounce back after the epidemic ends, such as production and agriculture, seafood and medical services, and electricity.

He explained that domestic consumption and demand for exports in rice, livestock, seafood and food will increase sharply after the epidemic ends. The capital will help businesses prepare for the post-epidemic period.

When public investment is accelerated by the government, banks will also prioritize to provide loans to enterprises in related fields such as sand, gravel and cement production.

However, Hung said enterprises that suffer heavily from the epidemic can access the credit package if they can prove solvency.

Banks are still providing capital to enterprises that have lost sources of revenue and still cannot pay debts because of Covid-19 in the fields of tourism, transport and textiles and garments.

However, Hung said that banks themselves are also businesses and they need to be sure that they can collect debts".

Therefore, enterprises which want to access low-interest loans, have to prove that their business results have decreased, and show their purposes for the loans and their ability to pay their debts.

Mai Lan 

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