SBV Governor orders actions to prevent farm produce congestion due to capital shortage

Hanoi (VNA) – Governor of the State Bank of Vietnam (SBV) Nguyen Thi Hong has asked the banking system to make efforts to promptly meet the demand of people and enterprises for credit with reasonable terms and interest rates serving their production and trade of key agricultural exports.

At a December 13 conference on credit solutions to promote the purchase, consumption and export of key agricultural products in the Mekong Delta taking place in Can Tho city, the SBV chief requested credit institutions continue to focus their capital on production and business areas, especially the agriculture and rural development sector.

She tasked SBV’s chapters with closely monitoring lending activities of credit institutions and the situation of purchase and export of key agricultural products in their localities, ensuring banking operations to promptly and fully meet local demand for credit and preventing the accumulation of farm produce due to a lack of capital.

The Mekong Delta, an area with great potential and advantages for the development of the farming industry, is the largest production and export hub of aquatic products, rice and vegetables in the country.

At the event, Dao Minh Tu, SBV Deputy Governor, informed participants that as of the end of November, banking activities in the region have posted positive indicators.

Accordingly, the volume of capital mobilised exceeded 718.9 trillion VND (30.29 billion USD), an increase of 8.68% compared to the end of 2021. Outstanding loans, meanwhile, hit over 955.45 trillion VND, up 13.53%. Of the total loans, those for agriculture and rural development neared 540 trillion VND, rising by close to 15%.

The figures demonstrated that the credit capital flow of the banking industry has so far focused on sectors of the Mekong Delta’s strengths, making an important contribution to promoting socio-economic development of the region and the nation, Tu said.

Participating associations and enterprises took the occasion to present difficulties and problems facing them in their relations with credit institutions.

Hoang Van Nhut, Director of the Can Tho-based Hoang Minh Nhat Joint Stock Company, proposed the SBV and Government continue to devise long-term and sustainable financial support policies for the business community so that enterprises can be proactive in finance planning serving their effective operations.

In response, credit institutions joining the event were committed to provide sufficient capital to best meet firms’ demand for borrowing.

Nguyen Hoang Dung, Deputy General Director in charge of operations at the Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank), said that the bank committed to grant an additional disbursement limit of 5 trillion VND between now and the Lunar New Year 2023 and to reduce the interest rate by 20% for those joining the purchase, consumption and export of key agricultural products in the Mekong Delta.

Pham Duc An, Chairman of Board of Directors at the Vietnam Bank for Agriculture and Rural Development (Agribank), said that from now to the end of the year, the bank’s branches in the region need to disburse 1.6 trillion VND. Agribank has balanced credit targets to ensure it fully meets the credit needs of customers, especially those operating in the field of agriculture and rural areas, An added.

The chairman added that Agribank has always paid attention to the Mekong Delta and identified it as one of the key areas for its lending activities.

In 2022, the bank has set a credit growth target of 11.6% or about 23 trillion VND for the region, higher than the growth rate of its entire system. So far, Agribank has allocated more than 217 trillion VND in credit for the delta, an increase of 10.5% compared to 2021 and accounting for 15% of the bank’s total outstanding loans./.