Official Telegram issued by the Prime Minister of Vietnam on managing credit growth in 2024

Official Telegram issued by the Prime Minister of Vietnam on managing credit growth in 2024 (Internet image) 

On March 5, 2024, the Prime Minister of Vietnam issued Official Telegram 18/CD-TTg on credit growth management in 2024.

Official Telegram issued by the Prime Minister of Vietnam on managing credit growth in 2024 

Specifically, to continue improving the effectiveness of monetary policy tools and implementing decisive measures on interest rate and credit management to support the production and business activities of people and enterprises, promote economic growth, maintain macroeconomic stability, control inflation, and ensure the major balances of the economy, the Prime Minister requires:

(1) The State Bank of Vietnam, in coordination with relevant agencies:

- Urgently review comprehensively the results of credit issuance by the credit system to the economy, by sector, and by field; the results of credit issuance by each credit institution and commercial bank up to the present time, in order to, within their authority and in accordance with the law, have effective, feasible, and timely measures for credit growth and interest rates in 2024, ensuring sufficient credit supply to serve the economy and the safety of the credit institutions' system, absolutely avoiding hindrances, delays, and untimeliness; in case of content beyond their authority, promptly report and propose appropriate authorities according to regulations; take responsibility before the Government and the Prime Minister for the management of monetary policy and credit growth.

- Monitor closely the developments and situation of the global and domestic economy to proactively, flexibly, timely, and effectively manage monetary policy; flexibly and reasonably manage the interest rates and exchange rates in line with the market situation, macroeconomic developments, and the objectives of monetary policy according to the main tasks and solutions stated in Resolution 01/NQ-CP dated January 5, 2024 of the Government, prioritizing promoting economic growth, resolving difficulties for production and business activities, ensuring effective credit growth, meeting foreign currency needs for production and business, and maintaining macroeconomic stability, controlling inflation, and ensuring major balances of the economy, the safe operation of banks and the credit institutions' system, and achieving the credit growth targets set for 2024.

- Implement immediate measures to continue reducing lending interest rates while enhancing access to credit to support the development of production and business activities of people and enterprises, ensure sufficient credit and a healthy foreign currency supply with focus and priority, serve the capital needs of the economy, and ensure the safety of the credit institutions' systems.

- Strengthen and enhance inspections, examinations, controls, and supervision of credit issuance by credit institutions; ensure the flow of credit, including foreign currency credit, concentrated in priority areas, important sectors, and growth drivers of the economy (consumption, export, and investment), and serve the development needs of production and business activities of enterprises and people who have conditions to expand safe, healthy, and sustainable production and business activities but lack capital. Prohibit credit issuance that does not comply with legal regulations, does not target appropriate recipients, and provides preferential interest rates to the leadership, management, and related individuals of credit institutions, ecosystem entities, and shadow businesses, while people and enterprises with legitimate and legal needs face difficulties in accessing credit and foreign currency. At the same time, implement tools to control inflation and minimize and limit the increase of bad debts for credit institutions.

(2) The State Bank of Vietnam directs and requires credit institutions to:

- Align with the directives of the Government and the State Bank of Vietnam, continue to reduce lending interest rates (reduce costs, simplify administrative procedures, enhance the application of information technology, digital transformation, etc.); publicly announce the average lending interest rates to facilitate people and enterprises in accessing credit and choosing banks for borrowing. Actively implement appropriate preferential credit packages according to the characteristics of each credit institution for important areas and growth drivers of the economy in accordance with the Government's direction; promote the pioneering role and exemplary performance of efficient business credit institutions and state credit institutions; and enhance the social responsibility and business ethics of credit institutions in sharing and supporting people and enterprises.

- Continue to direct credit funding to production and business sectors, priority sectors, and traditional growth drivers such as consumption, investment, export, digital transformation, climate change adaptation, green conversion, circular economy, science and technology, and innovation of the economy in accordance with the Government's direction; continue to tightly control credit in high-risk areas; ensure safe and effective credit activities.

- Strengthen information and communication work, guiding customers and beneficiaries in accessing policies. Focus on clear, complete, transparent, and accurate communication of credit institutions' policies, products, services, and foreign exchange to the public.

More details can be found in Official Telegram 18/CD-TTg, dated March 5, 2024.

Ho Quoc Tuan

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