Nearly 70 percent of 2,600 surveyed small-and-medium sized enterprises (SMEs) have to seek loans on the black market as they were unable to access bank loans. (Photo: VPBank) Hanoi (VNA) - Nearly 70 percentof 2,600 surveyed small-and-medium sized enterprises (SMEs) had to seek loanson the black market as they were unable to access bank loans.
The businesses’ ability to access loans fell from 45 percent in2011-13 to 24 percent in 2015. The loans granted to the remaining 30 percentaccounted for only 3 percent of total bank capital in the market.
The survey which was conducted by the Central Institute forEconomic Management (CIEM) in co-operation with Copenhagen University and theInstitute of Labour and Social Affairs at the end of last year was released atthe Enterprise Connecting Day held in Hanoi last weekend.
Dau Anh Tuan, Head of the Legal Department under the VietnamChamber of Commerce and Industry (VCCI) said its annual report showed that lastyear a record 110,100 businesses were established, representing a 16 percentyear-on-year increase. The total registered capital of the firms hit 891.1trillion VND or 48 percent higher than the previous year. 2016 also saw 26,689companies resuming operations, up 24 percent from the previous year.
However, the report also said that the rate of businesses facingdifficulties in accessing bank loans was 44 percent. The interest rate for bigfirms was 7 percent a year while that for SMEs was more than 8 percent.
The report shows that SMEs faced difficulties in accessing bankloans and were charged higher interest rates, Tuan said.
He added that 87 percent of businesses have had difficulties inmortgage assets, 66 percent complained about high interest rate and lendingconditions while 51 percent believed that lending procedures were complicated.
“In addition to difficulties in accessing bank loans, SMEs havefaced troubles in seeking customers, suitable human resources and cumbersomeadministrative procedures,” said Pham Hoang Tien, director of VCCI’s SMEsPromotion Centre.
Hoang Xuan Hai, director of VAG International Joint Stock Company whichspecialises in producing and exporting towels said many banks took meetingswith him to discuss his company. However, they refused his loan applications ashis company did not have assets for mortgage.
Sharing the ideas, Bui Thi Hong Ha from CPART Company, whichdevelops microbiological lines for environmental protection, husbandry andcultivation said their products have big potential, especially for exports toLaos.
However, they have had difficulties in accessing bank loans, withthe cumbersome procedures requiring several meetings.
Dao Gia Hung, deputy director of the Vietnam Prosperity Bank(VPBank)’s SMEs Division, said there are problems in the market that keep banksand businesses apart.
“However, VPBank has provided support to remove capital barriersfor the development of SMEs,” Hung said, adding that the bank has offered manycredit products for SMEs and micro firms.
VPBank does not require complicated administrative procedures anduses experienced bank staffers to inspect businesses’ operations to grant loansquickly.
He added that providing loans to enterprises meant risks inpayment. VPBank therefore has always paid attention to improving its riskmanagement. It has built infrastructure to control risks, with staff membersconsulting businesses after loans are approved.
“Over the past few years, risks relating to the bank’s loans toSMEs have been under control,” he said.
Le Dang Doanh added that SMEs should get more involved in valuechains and deepen international integration.-VNA
The businesses’ ability to access loans fell from 45 percent in2011-13 to 24 percent in 2015. The loans granted to the remaining 30 percentaccounted for only 3 percent of total bank capital in the market.
The survey which was conducted by the Central Institute forEconomic Management (CIEM) in co-operation with Copenhagen University and theInstitute of Labour and Social Affairs at the end of last year was released atthe Enterprise Connecting Day held in Hanoi last weekend.
Dau Anh Tuan, Head of the Legal Department under the VietnamChamber of Commerce and Industry (VCCI) said its annual report showed that lastyear a record 110,100 businesses were established, representing a 16 percentyear-on-year increase. The total registered capital of the firms hit 891.1trillion VND or 48 percent higher than the previous year. 2016 also saw 26,689companies resuming operations, up 24 percent from the previous year.
However, the report also said that the rate of businesses facingdifficulties in accessing bank loans was 44 percent. The interest rate for bigfirms was 7 percent a year while that for SMEs was more than 8 percent.
The report shows that SMEs faced difficulties in accessing bankloans and were charged higher interest rates, Tuan said.
He added that 87 percent of businesses have had difficulties inmortgage assets, 66 percent complained about high interest rate and lendingconditions while 51 percent believed that lending procedures were complicated.
“In addition to difficulties in accessing bank loans, SMEs havefaced troubles in seeking customers, suitable human resources and cumbersomeadministrative procedures,” said Pham Hoang Tien, director of VCCI’s SMEsPromotion Centre.
Hoang Xuan Hai, director of VAG International Joint Stock Company whichspecialises in producing and exporting towels said many banks took meetingswith him to discuss his company. However, they refused his loan applications ashis company did not have assets for mortgage.
Sharing the ideas, Bui Thi Hong Ha from CPART Company, whichdevelops microbiological lines for environmental protection, husbandry andcultivation said their products have big potential, especially for exports toLaos.
However, they have had difficulties in accessing bank loans, withthe cumbersome procedures requiring several meetings.
Dao Gia Hung, deputy director of the Vietnam Prosperity Bank(VPBank)’s SMEs Division, said there are problems in the market that keep banksand businesses apart.
“However, VPBank has provided support to remove capital barriersfor the development of SMEs,” Hung said, adding that the bank has offered manycredit products for SMEs and micro firms.
VPBank does not require complicated administrative procedures anduses experienced bank staffers to inspect businesses’ operations to grant loansquickly.
He added that providing loans to enterprises meant risks inpayment. VPBank therefore has always paid attention to improving its riskmanagement. It has built infrastructure to control risks, with staff membersconsulting businesses after loans are approved.
“Over the past few years, risks relating to the bank’s loans toSMEs have been under control,” he said.
Le Dang Doanh added that SMEs should get more involved in valuechains and deepen international integration.-VNA
VNA
