The State Bank of Vietnam has structured the preferential lending program in two phases. The initial pilot phase, spanning from the present to 2025, will be spearheaded by Agribank. Subsequently, the program will enter an expansion phase, extending from 2025 to 2030, during which various credit institutions will participate.
Deputy Minister of Agriculture and Rural Development Tran Thanh Nam stated that to facilitate the allocation of loan capital for participants in the 1 million hectares of high-quality rice initiative, the Ministry of Agriculture and Rural Development has issued a decision to establish technical and economic standards for the production of high-quality, low-emission rice, which are derived from the technical and economic standards used in agricultural extension activities.
The Ministry has simultaneously collaborated with local authorities in the Mekong Delta region to establish specialized areas as part of the project. The Ministry has set forth criteria to engage enterprises, cooperatives, and cooperative groups in the project, outlining specific obligations and benefits.
Specialized agencies within the Ministry are working alongside localities to consolidate efforts. The Ministry of Agriculture and Rural Development will finalize the list and will officially partner with Agribank to create a transparent mechanism and implement a preferential loan program aimed at supporting the 1 million hectares of high-quality rice initiative, said Deputy Minister Nam.
By the conclusion of September 2024, credit allocated to the rice sector in the Mekong Delta is projected to reach approximately VND124,000 billion, reflecting an 18 percent increase from the end of 2023 and constituting about 53 percent of the total outstanding rice credit across the nation.
Previously, the State Bank of Vietnam presented to the Government the issuance of Decree No. 55/ND-CP and Decree No. 116/2018/ND-CP, which pertain to credit policies for agricultural and rural development. Notably, these decrees include various incentives for unsecured loans, policies promoting agricultural production through a linkage model, advancements in high-tech agriculture, special mechanisms for debt resolution, and interest rate reductions for clients acquiring agricultural insurance.
Specifically, the State Bank has implemented a policy to limit short-term lending interest rates to below 4 percent per annum for priority sectors, including rice.
