Ministry readies SME development fund
Ministry readies SME development fund
The Ministry of Planning and Investment recently worked with commercial banks to study their capacity of lending to small and medium-d enterprises (SMEs).
The study was done because the ministry aims to put the SME development fund into operation at the end of this year or latest by the beginning of next year as its personnel system, budget and operation rules are being set up.
Careful preparations are needed to ensure that the fund, which has received capital from the State budget, supports SMEs efficiently, according to the Department of Corporate Development.
According to To Hoai Nam, deputy president of the Associations of Small and Medium Enterprises, SMEs are facing difficulties as their competitiveness and capital sources remain limited. The fund would help SMEs get preferential loans from banks.
The Prime Minister issued Decision 601/QD-TTg about the establishment of the fund on April 17, aimed at enhancing SMEs' competitiveness, creating more jobs and raising incomes.
In the first three years, the fund would receive VND2 trillion (US$95 million) from the State budget, then VND500 billion ($23.5 million) each year in the next two years and another VND1 trillion ($4.75 million) in the following year.
The fund would entrust the Viet Nam Development Bank and other commercial banks with loans for SMEs that meet the fund's loan eligibility terms.
The maximum loan for each project would not exceed 70 per cent of the project's total investment and would not exceed VND30 billion ($1.4 million). The loan must be repaid within seven years.
There are more than 500,000 SMEs in the country, accounting for 97.5 per cent of the existing companies.
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