Agribank is the main provider of low-interest loans.

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

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

Credit institutions are providing loans for the 1 million hectare high-quality rice project using their own mobilized capital.

Accordingly, regarding the implementation phases, the lending program will be implemented in two phases (based on the two implementation phases of the Project as per Decision 1490), in which the pilot phase from now until the end of 2025 will be led by Agribank as the main lending bank, and the expansion phase will run from the end of the pilot phase until 2030 at other credit institutions.

Credit institutions provide loans using their own mobilized capital. Therefore, lending is conducted under a commercial mechanism with lending conditions in accordance with the credit institution's current regulations for customers.

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

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

Regarding disbursement capacity, the State Bank of Vietnam stated 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 rice production in rice linkages, nor have they identified and announced specialized farming areas, linkages, and participating entities. Therefore, credit institutions do not have a basis to assess the capital needs for serving the linkage chains under the Project.

However, in principle, the disbursement rate depends on the actual capital absorption capacity of the entities participating in the linkage.

In addition to the aforementioned minimum interest rate reduction of 1%, entities participating in rice production linkages also enjoy many other incentives as stipulated in Government Decree 55 dated June 9, 2015, and Government Decree 116 dated September 7, 2018, on credit policies serving agricultural and rural development, such as:

The maximum unsecured loan amount ranges from VND 100 million to VND 3 billion (depending on the customer type: individual, cooperative, or collective organization).

The lending policy encourages agricultural production based on integrated models and high-tech agriculture, with unsecured loans of up to 70%-80% of the project value.

Restructuring loan repayment terms while maintaining the same loan classification for customers facing difficulties due to objective reasons or force majeure.

The policy encourages people to purchase agricultural insurance by reducing loan interest rates by at least 0.2% per year compared to the interest rates of similar loans with the same term.

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