Businesses struggle to access city backed loans

Many businesses, particularly small-and medium-sized, have found it difficult to access bank loans through HCM City’s economic stimulus program, said many participants at a meeting between businesses and commercial banks held on April 9 in HCMC.

A Sacombank staff member deals with a customer in HCM City. Many businesses, particularly small-and medium-sized, have found it hard to access bank loans through HCM City’s economic stimulus program.

At the meeting, organized by the HCMC Trade and Investment Promotion Center, representatives from the Vietnam Development Bank and the Central Bank introduced new credit policies, including loan guarantees, subsidies for interest payment for medium and long-term loans, and support for laid-off workers.

However, many businesses complained that they were facing many problems in getting loans or obtaining loan guarantees. They lacked assets to use as mortgages required by banks, or their business plans which use loans as capital, were assessed to be inefficient.

As of April 9, 130 HCMC businesses have applied to the HCMC Trade and Industry Department for loans totaling more than VND7.75 trillion (US$445 million), and 19 have been granted a total of around 1 trillion, said the department.

Out of the remaining 111 businesses, 33 want short-term loans but they are of too small a scale and have no ability to repay loans. The department has referred them to the Bank for Investment and Development, and the Credit Guarantee Fund for Small and Medium Sized Enterprises for support.

The 78 other businesses, which want long-term loans, have been referred to the HCMC Fund for Urban Development and Investment for consideration.

The department commented that many businesses do not know about the city’s lending policy, so the number of applications is still modest.

Businesses whose applications are uncompleted should rapidly complete them soon for consideration, the department urged.

By staff writers – Translated by Truc Thinh

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