Vietnam banks implement interest rate cuts to support businesses

Following directives from the State Bank of Vietnam (SBV), commercial banks are actively reducing interest rates to lower capital costs for production and business activities. The SBV has instructed banks to implement substantive reductions in both deposit and lending rates, aiming for a decrease of 1.5% to 2% for priority sectors.

Agribank's Ha Tinh II branch has already adjusted rates for over 12,000 loans, with some reductions reaching up to 2.5% per year. Similarly, VPBank has launched programs to reduce lending rates by 1.5% for specific industries, including agriculture, tourism, and manufacturing, as well as for small and medium enterprises (SMEs). Sacombank is also deploying a 20,000 billion VND credit package to support individual customers with rate cuts of 1.5% to 2%.

Despite these efforts, some businesses report that lending rates exceeding 10% per year significantly erode profit margins, particularly for those with low margins and long project cycles. Industry representatives have called for more practical rate reductions and easier access to credit, noting that high interest rates and collateral issues remain major hurdles for economic growth.