Lack of capital for production and business operations - worry free

 In the context where businesses still face many difficulties, commercial banks have introduced support packages to enhance business efficiency, stimulate credit demand in 2024.

Banks strive to achieve a 15% credit growth target in 2024. In the photo: Transactions at the BIDV Hoa Phu Transaction Office in Thu Dau Mot city.

Proactively preferential capital sources

To meet the investment capital for production, business, and consumer loans at the beginning of 2024, some banks have implemented low-interest credit programs, a package of solutions to support enterprises. Specifically, Vietnam Bank for Industry and Trade (Vietinbank) is offering a preferential package of up to 300,000 trillion dong, special preferential interest rates, starting from 5% per year for VND. The implementation period is from now until the end of April 2024. The competitive interest rate for loans is prioritized for enterprises engaged in import-export activities, operating in priority sectors as directed by the Government and the State Bank.

Accompanying the expansion of international trade with import-export businesses, from now until the end of 2024, the Bank for Investment and Development of Vietnam (BIDV) is also implementing a preferential exchange rate program of up to 170 points. For new customers, this bank waives nearly 10 service fees within 1 year.

Beside that, currently large enterprise customers can access preferential short-term interest rates lower than the normal borrowing rate by up to 2% per year from the Agriculture and Rural Development Bank (Agribank) to supplement working capital to implement production and business plans. The program targets businesses with effective business plans, efficient operations, and short-term capital needs. Since the beginning of the year, this bank has proactively adjusted down lending interest rates, implemented credit programs totaling over 120,000 trillion dong with lower interest rates ranging from 2.5-3% per year compared to normal interest rates to encourage and support customers. At the same time, implement credit incentives for enterprise customers investing in projects in 6 key sectors (fixed interest rate in the first year starting from only 6% per year); small and medium enterprises (SMEs) borrowing additional short-term working capital (interest rate lower than usual by 1.5% per year).

The lowest interest rate in 20 years

The economic picture in 2024, despite facing many challenges, is seen by many experts as a pivotal year for breakthroughs, building on the achievements of 2023 and the prospects for public and private investment at home and abroad. Additionally, the trend of decreasing interest rates in recent times has also stimulated the demand for loans from businesses. Banks with strong financial capabilities are implementing large-scale preferential credit programs, covering all segments, from SMEs, large enterprises to foreign-invested enterprises.

Mr. Do Thanh Son, Deputy General Director of Vietinbank, believes that Step up is Vietinbank's commitment to accompanying businesses in overcoming challenges in the market, creating conditions for businesses to access capital at good prices, reducing financial pressure to focus on accelerating business. According to this leadership, besides offering preferential interest rates on a large scale, Vietinbank also continuously streamlines processes, simplifies documentation, and procedures to support businesses in accessing capital more quickly. With a network of 155 branches and nearly 1,000 transaction offices spread across 63 provinces and cities nationwide, Vietinbank is always ready to be a reliable companion for the business community on every stage of development.

At a recent conference to boost bank credit to support businesses and promote economic growth in 2024, Mr. Dao Minh Tu, Deputy Governor of the State Bank, stated that the agency has continuously reduced the operating interest rates four times in 2023, with a reduction of 0.5-2% per year. By now, the interest rates for new deposit and lending of commercial banks have decreased by more than 2% per year compared to the end of 2022. The deputy governor also assesses that the lending rates are at their lowest level in the past 20 years.

Regarding the credit prospects in 2024, Mr. Dao Minh Tu predicts that there are many signs of economic recovery in 2024, surely the investment demand of the economy will increase, thus there must be resources to meet the investment and development needs. According to Mr. Dao Minh Tu, alongside this factor, in order to increase credit, it must depend on factors such as interest rates. Therefore, currently, interest rates have decreased, lower than before the pandemic. This is one of the fundamental factors for credit may increase significantly again.

Regarding the local currency situation, Mr. Vo Dinh Phong, Director of the State Bank - Binh Duong Branch, also believes that the deposit and lending interest rates in the area have decreased. Credit institutions have proactively reduced costs to lower lending rates. To increase credit growth in the future, the State Bank - Binh Duong Branch has proposed solutions. Among them, enhancing communication on programs, policies, and government directives of the State Bank to customers. With that, direct credit institutions to increase safe and efficient credit growth, directing credit towards priority production sectors and business fields. Thereby, creating favorable conditions for enterprises and people to access bank credit capital, expanding credit to serve production, business, and life services, consumption.

Reported by Thanh Hong – Translated by Vi Bao