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On March 21, Saigon-Hanoi Commercial Joint Stock Bank ( SHB ) cooperated with IFC to enhance financial access for SMEs.
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Accordingly, IFC will provide a loan worth USD 40 million - the first tranche of a total expected loan package of USD 120 million, to help SHB support more domestic enterprises and promote their participation in global supply chains. IFC's investment is expected to help SHB double the number of loans for SMEs and women-owned businesses by 2025.
According to IFC, in Vietnam, although SMEs play an important role in the economy , generating 40% of the gross domestic product (GDP) and 50% of employment, these businesses still face many difficulties in accessing finance, with about 62% of the total capital needs of SMEs unmet. An IFC survey in 2017 estimated the capital needs of SMEs in Vietnam at about 21.7 billion USD.
SHB said that with preferential capital from IFC, Vietnamese SMEs have access to credit capital from banks, thereby expanding production and business activities, aiming for sustainable development.
Notably, about one-fifth of the loan package will be allocated to SMEs participating in the supply chain. This funding, together with IFC’s advisory activities, will help SHB expand the scale of value chain finance – a new segment in the Vietnamese market, providing more effective financial solutions at lower costs for suppliers participating in supply chains.
Mr. Thomas Jacobs, IFC Country Manager for Vietnam, Cambodia and Laos, also said that IFC is coordinating with international lending institutions to mobilize an additional financing package to further enhance SHB's SME lending capacity.
IFC’s Global Trade Finance Program (GTFP) is expected to provide a trade guarantee line worth USD 75 million to SHB in the near future. IFC will also advise SHB to improve its environmental, social and governance (ESG) standards and strengthen its risk management capacity.
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