Enterprises ask to receive preferential interest rates and extend debt restructuring term

On April 1, in Thanh Hoa, the State Bank of Vietnam (SBV) coordinated with the People's Committee of Thanh Hoa province to organize a conference to connect banks and businesses.

Facilitating access to capital

At the conference, leaders of the banks pledged to continue to implement support measures and preferential credit programs to share difficulties with customers affected by the Covid-19 pandemic; effectively implement the Government's national comprehensive financial strategy.

Commercial banks have signed a commitment to provide credit of VND21,055 billion to businesses in Thanh Hoa.

However, with the need to expand investment for production and business, businesses all expressed their desire to grant more credit and create more favorable conditions for accessing loans.

According to Cao Viet Tam, Chairman of Sam Son Business Association, recently, almost 100% of service and tourism businesses have no revenue. Many banks have implemented policies to support businesses, but businesses want to be supported in long-term development, and have practical policies on debt freezing, debt rescheduling, and reducing loan procedures.

Also on this issue, Nguyen Hong Phong, Chairman of the Board of Directors of Tien Nong Agricultural Industry Joint Stock Company, said that the start-up capital of the enterprise is only VND200 million, so it has to borrow from a bank to operate.

As a result, the enterprise now has a scale of VND750 billion, creating jobs for more than 600 employees.

However, in order to create more favorable conditions for businesses in terms of capital for investment and development, Phong suggested that there should be a preferential interest rate policy and an appropriate valuation of assets to secure loans for the agricultural sector.

Trinh Xuan Lam, Chairman of the Board of Directors of Thien Son Garment Joint Stock Company, said businesses really need cash flow from banks.

The company currently has 10 factories with more than 12,000 employees, the company has a loan balance of VND300 billion but still wants to borrow another VND600 billion to expand production. Therefore, Lam suggested that banks create favorable conditions, especially in terms of administrative procedures, collateral for businesses to borrow.

With the needs of businesses in Thanh Hoa province, Do Trong Hung, Secretary of the Provincial Party Committee, Chairman of the People's Council of Thanh Hoa province proposed the State Bank a number of contents on the promulgating the Law on Bad Debt Handling, adjusting and amending a number of circulars in the banking sector to suit the actual situation, allowing the extension of time to restructure the repayment term and the exemption and reduction of interest, fees for customers until June 30, 2023, to facilitate people and businesses to stabilize production and business in the context of the complicated development of the Covid-19 pandemic.

Banks face many challenges

Speaking at the conference, Governor of the State Bank Nguyen Thi Hong said that the banking industry had implemented solutions to manage monetary policy and banking activities in order to control inflation and stabilize the macro-economy; continue to actively implement credit programs and policies for industries and fields, and prioritize credit investment in priority areas.

Governor of the State Bank of Vietnam Nguyen Thi Hong spoke at the Conference.

However, according to the Governor, due to the impact of the Covid-19 pandemic, the operation of businesses and people in Thanh Hoa province encountered some difficulties.

Specifically, the majority of enterprises in the province are small and medium-sized enterprises, with low equity and financial capacity; many people and some business owners are not yet equipped or have not been able to access digital services; while bad debt settlement is still difficult and often takes a long time.

Governor Nguyen Thi Hong also pointed out the challenges that the banking sector has to face, which is the risk of inflation due to many objective and subjective factors, domestic and foreign, the impact of trade policies, tight monetary policies, the shift of investment capital flows of some large countries, along with many pressures from the domestic economy.

Besides, there are difficulties such as slow capital turnover, broken cash flow, reduced revenue, businesses experiencing a decrease in revenue, inability to pay their due debts, and an increase in debt recovery risks.

Therefore, leaders of the State Bank asked banks to focus capital on key projects with spillover effects for economic development; creating favorable conditions for customers to access bank credit capital on the basis of reviewing, simplifying and shortening processes and procedures, along with strictly complying with the provisions of the law, do not loosen credit-granting conditions to ensure loan safety when expanding credit.

Along with that, Nguyen Thi Hong also suggested that businesses need to strengthen their management and administration capacity, restructure their operations, and develop an effective production and business transformation plan in line with reality as a basis for credit institutions to appraise and lend.

Enterprises need to actively coordinate with credit institutions to provide relevant information and documents in accordance with the law in order to enjoy state support policies and appropriate support policies.