VietNamNet Bridge – With the year's peak shopping season, the Tet holidays, approaching, shopkeepers at traditional markets in HCM City are in dire need of funds to stock goods and have to borrow from moneylenders at usurious rates since they cannot get bank loans.


A weekend fair in HCM City's Nha Be District. Stall owners in the city's markets are finding it difficult to raise money to stock up with goods for the Lunar New Year holidays. (Photo: VNS)
Lieu, owner of an egg stall in Ba Chieu market on Binh Thanh District's Phan Dang Luu Street, said demand will triple during the Lunar New Year holidays and therefore she requires around VND50 million (US$,2550) to stock goods.


But she could borrow only VND10 million from a bank, she said.


Some lenders like Sacombank and Eximbank offer loans to traders in traditional markets but require the stall to be mortgaged and an attestation from the market management board.


Yet, they will only lend up to 70 per cent of the stall's worth.


In fact, Tran Thi Nhieu, head of the Ba Chieu market management, said, "For the sake of safety, the management board recommends to banks to offer a maximum of 30 per cent for a maximum term of three months."


Most of the shopkeepers want to borrow between VND70 million and VND100 million compared to VND15 million-VND20 million in normal times, she added.


Some 30 stall owners in Ben Thanh market have been lucky to get bank loans of VND20 million to VND200 million.

But many others are not so lucky. The owner of a clothes shop at the market, for instance, said she had to borrow from moneylenders at interest rates of 10 per cent a month - even 20 per cent.


Another small trader in Go Vap District complained that she has had to borrow from moneylenders since she does not have ownership of her market stall to mortgage to the bank.

Moneylenders ask for no mortgage but borrowers have to repay in time or their "prestige will be tarnished", she said.

She has to pay VND100,000 in interest daily on the VND10 million she borrowed, or 30 per cent a month.


Some market management boards and associations have mobilised funds and lent to traders but they meet only a fraction of the demand.


The Binh Thanh Women's Association, for instance, has lent less than VND10 million each to 15 shopkeepers and traders at Ba Chieu market at an interest rate of 1.5 per cent a month.


VietNamNet/Viet Nam News