Credit support for SMEs creates more opportunities for businesses

Since Law on Support for SMEs took effect (1 Jan 2018), SMEs have had advantages and incentives in production and business activities, such as incentives in taxes, land lease, especially credit. These incentives are helping enterprises have the resources to develop business.

Many incentives

To prepare raw materials for last months of the year, N.V.N., director of a farm export company in Tan Uyen town, needed a few a short-term loan worth several billions VND. Because there were no orders, his enterprise had no L/C (letter of credit), and was not in priority. Mr. N. went to Maritime Bank with little expectation, but the results were beyond his expectation. "I am quite surprised because the bank offered incentives for small businesses like us with competitive interest rate from 6.99% per year. Thanks to the dedicated consultancy of credit officers, it only took a few days to file a loan. The bank offered reasonable interest rate and repayment schedule, I quickly received disbursement after the loan was approved, meeting the need for replenishing capital even in very urgent circumstance", N. said.

Commercial banks see SMEs as potential customers and are focusing on serving these clients. In photo: Customers make transactions at HDBank - Binh Duong branch.

Not only offering loans with reasonable interest rates, a representative of Maritime Bank said that lately, the bank paid attention to specific characteristics, namely quick working capital, flexible conditions, to meet the needs. According to the representative of Maritime Bank, attaching importance to the quality of financial services and solutions that are closest to practical needs of businesses is what not only Maritime Bank but also other banks are doing to stimulate credit growth in last months of the year.

In fact, bank credit for SMEs plays a very important role, contributing to the development of this sector. However, according to statistics at the latest Vietnam Economic Forum, over 60% SMEs in the country could not access bank loans. Therefore, credit incentive policies, programs offering lower interest rates to SMEs from commercial banks are now opening more opportunities for enterprises.

Le Ba Linh, Deputy Chairman of Binh Duong Sculpture and Lacquer Association, said that in the latest two years, the government had policies to support economic growth, such as taking measures to reduce lending rates, encourage credit growth in prioritized sectors ... Thus, enterprises benefited from cheap capital, as well as better access to capital. At the same time, commercial banks also actively introduced programs, products, services, and solutions to SMEs to improve their situation. "At the moment, commercial banks are welcoming SMEs. This is good news, because in the context of difficult economy, SMEs want to find a bank with reasonable lending interest rates and simple procedures. In addition, what SMEs need from banks is to be understood and supported more, especially while looking for capital, "said Mr. Linh.

Focusing on SME customers

A recent report by State Bank of Vietnam said that commercial banks currently saw SMEs as potential customers. The number of SMEs in the banking sector tended to increase over the years, with many small and medium-sized banks providing loans to SMEs up to approximately 70% of their outstanding loans. In addition, a number of branches of state-owned banks also had outstanding loans to this client type has achieved double-digit growth rates.

Tran Ngoc Linh, Director of BIDV - Binh Duong Branch, once shared the view that SMEs were their target client. Besides preferential lending rates, BIDV support comprehensively, namely financial solutions, simplification of the process ... then preferential loans to SMEs.

A representative of Viet Capital Bank said that bank capital for SMEs played a very important role, contributing to promoting the development of this sector. However, according to statistics, more than 60% of SMEs in the country are not able to access to bank capital. Therefore, from now until the end of 2018, the bank applied a credit package worth VND1,000 billion supporting SMEs, preferential interest rate of only from 8.5% /year. As a result, all SMEs borrowed loans of Viet Capital Bank for the first time or have already made a payment from 6 months to the time of applying for credit will definitely reach this package.

This package is one of the activity series to be launched every year in order to help remove financial problems of SMEs. With the message "We start with you" and the orientation to develop the customer group of businesses “To us, small businesses are big customers", Viet Capital Bank offers special loans, focuses on improving service quality, expanding market, as well as personnel structure of SME segment", said the representative.

Together with SMEs, with the efforts to support the national economy, commercial banks are contributing to the development of SMEs nowadays.

Reported by Thanh Hong – Translated by Ngoc Huynh

• Local real estate market strongly attracts foreign investors (20/04)
• HCM City moves towards Net Zero (19/04)
• Further setting up project on entrusting loans to officials, civil servants and public employees for buying social housing apartments (19/04)
• Firm steps of reforms (19/04)
• To test try consensus of moving enterprises north, Binh Duong province (19/04)
• Provincial enterprises are ready to join the global supply chain (19/04)
• Exhibition aims to foster cooperation in smart urban development (18/04)
• Strengthening support for German enterprises to invest in Binh Duong (17/04)