06:00 | 09/02/2021 Economy
(VEN) - The State Bank of Vietnam’s (SBV) monetary policy was on the right track in 2020 with the goal of supporting businesses to overcome difficulties, contributing to promoting growth and ensuring sustainable economic development.
The SBV managed monetary growth in 2020 in accordance with the absorption level of the economy and with a focus on trade and production activities, consumption and priority sectors under the government’s guidelines. Its policy and decisions thus made a significant contribution to the country’s post-pandemic economic recovery.
In 2020, the SBV adjusted annual interest rates three times, for a total reduction of 1.5-2 percent. The lending rate as of the end of November was brought down by one percent per annum on average compared to the end of 2019.
Credit institutions restructured repayment terms for about 270,000 customers affected by the pandemic, with the value of outstanding loans moving close to VND355 trillion. Interest rate exemptions and reductions were applied for nearly 590,000 customers, with outstanding loans exceeding VND1,000 trillion.
Nguyen Tuan Anh, director of the SBV’s Credit Department, said the government’s overall solutions and the banking sector’s effective measures made a significant contribution to the country’s credit growth in 2020. While credit growth only reached 1.31 percent in the first quarter, it gradually increased to 3.65 percent in the second quarter, 6.08 percent in the third quarter, and 10.14 percent as of December 21. According to SBV estimates, credit grew by about 11 percent in 2020, mainly pouring into trade and production activities and priority sectors.
Pham Tien Dung, director of the SBV’s Payment Department, said non-cash payments continued to see strong growth in 2020. By the end of October 2020, the number of payment transactions via mobile phones surpassed 918.8 million worth nearly VND9,600 trillion in total, an increase of 123.9 percent in number and 125.4 percent in value compared to the same period in 2019. Nearly 374 million transactions worth more than VND22,200 trillion were done through the internet, a year-on-year increase of 8.3 percent in number and 25.5 percent in value.
In 2021, the SBV will manage monetary policy in a proactive, flexible and cautious manner, and in harmony with fiscal and other macroeconomic policies to curb inflation, maintain macroeconomic stability and fuel economic growth. In particular, the SBV targets a credit growth rate of 12 percent in 2021, but the central bank may adjust it if necessary.
|SBV Deputy Governor Dao Minh Tu said the banking sector will continue to cut costs in order to reduce lending interest rates, simplify procedures and create favorable conditions for new borrowers to recover their trade and production activities. In addition, credit will be extended, focusing on loans for trade and production activities and priority sectors, and will be controlled strictly for risky areas.|