Further reform urged in banking sector to support business

10:47 | 23/07/2019 Finance - Banking

(VEN) - Administrative reform has always been a focus of the State Bank of Vietnam (SBV) and is considered the key factor in improving the efficiency and quality of the central bank’s management and the banking sector’s tasks.

further reform urged in banking sector to support business

The central bank’s reforms were discussed at an online conference in Hanoi on June 17 on promoting administrative reform in the banking sector, improving the business environment, and improving the credit access index.

The goal of administrative reform in the banking sector is to support businesses and people in accessing financial-banking information and services, improving the national business environment.

In the past four years, the SBV has led 19 ministries and agencies in the Public Administration Reform (PAR) index. In addition, Vietnam’s index on access to credit in 2018 also ranked 29 among the 190 economies surveyed, according to the World Bank’s Doing Business 2018 report.

During the 2014-2018 period, through the bank-business connection program, credit institutions committed to providing businesses with loans totaling more than VND2,500 trillion at preferential interest rates. In addition, more than 1,500 dialogues between banks and businesses were organized across the country.

In 2018, as many as credit institutions lowered lending interest rates to support businesses and offered nearly 100 credit programs and soft loans, including 15 for small- and medium-sized enterprises and startups. They also decreased a number of fees and upgraded their technological systems to meet firms’ e-commerce demand.

Speaking at the conference, SBV Deputy Governor Dao Minh Tu said promoting administrative reform and reducing service fees and interest rates have become strategic factors for any credit institution.

Although there have been positive results, the banking sector still has lots of work to do, such as continuing to implement dialogue between banks and businesses, and eliminating barriers to help businesses and people easily access financial-banking information and services.

Nguyen Tri Hieu, a financial expert, said small- and medium-sized enterprises still face difficulties in accessing bank loans because they lack collateral. Therefore, commercial banks should consider new policies to increase the limits of unsecured loans, while setting up specialized appraisal departments to accelerate disbursement.

Huynh Anh Tuan, deputy director of the Everest Securities Joint Stock Company, said that in addition to a focus on shortening the time of administrative procedures, banks should also promote communication and financial education to raise public awareness and encourage people to use financial and banking services safely and effectively.

Ngoc Thao