Agribank is the main provider of low-interest credit.

According to information recently announced by the State Bank of Vietnam (SBV), the SBV has coordinated with relevant ministries, branches and localities to develop a loan program linking production, processing and consumption of high-quality and low-emission rice products in the Mekong Delta (MD) according to Decision No. 1490 dated November 27, 2023 of the Prime Minister approving the Project "Sustainable development of one million hectares of high-quality and low-emission rice cultivation associated with green growth in the MD by 2030".

On October 11, the State Bank of Vietnam issued Document No. 8363 to the People's Committees of provinces and cities in the Mekong Delta region; Document No. 8364 to credit institutions, foreign bank branches, and State Bank branches in provinces and cities in the Mekong Delta region, providing guidance on some contents for organizing and implementing the Program.

Credit institutions implement loans for the project of 1 million hectares of high-quality rice using self-mobilized capital.

Accordingly, regarding the implementation phases, the lending program will be in 2 phases (based on the 2 phases of the Project implementation according to Decision 1490), in which the pilot phase from now until the end of 2025 will be with Agribank as the main lending bank and the expansion phase from the end of the pilot to 2030 at credit institutions.

Credit institutions make loans using self-mobilized capital. Therefore, lending is carried out according to commercial mechanisms with lending conditions according to current regulations of credit institutions for customers.

The purpose of the loan is to meet short, medium and long-term capital needs of all stages (production, purchasing, processing and consumption) in the rice linkage.

Regarding lending interest rates, credit institutions proactively balance capital sources and reduce costs to consider applying lending interest rates at least 1%/year lower than the lending interest rate of the corresponding term currently applied to customers of the same term/same group.

Regarding disbursement capacity, the State Bank said that currently, the Ministry of Agriculture and Rural Development and the People's Committees of provinces and cities have not yet announced the actual cost norms for implementing rice production in rice linkages and have not yet determined and announced specialized areas, linkages and entities participating in the linkages, so credit institutions have no basis to assess the capital needs to serve the linkage chains according to the Project.

However, in principle, the ability to disburse depends on the actual capital absorption capacity of the participating entities.

In addition to the above-mentioned preferential interest rate reduction of 1%, entities participating in rice linkage also enjoy many other incentives according to the provisions of Decree 55 dated June 9, 2015, Decree 116 dated September 7, 2018 of the Government on credit policy for agricultural and rural development such as:

The maximum unsecured loan amount is from 100 million VND to 3 billion VND (depending on the individual customer, cooperative group, or cooperative);

Loan policy to encourage agricultural production according to the linkage model, high-tech agriculture with unsecured loans up to 70%-80% of the value of the plan or project.

Restructuring debt repayment terms and maintaining debt groups for customers facing difficulties due to objective and force majeure reasons.

The policy encourages people to buy agricultural insurance by reducing loan interest rates by at least 0.2% per year compared to interest rates of loans of the same type and with corresponding terms.

Source: https://www.nguoiduatin.vn/de-an-1-trieu-ha-lua-chat-luong-cao-agribank-chu-luc-cap-tin-dung-lai-suat-thap-204241015182820776.htm