reduced lending interest rates

The State Bank of Vietnam (SBV) is cutting down a series of key interest rates by 0.25 percent-0.5 percent from June 19, which is expected to make a double impact on the economy thanks to stronger credit activities and higher liquidity.

The State Bank of Vietnam (SBV) announced on February 23 that it had issued Official Letter No. 953/NHNN-TD, which outlines the continuation of the bank-business connection program.

Many experts said that interest rates in Vietnam are currently too high, so it is necessary to reduce them to support people and enterprises to recover and develop production and business activities.

With an abundant source of money, many banks have launched credit stimulus packages and reduced lending interest rates for corporate and institutional customers.

By June 16, the credit growth of the banking industry merely reached 2.13 percent compared to the beginning of this year. Thus, in the first nearly six months of this year, credit growth was only half of that in the same period last year due to the serious impacts of the Covid-19 pandemic.

To support enterprises and borrowers affected by the Covid-19 pandemic, banks have simultaneously cut their interest rates by 0.5-2.5 percent per annum for loan packages.

Even after commercial banks capped the deposit interest rate at 14 percent and cut lending interest rates, companies continue to complain of their inability to borrow capital at 21-24 percent per year.