Financial institutions accelerate loan issuance in anticipation of the heightened loan requirements towards year's end
In the vibrant business landscape of Vietnam, many companies have embarked on large-scale projects, signalling a positive outlook and ensuring sustained credit demand. Amidst this growth, one bank, in particular, has taken a leading role in supporting businesses, especially small and medium-sized enterprises (SMEs).
The Asia Commercial Bank (ACB) is leveraging its extensive ecosystem of 8 million retail customers and 300,000 corporate clients to help businesses expand their market reach. Recognising the unique challenges that SMEs face in accessing funding, ACB has shifted its lending philosophy from a collateral-based approach to one focused on cash flow and operational capacity.
ACB offers cash flow-based loans of up to $400,000, overdrafts up to $120,000, and long-term instalment loans with repayment periods of up to 15 years, all without requiring collateral. This innovative approach is designed to help SMEs access funding despite typical lending challenges.
In a significant move, ACB has launched a $1.6 billion credit package with interest rates lower than the market average. This package is aimed at providing much-needed support to SMEs, a sector that often struggles to secure unsecured loans or benefit from preferential lending programs, with only about 30% of SMEs currently obtaining such benefits.
The banking sector continues to play a crucial role in the corporate bond market, helping to replenish capital sources and support growth. ACB's efforts are not isolated, as other major banks such as Vietcombank, Military Bank (MB), VPBank, and HDBank are projected to enhance their SME lending capacity due to regulatory support like halving the required reserve ratio starting October 2025.
Tech-savvy banks like Techcombank and TPBank also lead in AI-driven lending and fintech partnerships, further stimulating growth in the SME credit market. The Vietnamese government's updated SME development fund policies further encourage tailored lending products for SMEs from 2025 onwards.
However, despite the recovery of credit demand, banks still face challenges related to rising bad debts, provisions, and deposit interest rates. This is a concern that persists despite many Vietnamese startups undergoing rigorous due diligence by investment funds before receiving capital injections, which helps banks reduce their own lending risks.
Looking ahead, credit flows are expected to concentrate in the production and business sectors, as well as renewable energy projects. As Vietnam's credit growth in the first half of 2025 reached nearly 10% across the banking system, driven by accelerated public investment and a recovering real estate market, the future looks promising for businesses seeking funding and growth opportunities.
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