Commercial banks need to change their perception of small andmedium-sized businesses to boost lending for businesses, said head ofthe Central Institute for Economic Management (CIEM) Vo Tri Thanh.
Headded that many banks are unwilling to provide loans to the small- andmedium-sized business (SME) community due to low profits and additionalexpenses. This perception should change and SMEs should also reorganisetheir administrative affairs and production, while improving their linkswith banks, according to Tin Tuc newspaper.
Thanh affirmed thatSMEs outnumber big firms and can generate a large credit market.Therefore, banks should pay more attention to SMEs because this willbenefit the banks too.
According to Thanh, there are creditguarantee funds for SMEs across the world. However, some work well,while some others do not. In Vietnam, the fund is not necessarilyguaranteed by the State so that private companies, associations, andunions can join it to improve their guarantee levels and credibility andenable them to access bank loans.
Cao Sy Kiem, Chairman of theVietnam Association of Small and Medium-Sized Enterprises, said that itneeds to strengthen the links between SMEs, and help them in all aspectsof cooperation, financial support, legal consultation and marketexpansion to become a strong SMEs community with transparent activitiesto increase their access to bank loans.
According to Tran QuocHung, Deputy Director of the State Bank of Vietnam's branch in Hanoi,over the past three months, around 23 commercial banks and branches ofall commercial banks have registered to participate in a programme toboost links between banks and businesses, with a committed loan of 17.8trillion VND (838 million USD).
Nguyen Hoang Minh, DeputyDirector of the State Bank's branch in Ho Chi Minh City, said that underthis programme, the amount of non-collateral loan given, as of July 10,was 15.6 trillion VND (732 million USD), accounting for 17 to 18percent of the total outstanding loans. A Vietinbank leader, who did notwish to be identified, said that his bank has established an ad-hoccredit unit to help SMEs get access to loans.
This unit will beresponsible for collecting reliable information about banking, finance,production and the performance of businesses.
To promote trustin lending, Deputy Governor of the central bank Nguyen Thi Hong saidthat banks have their regulations for trust loans and commercial bankshave their own unique products.
Banks have to assess the business plans, financial capability and the repayment capacity of the borrowers.
InVietnam, banks face difficulties in getting information about theborrowers. Thus, the bank governor wants closer links between banks andbusinesses with the participation of the local authorities who knowabout the performance of firms operating in their provinces. By doingso, banks will have more information about the borrowers.
Kiemsaid that in this context, besides the support from the State, banks andenterprises must work together to resolve the difficulties.
In addition, businesses themselves have to use advanced administrative management methods to utilise the bank loan effectively.-VNA
Headded that many banks are unwilling to provide loans to the small- andmedium-sized business (SME) community due to low profits and additionalexpenses. This perception should change and SMEs should also reorganisetheir administrative affairs and production, while improving their linkswith banks, according to Tin Tuc newspaper.
Thanh affirmed thatSMEs outnumber big firms and can generate a large credit market.Therefore, banks should pay more attention to SMEs because this willbenefit the banks too.
According to Thanh, there are creditguarantee funds for SMEs across the world. However, some work well,while some others do not. In Vietnam, the fund is not necessarilyguaranteed by the State so that private companies, associations, andunions can join it to improve their guarantee levels and credibility andenable them to access bank loans.
Cao Sy Kiem, Chairman of theVietnam Association of Small and Medium-Sized Enterprises, said that itneeds to strengthen the links between SMEs, and help them in all aspectsof cooperation, financial support, legal consultation and marketexpansion to become a strong SMEs community with transparent activitiesto increase their access to bank loans.
According to Tran QuocHung, Deputy Director of the State Bank of Vietnam's branch in Hanoi,over the past three months, around 23 commercial banks and branches ofall commercial banks have registered to participate in a programme toboost links between banks and businesses, with a committed loan of 17.8trillion VND (838 million USD).
Nguyen Hoang Minh, DeputyDirector of the State Bank's branch in Ho Chi Minh City, said that underthis programme, the amount of non-collateral loan given, as of July 10,was 15.6 trillion VND (732 million USD), accounting for 17 to 18percent of the total outstanding loans. A Vietinbank leader, who did notwish to be identified, said that his bank has established an ad-hoccredit unit to help SMEs get access to loans.
This unit will beresponsible for collecting reliable information about banking, finance,production and the performance of businesses.
To promote trustin lending, Deputy Governor of the central bank Nguyen Thi Hong saidthat banks have their regulations for trust loans and commercial bankshave their own unique products.
Banks have to assess the business plans, financial capability and the repayment capacity of the borrowers.
InVietnam, banks face difficulties in getting information about theborrowers. Thus, the bank governor wants closer links between banks andbusinesses with the participation of the local authorities who knowabout the performance of firms operating in their provinces. By doingso, banks will have more information about the borrowers.
Kiemsaid that in this context, besides the support from the State, banks andenterprises must work together to resolve the difficulties.
In addition, businesses themselves have to use advanced administrative management methods to utilise the bank loan effectively.-VNA
