Access to capital is still challenging small and medium enterprises. Photo: ST

Struggling to find capital

Mr. Bui The Duy, CEO of Lua Viet Tourism Co., Ltd., shared: "In the past two years, if it weren't for the bank's credit capital, Lua Viet would probably have 'dead'. However, since the end of June, the disbursement of banks has been very slow even though businesses have high revenue and growth and maintain good reputations with the bank. According to Mr. Duy, the prolonged disbursement time puts businesses at the risk of "missing the rhythm" of their business. To cope with this, businesses must increase cash reserves, causing the cost of capital to increase. Mr. Duy said that as long as the bank shortens the disbursement time, businesses will benefit much.

Speaking at the Forum "Strategies to raise capital of enterprises in new circumstances" just held in Ho Chi Minh City, Lawyer Pham Ngoc Hung, Vice Chairman of Ho Chi Minh City Business Association, said that the main problem of Ho Chi Minh City enterprises today is capital. After the Covid-19 epidemic, many small and medium enterprises have left the market, mainly due to a lack of capital and inability to access capital. The source of capital that small and medium enterprises have long wanted to access is bank capital. Still, most businesses cannot access it because banks require collateral, while small and medium enterprises do not have it.

In addition, most small and medium-sized enterprises are not profitable, so their financial records are not secure, and they cannot borrow credit from banks. Small and medium enterprises also have to make a plan to prove that cash flow can repay the debt, but due to the volatile market, it is difficult for small and medium enterprises to do this. According to Mr. Hung, these criteria were set by the bank before Covid-19, but many small and medium enterprises still find it difficult to meet. "We used to do a program to connect businesses with banks, but only businesses with good health can connect, and those with difficulties in collateral and cash flow are difficult to access credit. ", lawyer Pham Ngoc Hung said.

Regarding the implementation of the 2% interest rate support package under Decree 31/2022/ND-CP and Circular 03/2022/TT-NHNN, a representative of OCB said that from the end of June 2022, OCB had completed documents on regulations, processes and guidelines to implement the support package. Currently, OCB is reviewing the list of existing borrowers and has counted nearly 200 individual and corporate customers with a loan balance of nearly VND 2,600 billion, suitable for subjects participating in the interest rate support program. In addition, OCB will work with customers to provide specific advice and support for businesses.

Need to loosen credit room soon

To lift obstacles such as unsecured conditions and unfeasible business plans after the pandemic, Dr. Can Van Luc, member of the National Financial and Monetary Policy Advisory Council, said that if two things are missing, it is difficult to access credit. Therefore, credit institutions need to ensure business efficiency so as not to lose state and bank capital; even private banks can be criminalized.

Regarding the 2% interest rate support package, Dr. Can Van Luc acknowledged, the current difficulty is how to assess the resilience of enterprises. Therefore, the appraisal and evaluation role of the credit specialist is very important, together with the coordination of relevant ministries such as the Ministry of Construction, the Ministry of Planning and Investment, etc.

Accordingly, Dr. Can Van Luc said that small and medium enterprises should pay attention to the financial leasing segment, which does not need collateral. Vietnam has 11 financial leasing companies and incentives for small and medium enterprises to finance leasing. Besides, it also needs the efforts and goodwill of both parties, including credit institutions and businesses. Because if a credit institution wants to support and provide credit to small and medium-sized enterprises, but the enterprise lacks goodwill and honesty in building a business plan, etc., it will be difficult to access credit.

Regarding the 2% interest rate support package, Dr. Can Van Luc acknowledged, that the current difficulty is how to assess the resilience of enterprises. Therefore, the appraisal and evaluation role of the credit specialist is very important, together with the coordination of relevant ministries such as the Ministry of Construction, the Ministry of Planning and Investment, etc.

Dr. Can Van Luc also suggested that it is not advisable to wait until the fourth quarter, when credit growth and inflation are stable, to the credit room because then it will be too late compared to the recovery needs of the economy and of enterprises. If the room is not loosened immediately, it won't be easy to disburse the interest rate support package. To have good control, it is advisable to adjust the capital flow in the right direction, not to tighten or block it.

The OCB representative also noted that to be supported with the 2% interest rate package, customers must meet the loan conditions, repayment ability, resilience, etc. Therefore, businesses need to set up clear business plans. Then, if the business project is effective, and the loan is used for the right purpose, the bank can quickly approve it.