Loan sharking with sky-high interest rates is causing negative impacts on Vietnam’s banking operation and renders people into poverty, thus a better loan access provided by the banking sector would be key to tackle the issue, according to Prime Minister Nguyen Xuan Phuc.
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Under this circumstance, Phuc requested the banking sector to cooperate with the Ministry of Public Security in preventing the spreading of black credit, while supporting people to access loans.
Phuc also informed that the State Bank of Vietnam (SBV) has provided a US$215.45- million credit package for Vietnam Bank for Social Policies and Vietnam Bank for Agriculture and Rural Development in dealing with the issue.
According to Phuc, the SBV along with credit institutions would play a vital role for Vietnam to achieve socio-economic objectives in 2019, in long-term transforming Vietnam from a low-middle income country to a high-income country.
Additionally, the PM expected the SBV to continue managing the monetary in a flexible and cautious manner, at the same time bolstering the economic resilience against external shocks.
Phuc requested significant improvements in the corporate governance of the banking system, as most banks should be able to meet the requirements on capital adequacy ratio (CAR) following Basel II standards, scheduled for implementation on January 1, 2020.
