Just 3 loans from SME fund so far

Viet Nam News

HÀ NỘI — Though the Small and Medium Enterprise (SME) Development Fund was established a year ago, so far only three firms have got loans from it, fund director Hoàng Thị Hồng said.

The SME fund has a registered capital of VNĐ2 trillion (US$88.8 million).

The three companies received loans worth VNĐ15 billion are involved in innovation and the manufacturing industry.

Since its establishment,1,000 enterprises have been advised of its borrowing procedures, and 20 applied for loans worth a total of VNĐ250 billion, according to Hồng. However, after the appraisal process, the fund offered loans to only three enterprises.

The result is exceptional considering the fund’s target and its preferential policies.

The fund is expected to provide loans worth VNĐ560 billion by 2017.

As a rule, the fund will provide businesses with a maximum of 70 per cent of a project’s capital at an interest rate of 5 per cent per year for one-year loans and 7 per cent per year for medium- and long-term loans. The maximum loan period is seven years.

One of the advantages of the fund, compared to bank loans, is that to borrow money, businesses can use assets formed from loans [output of their projects] as collateral. Also, usually, bank requires SMEs to mortgage assets whose value is 100 to 150 per cent of

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