Vietnam Bank Association (VNBA) recently petitioned the government to allow financial companies to join demand stimulus lending programme.
According to VNBA, as per Decision No 131/QD-TTg of the prime minister on lending rate supporting programme to institutional and individual borrowers for their business and production, only commercial banks and Central People’s Credit Fund are allowed to join the programme.
Meanwhile, in the Decree No 79/2002/ND-CP dated, October 4, 2002 and another No 81/2008/ND-CP dated July 29, 2008, financial companies are allowed to supply short, medium and long-term loans in accordance with the State Bank of Vietnam’s (SBV) regulations.
At present, Vietnam has 15 financial companies with total short-term outstanding loans of over 15 trillion dong. Thus, VNBA said that the disallowance of financial companies to carry out Decision 131 would create serious problems.
Firstly, thousands of corporate customers who had borrowed from the financial companies’ will not enjoy interests under this decision and they could switch over to borrow capital from commercial banks.
Secondly, new customers would not come to borrow capital from financial companies as they will not be able to take advantage of the preferential lending rate.