HCMC – The biggest concern raised by almost all enterprises at a seminar on capital for small and medium enterprises (SME) last week is difficult access to loans at commercial banks but the situation is expected to improve in the near future.
A business executive said at the seminar that commercial banks should keep their promises. He had joined a lot of similar seminars where banks promised to support SMEs, but after that he got disappointed when no bank approved his borrowing application, he said.
Nguyen Xuan Lam, director of L.V. Company, which produces auto parts, said his SME falls under the category of having priority access to bank loans in line with Government policy as his enterprise exports all output and operates in the hi-tech industry. However, no bank has lent to his business, causing its loss of contracts, he noted.
“In the past big foreign customers expressed interest in placing orders with us but we could not secure them because our facilities do not meet their requirements,” Lam said. His enterprise is borrowing capital from ACB, he said, and it needs long-term capital to build a factory.
The two are among the many businesses that have found it impossible to take out bank loans due to high interest rates and hindrances along the way.
Do Lam Dien, deputy head of corporate clients at Maritime Bank, said there existed many obstacles to SMEs’ access to bank loans, such as lack of mortgages, banks’ unwillingness to lend to SMEs, problematic tax payment reports, unsound business plans, and high lending rates.
However, the situation is seen changing for the better in the coming time. Commercial banks, seeking to boost lending, have begun to see SMEs as a potential market, and mapped out plans to tap those corporate customers.
Banks, including foreign ones, have set up a department in charge of SMEs, and most of them said SMEs are their potential clients.
Many programs targeting this segment have come out. For example, An Binh Bank has combined with IFC to support SMEs, and HDBank has earmarked VND2 trillion for financing enterprises in the coffee sector.
Nguyen Dinh Tung, deputy general director of Maritime Bank, said the bank had gauged demand of local SMEs over the past two years to work out a qualitative model to assess corporate clients, instead of the quantitative model that used to be applied.
“We will learn about SMEs as clients by accessing and interviewing them,” Tung said at the seminar.
According to the HCMC Institute for Development Studies, Vietnam now has 500,000 enterprises of which SMEs account for 97%. SMEs are responsible for about 30% of GDP, 30% of industrial output value, nearly 80% of total retail sales, and 64% of total goods transport volume every year.
Most small and medium enterprises in Vietnam are unable to access bank loans because of their inability to present comprehensive financial documents, heard a report at a conference Thursday.