After one implementation year, the banks – businesses connection program in the province had 2 credit signings between 7 businesses and banks. Businesses participating in the program were granted loans timely with preferential interest rate (0.5 - 1% lower than the common average interest rate) of 8-9%/year to short-term loans and 10-11% to medium and long-term loans.
Initial successes
According to Mr. Bui Van Nu, director of the State Bank of Vietnam (SBV) - Binh Duong branch, the banks – businesses connection program was having positive signals. Thanks to seminars, discussions between banks – businesses, opinions of businesses, agencies reflected difficulties in accessing bank loans. Thereby, provincial banks and localities put forward specific measures to overcome difficulties, assist business activities, enhance local socio-economic development.
Businesses also rebuilt up their business plans corresponding to local socio-economic situation. This is one condition for credit institutions i.e. banks to grant loans to businesses. Besides, businesses participating in the program received financial support in terms of capital, credit and interest rates to enhance their competitive capability.
Clients performed transactions at Bank for Investment and Development of Vietnam (BIDV) - Binh Duong branch.
Ms. Nguyen Thi Tham, owner of Tan Thanh Trading - Manufacturing and Construction Company, said, said she was very excited about the signing of credit limit increase in 2014. Ms. Tham said, banks – businesses connection seminar was an opportunity for businesses to share difficulties with competent authorities and the banking sector for appropriate remedies.
Focusing on some prioritized areas
According to Mr. Bui Van Nu, the banks – businesses connection program generally achieved positive results. The success of the program came from an active collaboration between State management agencies, Department of Trade and Industry, Association of industries; especially localities, like: Phu Giao district and North Tan Uyen district, joining and supporting the program, helping businesses to overcome difficulties and develop their production.
However, during the implementation process, there were still some problems, such as: some small and medium enterprises (in Phu Giao district and North Tan Uyen district) encountered difficulties in price, output, lack of feasible production plans. Additionally, the mortgaged asset valuation between banks and enterprises has faced obstacles, because of the lack of assessment standards affecting credit limit as well as credit line. Meanwhile, some enterprises having feasible production plans but not having qualified mortgaged asset have not been able to get a loan.
Mr. Bui Van Nu suggested that enterprises not having qualified mortgaged asset would be able to take out loans through mortgaging cash flow or unsecured loans. Banks should also actively raise medium and long-term capital to offer fixed interest rates.
According to SBV - Binh Duong branch, until the end of 2015, banks participating in the program will seek to complete disbursement of credit package at the highest level. Besides, in the future, Binh Duong will aim at removing business’s difficulties through preferential policies, and creating favorable competitive environment; ensuring promotion of market factors for business’s sustainable growth in the international integration. In addition, , the program will focus on some prioritized fields, like: auxiliary industries, high-tech agriculture, personnel training ...
Reported by T.Hong – Translated by Ngoc Huynh
