After declining in the first two months of this year, credit of the banking industry in March increased by 0.26% compared to the end of 2023 to about 13.6 quadrillion VND, the State Bank of Vietnam (SBV) reported.
Hanoi (VNS/VNA) - After declining in the first two months of thisyear, credit of the banking industry in March increased by 0.26% compared tothe end of 2023 to about 13.6 quadrillion VND, the State Bank of Vietnam (SBV)reported.
According to the SBV, the credit of the banking system in the first two monthsthis year decreased by 0.72% compared to the end of last year. Low creditgrowth in the first months of a year is common. The average credit growth inthe first two months in the 2013-23 period was 0.56%. Credit declines in thefirst two months were also seen, in 2014, 2018 and 2024.
However, experts say the credit decrease in the first two months of 2024 wasmore serious because this year's conditions are different from the previousyears, as the SBV this year assigned the entire credit growth quota of 15% forcommercial banks right in the first month instead of only allocating a part ofthe quota at the beginning of the year as previously.
Therefore, the SBV in February had to send an official dispatch to creditinstitutions stating that despite the application of supporting policies toboost credit from the beginning of the year, credit growth this year was stillquite low compared to recent years.
To boost credit growth, the SBV has requested credit institutions to firmlyimplement effective credit growth solutions since early February. Accordingly,credit institutions must review to simplify lending procedures with an aim toincrease people's ability to access capital.
Besides, they must focus on strengthening digital transformation in the creditprocess to increase access to capital and more widely popularise banking creditactivities.
In addition, the SBV said it was necessary to improve the operationalefficiency of funds such as the credit insurance fund for small- andmedium-sized enterprises (SMEs), and the development fund for SMEs, to enhanceSMEs' ability to access credit.
The SBV also noted credit must focus on production, business and theGovernment’s priority sectors, as those are the country’s economic growthdrivers. Banks also need to strictly control credit for potentially riskysectors to ensure safe and effective operations.
On the borrower side, the SBV has also encouraged enterprises to activelyimplement solutions to restructure operations; have more feasible investment,production and business projects; prove the feasibility of the projects; andstrengthen transparency and financial capacity so that credit institutions canappraise and provide loan services to borrowers conveniently in the comingtime./.
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Illustrative image (Photo: VNA) 
