Commercial banks are providing approximately 88% of total green credit outstanding in Vietnam. (Photo: nhandan.vn)

Outstanding green credit in the banking system has risen sharply, reflecting growing interest from both banks and businesses in low-emission and sustainable development initiatives.

According to the State Bank of Vietnam (SBV), by the end of November 2025, outstanding green credit was estimated at around 750 trillion VND (28.55 billion USD), with an average growth rate exceeding that of overall credit in the economy.

Green credit has made encouraging progress, focusing on renewable energy, high-tech agriculture, the circular economy, waste treatment and energy efficiency. Commercial banks currently account for about 88% of total outstanding green credit. Green funding is mainly mobilised through green bond issuance and international loans. Between 2020 and 2025, Vietnam issued more than 1.5 billion USD worth of green bonds.

However, the scale of green capital remains modest relative to the economy’s transition needs, while the legal framework is still being refined.

Pham Thi Thanh Tung, Deputy Director of the SBV’s Credit Department for Economic Sectors, noted that although green credit has grown at an average rate of over 21% per year since 2017, it still accounts for only about 5% of total outstanding credit, which stands at roughly 18.2 quadrillion VND.

A key limitation is the economy’s heavy reliance on bank credit, while green projects typically involve long payback periods, high upfront costs and elevated risks. In this context, banks—especially State-owned commercial lenders play a critical guiding role.

Deputy Head of Credit Policy Department at Agribank Vuong Van Quy said that Agribank has prioritised green lending, ESG integration and sustainable governance, with green credit outstanding reaching 28.36 trillion VND by the third quarter of 2025, serving nearly 40,000 clients. Its green credit portfolio focuses on renewable energy, sustainable forestry and green agriculture.

The Politburo's Resolution No. 68-NQ/TW dated May 4, 2025 on the development of the private sector and Resolution No. 198/2025/QH15 of the National Assembly have identified the policy of providing interest rate support for green projects. The SBV, in coordination with the Ministry of Finance, is finalising a decree on 2% interest rate subsidies for green and circular economy projects, slated for early 2026. Meanwhile, the green corporate bond market and proposals such as a green credit guarantee fund and a carbon credit trading platform are seen as key tools to support sustainable finance.

Ultimately, sustainable growth begins with concrete investment decisions. The real challenge is not how much capital is mobilised, but whether it helps transform production models, cut emissions and improve the quality of growth as Vietnam restructures its development path.