Workshop on "Credit Solutions for Small and Medium Enterprises"

Attending the workshop were representatives of many SBV departments, agencies, such as: Economic Credit Department, Monetary Policy Department, Monetary Forecasting & Statistics Department, Banking Strategy Institute, Legal Department, Banking Supervision Agency, Vietnam Asset Management Company (VAMC), and Communication Department. Especially, the workshop also welcomed the presences of VCCI leaders, representatives of associations, enterprises, credit institutions and many economists, finance and banking experts.

The workshop was organized with the aim of promoting more credit resources for Small and Medium Enterprises (SMEs), boosting capital to the economy, providing solutions to unlock credit capital, eliminating obstacles and difficulties, stabilizing SMEs development and contributing to the overall development of the economy.

At the workshop, Mr. Doan Duy Khuong - Vice Chairman of VCCI stated that SMEs currently account for about 97% of total enterprises operating in Vietnam, contribute about 45% of total GDP, 31% of total budget revenue and attract more than 5 million workers. Aside from great contribution to economic development, SMEs community is also playing a great part stabilizing labor market, helping the economy to overcome risks and to develop stably and sustainably.

SBV Deputy Governor Dao Minh Tu spoke at the Workshop

For banking sector, SMEs are identified as the driving force for the development of national economy, which is one of the five prioritized sectors to supply capital investment for development. Over the past years, following the National Assembly's resolutions, the Prime Minister and the Government's guidance, SBV has implemented various solutions and policies to help solve difficulties for SMEs in accessing bank credit capital to maintain and expand production and business. The State Bank of Vietnam (SBV) has actively and flexibly used and operated monetary policy instruments for controlling inflation, gradually lowering interest rates, stabilizing exchange rates; thereby, contributing to the macro-economic stability, creating a favorable business environment and expanding credit effectively. SBV also directed credit institutions to balance capital resources to properly meet capital needs in prioritized sectors, including SMEs.

Speaking at the workshop, SBV Deputy Governor Dao Minh Tu emphasized that credit solutions for SMEs are not new but never old. Because in reality, businesses still face difficulties in accessing capital, while commercial banks also have difficulties expanding credit for SMEs. However, Deputy Governor said that this situation has been resolved positively through the State’s mechanisms such as the Government’s Resolution 19 and Resolution 35. SMEs have acknowledged the drastic measures taken by the Government, especially when the National Assembly passed the Law on SMEs.

Overview of the Workshop

"We should stop complaint it difficult, but instead let’s suggest more measures to solve the problem. Those measures will help management agencies to quickly complete the solution for SMEs", Deputy Governor stressed.

According to Mr. Mac Quoc Anh - Vice President and General Secretary of the Hanoi Small and Medium Enterprises Association, SMEs not only need to obtain enough capital, but they have to find ways to use capital effectively. In the process of lending, the bank will supervise customers before, during and after the disbursement, forcing enterprises to use the capital for the right purpose and efficiently.

Attending the workshop, representatives of credit institutions presented about comprehensive financial solutions for SMEs. Mr. Nguyen Dinh Vinh - Deputy General Director of Vietinbank said that VietinBank has developed a comprehensive financial solution to serve and meet the diverse needs of this group of customers. Accordingly, VietinBank focuses on 3 main groups of solutions including: Credit and product policy solutions; Solutions on interest rate policy; and Solutions on customer care policy. "VietinBank commits to accompany customers toward the prosperous development, sharing difficulties and cooperating on the basis of offering solutions and financial consultancy for customers." Mr. Vinh emphasized.

On that same note, Mr. Dao Gia Hung - VPBank Deputy Director of SME Banking said that the VPBank designs its products on the basis of disadvantages of SMEs, to solve difficulties for SMEs, not demand, because 100% businesses has the demand for a loan not just SMEs."

Also at this conference, many economic experts shared the same view that credit relations between commercial banks and enterprises, especially SMEs, have been much improved in the direction of openness, closer and more efficient. During the discussion, businesses have the opportunity to share about the reality of their business loans, proposals and recommendations.

SBV Deputy Governor Dao Minh Tu concluded the Workshop

After listening to all opinions from experts, businesses as well as commercial banks, SBV Deputy Director Dao Minh Tu believed that commercial banks need to regularly exchange and connect with business associations to understand and have a more positive view of enterprises, especially SMEs.

Deputy Director also suggested commercial banks should coordinate with Government ministries, departments and agencies to increase credit capital and create preferential conditions for SMEs. CIs should also take responsibility for SMEs not only as a obligation to satisfy their business objectives but also CIs’ responsibilities. On the side of SMEs, it is required for these businesses to be more transparent about finance, money flow, and to be loyal with banks.

Regarding lending interest rates, the Deputy Governor affirmed that the Government and the State Bank of Vietnam would like to reduce the interest rate; and if conditions permit, SBV will continue to lower the lending interest rate. "However, banks are just intermediary, when talking about interest rate, we cannot just look at the output, but also the input. The increase or decrease interest rate depends a lot on the conditions of the economy."

VA