Central Bank studies circular revision to better support businesses

The State Bank of Vietnam (SBV) is studying amendment of Circular 01/2020 in order support more businesses affected by the Covid-19 pandemic, said deputy governor of SBV Dao Minh Tu at a conference on July 2.

According to Mr. Tu, commercial banks have made efforts to reduce costs and employees’ wage to focus on assisting customers affected by the pandemic. Specifically, loan interest rates have been lowered. The banks said that they would side by enterprises to survive together and control bad debts.

Implementing Circular 01, SBV branch in HCMC has reduced interest rate, restructured debts and provided low interest loans to 230,700 customers with the total value of VND386,610 billion (US$16.61 billion), said Mr. Hoang Minh Giam, director of the SBV HCMC.

Of them, 31,337 customers from five priority fields got loans totaling VND175,792 ($7.56 billion) with the interest rate of only 5 percent a year at the end of May. Small enterprises accounted for 72 percent of the total outstanding loans.

Under the Banks-Enterprises Connection Program 2020, 12 commercial banks have registered to attend a credit package of VND274,450 billion ($11.81 billion). At the end of May, the disbursement of this package hit VND127,391 billion ($5.47 billion) to 5,906 customers. 

In addition, the SBV HCMC has recently worked with Cu Chi District and some commercial banks in the district to organize a conference on agriculture and rural development. At the event, banks pledged to provide 46 customers with VND203.77 billion ($8.76 million) in loans. This takes the total number of customers loaned under the program to 6,393 with the total amount of VND129,519 billion ($5.57 billion) as of the end of June.

Deputy director general of Sacombank Phan Dinh Tue said that businesses have been facing difficulties so the Government and the SBV should have more drastic policies to help them clear capital difficulties.

Meantime, deputy chairman of HCMC Business Association Nguyen Phuoc Hung suggested that banks should further reduce procedures to help enterprises get access to preferential credit source and expand support to enterprises who suffered little damage or no damage due to the Covid-19 pandemic to recover and develop.

Stating at the conference, deputy chairman of HCMC People’s Committee Tran Vinh Tuyen said that the Covid-19 pandemic resulted in the city budget deficit of 14 percent. Appreciating efforts by the SBV HCMC, the city Department of Industry and Trade and district people’s committees to connect banks with businesses. The connection activities must be regularly implemented with responsibility and cooperation among agencies, districts and banks and persistent effort by each enterprise.

The city People’s Committee has established a specialized team to solve difficulties in capital, tax and insurance for businesses to boost production and trading. Hence agencies and districts should join hands and take action to implement this task.

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