SMEs still cramped by insufficient credit: survey
SMEs still cramped by insufficient credit: survey
A survey reaffirms that 62 percent of small and medium enterprises in Vietnam struggle to access capital to build factories and install equipment.Respondents in a survey of 60 Vietnamese SMEs by market research firm InsightAsia say that capital is vital in the initial period of establishing their business, but they have trouble acquiring it from banks and from government support programs.
Survey results released Thursday showed that 90 percent of SMEs want to rent factory space for at least three years for stable production, but because of the lack of capital, they tend to use their own homes as factories, which increase their costs as they have to install water discharge systems, not to mention cause trouble with neighbors because of noise and chemical smells.Capital shortage is why SMEs have continued to account for 97 percent of Vietnamese businesses for years. Many companies continue to remain micro businesses, unable to expand, said InsightAsia research director Tran Thi Lien Phuong.
Another challenge SMEs face is finding a stable customer base, according to 60 percent of the respondents. Other challenges are finding space to set up workshops and several legal issues.
The survey results come at a time Vietnam has been seeing a booming startup scene with increasing numbers of people wanting to start their own business.
Another survey result released by the World Economic Forum in October found 25.7 percent of Vietnamese want to work for themselves, a ratio lower than only Indonesia and Thailand in ASEAN.
