(VOVworld) – A program connecting banks and businesses was launched in Ho Chi Minh City 3 years ago to provide low interest loans to enterprises. It has enabled local businesses to maintain stable production and business growth. The State Bank of Vietnam intends to duplicate the program nationwide.

An employee of Ba Huan Company is at work in a poultry processing plant in Long An Province (Photo: Hung Le)

In July, 2012, the Ba Huan Company, Vietnam’s largest poultry egg supplier, wanted to expand its breeding farms but didn’t have enough capital and couldn’t afford the interest rate, which at that time was between 15% and 18%.

The bank-business connection program came at the right time, helping Ba Huan obtain a bank loan for 320,000 USD at 7% interest. Ba Huan invested the money in a high-tech poultry farm on 18 hectares in Binh Duong province for 700,000 birds.

Since then the company has continued to receive loans from Sacombank and BIDV at prime rates and enabling it to build a poultry processing plant in Long An province.

Pham Thanh Hung, the company’s Deputy Director, said that “thanks to bank-supplied capital at stable interest rates, we’ve been able to expand our production and sales, boosting our total turnover.”

The program has provided a total of 66.5 million USD in soft loans to 6,300 customers over the past three years.

 

Representatives of banks sign an agreement to provide a credit package of VND128 trillion for businesses in HCMC in 2015 (Photo: SGGP)

Since the beginning of this year, the Ho Chi Minh City Branch of the State Bank of Vietnam has loaned businesses nearly 3.5 billion USD at preferential rates between 6% and 9%.

There are 9 agencies businesses can contact for loans. They are the municipal Department of Industry and Trade, people’s committees of 24 districts and sub-districts, the management boards of industrial parks and export processing zones, the city’s business association, and professional associations.

A program hotline is available to the public at (08) 38211230. Any enterprises with problems or proposals regarding the program can call this number. So far 30 enterprises have received preferential loans through the hotline.

22 banks have joined the program and starting this year farmers can also take advantage of the program.

According to Deputy Director of the Agribank in Cu Chi district Le Van Dung, the bank“will continue the government’s policy of increasing investment in agriculture. In addition to farmers, production cooperatives which use advanced or green technologies can benefit from the program.”

Nguyen Hoang Minh, Deputy Director of the central bank’s Ho Chi Minh City branch, said “the firms that have feasible production plans but fail to meet the requirements for mortgage will be helped to get credit or unsecured loans. Sale-based capital loans will also be available. We’ll work with commercial banks to mobilize more medium- and long-term capital to stabilize interest rates for long-term loans.”