Vietnam’s Getting Credit Index in world’s Top 30

11-Nov-2017 Intellasia | VGP | 6:00 AM Print This Post

According to the World Bank’s Doing Business Report 2018, Vietnam’s Getting Credit Index ranks 29th out of 190 surveyed countries, scoring 75 on a 100 scale.

As such, the index has met the objective set out in the Banking Sector Action Plan, contributing to improving the business environment, enhancing national competitiveness, supporting and developing the business sector in 2016-2017, with orientation to 2020.

Compared to 2017, this Index has increased five scores and improved three levels. The Index was assessed on the basis of such criteria as: the strength of legal rights (8/12 points), depth of credit information (7/8 points), the coverage of public credit information (51 percent) and the coverage of private credit information (19.7 percent).

In particular, Vietnam has continuously earned high scores over many years for the two criteria including the depth of credit information (7/8) and the coverage of public credit information (51 percent), much higher than East Asia Pacific region (4.2/8 and 16 percent) and the OECD (6.6/8 and 18.3 percent).

Compared with other regional countries, Vietnam’s access to credit is lower than Malaysia (20th) and higher than Indonesia (55th), Laos (77th), and the Philippines (142th).

On benchmarking, Vietnam’s getting credit index reached 75/100, up five scores from 2017 and higher than the average for East Asia-Pacific (57/100 points).

According to World Bank’s assessment, apart from grading the above mentioned traditional criteria, the increase in grade and scores of the Index in 2018 is due to positive changes in the Civil Code 2015 which has been newly adopted by Vietnam since January 1, 2017.

Specifically, Vietnam has made a broader list for the range of collaterals in this Code, thereby improving the accessibility to credit, creating more favourable conditions for businesses to develop.

Credit is the core element of a business. Open credit policy and much support will help businesses feel secured in investment, production and business.

The improvement of the Index takes place in the context that the government of Vietnam in general and the State Bank of Vietnam in particular is working to improve the business environment and national competitiveness in 2017, orienting to 2020.

 


Category: Finance

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