From a policy standpoint, the State Bank of Vietnam has established and is perfecting the legal framework for the development of green credit and green banking, with notable initiatives including the approval of the Green Banking Development Project in Vietnam and the issuance of the Banking Sector Action Plan to implement the Strategy for the Development of the Vietnamese Banking Industry by 2025, with a vision to 2030.

The goal is to promote green credit development and green banking to help the economy transition to green growth, low carbon emissions, climate adaptation, and increased bank credit capital investment in renewable energy, clean energy, low-carbon industries, and environmentally friendly consumption.

These legal underpinnings and conditions are required for financial institutions to expand and create green credit. At the local level in Ho Chi Minh City, the city's banking industry is concentrating on efficiently implementing three primary solutions:

First, the SBV's green credit development policies are being implemented through specific action programs linked to the implementation of government credit programs, SBV credit programs, and the city's People's Committee credit programs, with a focus on achieving specific targets for green credit growth tied to green economic growth in the city. Based on SBV regulations and applicable legal provisions, credit institutions continue to develop and improve internal regulations for environmental and social risk management in credit approval processes, integrating these aspects into green credit approval procedures, and developing and expanding green credit products to support the city's green economic development.

Second, leveraging and deploying safe capital efficiently to satisfy the capital demands of green economic growth. Large capital and medium to long-term investments in technological innovation, renewable energy, clean energy, and green technologies across many economic sectors are often required for green initiatives. As a result, Mr. Leng believes that credit institutions should use capital efficiently and correctly in terms of term structure, interest rates, and financing sources to ensure effective safety in developing and increasing green credit. Furthermore, it is critical to increase and optimize the use of foreign financial institution loans in green economic development programs, environmental protection, and carbon credit markets.

Third, enhancing communication and information transmission is critical, particularly in the early phases of green credit growth. Mr. Leng underlines the need of informing bank personnel on a regular and ongoing basis about their roles in implementing green credit development solutions and offering information and advice to consumers. This solution should be applied regularly and in conjunction with particular activities. Initially, the emphasis should be on the impression and simplicity of building and developing green banks in the narrow sense of the "green bank" model, with practical actions such as improving the working environment with greenery and energy-efficient equipment, as well as individual bank employee actions on these issues.

According to KPMG, Vietnam would require around $368 billion in investment between now and 2040 to attain the Net Zero objective by 2050. Renewable energy, green infrastructure, electric mobility, agricultural and food supply networks, heavy industry, and supply chains are among the six industries predicted to profit from this investment.

According to the World Bank's 2022 National Climate and Development Report for Vietnam, 100 million Vietnamese people, among the world's most vulnerable, face various climate threats along the country's 3,260-kilometer coastline and huge low-lying areas. The threats to metropolitan regions and industrial zones, particularly in and around Ho Chi Minh City, constitute a serious economic threat. Climate-related impacts caused roughly $10 billion in damage to Vietnam in 2020, equivalent to 3.2% of GDP. According to models, the overall economic consequences of climate change may reach $523 billion by 2050. The paper advocates for priority investment to combat the effects of climate change.

The report also recommends that "Vietnam must allocate significant resources to protect Ho Chi Minh City – the country's largest urban area and the low-lying coastal area, as well as the Mekong Delta region – from the impacts of climate change." In other words, the Ho Chi Minh City area urgently requires increased flow of green credit.

According to current data in the banking industry, the total outstanding green credit is 528 trillion VND (5% of overall credit in the economy). Green credit is growing at a positive rate of around 26% per year on average, but in order to attain Net Zero by 2050, capital and investment through the credit channel will be essential. As a result, this growth rate may fall short of the target. There are now 43 financial institutions participating in green credit.

The SBV aims to have 100% of credit institutions participating in green credit activities by 2025. Among these, banks must have internal guidelines and regulations for assessing environmental and social risks in accordance with regulations. The proportion of green credit in the economy is expected to reach 10% by the end of 2025.