Economists discuss ways to help SMEs
Deposit rate cap to be lowered to 9pct
Apart from numerous difficulties caused by high inflation and interest rates in 2011, most businesses found it difficult to access preferential loans.
Although the Government already launched bailout packages and offered low-interest loans to help them iron out their snags, many small-and-medium-sized enterprises (SMEs) have failed to benefit from such incentive policies.
Tran Hong Phuc, Deputy Director of Phuc Hung Construction JSC, says banks are still hesitant to grant them loans for further investment. It is no easy task to mobilize bonds or borrow loans from credit organizations, he adds.
The main reason is most SMEs do not have enough assets to make a deposit when their bad debts are growing.
Another reason, cited by Pham Thien Long, a senior official from HDbank, is that they can hardly meet basic requirements from the banks, let alone pay back their loans.
According to Long, both banks and businesses encounter difficulties following the State Bank of Vietnam (SBV)’s recent decision to lower interest rates by 2 percent. With domestic businesses facing a decline in the purchasing power and other risks, banks have good reason to stop lending.
Economist Le Dang Doanh says that it is essential to deal with bad debts to consolidate their trust in business performance. He proposes establishing a credit guarantee fund to settle bad debts and remove obstacles to both banks and businesses.
The SBV has reduced deposit interest rates by 2 percent from 11 to 9 percent per year to cut loan rates and help businesses to boost production. Nguyen Thi Hong, Head of the SBV’s Department for Monetary Policy, says the central bank will stabilize interest rates from now to the end of this year.
In the current situation, businesses should grasp every opportunity by way of restructuring their operations and production chains in line with market fluctuations, instead of depending too much on banks.
However, not a few businesses are still waiting for the State’s intervention in the bank restructuring process.