Digital lending contributes to boosting Vietnam’s SMEs

Illustrative image (Source: internet)

Singapore (VNA) – Singapore's fintechnews.sg has published an article entitled "Vietnam's SMEs Get a Boost from Digital Lending" affirming that a strong import-export boom and positive digital trends are lending a helping hand to Vietnam's small and medium-sized enterprises (SMEs) to sustain growth.

According to the article, as much of the world experienced a recession, the Vietnamese economy continued to be robust, even recording growth out of a dour 2022.

Like most of Southeast Asia, SMEs play a vital role in the local Vietnam economy, accounting for well over 90% of all businesses there.

Vietnam's capabilities in the non-agricultural sector, including things such as textiles, manufacturing, construction, and the service industry, along with wholesale and retail trade will be important in the country's push to become a bigger part of global supply lines, according to the article.

It also mentioned that according to Organisation for Economic Co-operation and Development (OECD) in its study of SME and Entrepreneurship Policy in Vietnam, business R&D spending in SMEs in Vietnam is limited.

However, local SMEs appear to be quite innovative, especially in product and process innovation.

Now thousands of SMEs registered in Vietnam can receive aid in the form of digital lending support.

Fintech firms are establishing connections with commercial banks in the country to lend unsecured loans to individuals as well as to SMEs.

Interest in both consumer and business loans is steadily increasing, as is the number of digital lending fintechs, both local and international, in Vietnam.

Fintechs are working with other institutions in a number of different ways to offer credit facilities for Vietnamese businesses. 

International partnerships solidified digital lending capabilities that could empower SMEs in Vietnam to access better financial resources, improve production capacity, and embark on digital transformation drives, said the article.

These could in turn help SMEs ride the shift that Vietnam is undergoing, from exporting raw materials to pursuing opportunities in the global marketplace for processed products with higher added value. They will also help strengthen the country's participation in lucrative worldwide supply chains.

The article emphasised that alongside the invaluable opportunity for local businesses to join and expand export markets, the demand for local consumption is also slated to increase if the economy remains robust.

Fintechnews.sg is part of the Fintech News Network which was launched in 2015, specialising in delivering fintech-centric content, opinions and analysis on fintech applications./.