Loans without collateral in agriculture: Removing obstacles, improving policy effectiveness

BAC NINH - In order to promote the development of the agricultural and rural areas, the Government has issued many specific regulations, expanding the lending mechanism without collateral. The maximum loan amount under this form is currently up to 5 billion VND, with quick procedures to help people, business households and cooperatives access capital in a timely manner to invest in production and business.

Streamlined procedures, paving the way for production

In early September, Mr. Hoang Van Hung, Dong No village, Lang Giang commune, sold 10 buffaloes for meat, earning more than 200 million VND; after deducting expenses, he made a profit of 20 million VND. In his barn, there are still more than 10 large and small buffaloes. It is known that in November 2024, Mr. Hung's family received a loan of 200 million VND from the Bank for Agriculture and Rural Development (Agribank), Lang Giang - Bac Giang II Branch, to repair the barn and buy more buffaloes for meat. "Thanks to the quick procedures, I got the loan in just one day. Working as a buffalo driver, I need quick capital turnover, if I wait for mortgage, I will miss the opportunity. Now with convenient loans, I can maintain a herd of 10-15 buffaloes, with a much more stable income," Mr. Hung said. Previously, Mr. Hung used to raise hundreds of pigs but suffered losses due to disease. In 2021, he switched to raising buffalo.

Credit officers of Agribank Lang Giang - Bac Giang II Branch checked the use of loan capital of Mr. Hoang Van Hung's family.

At the end of July, Mr. Ha Van Hoe in Te village, My Thai commune was also lent 300 million VND without collateral by Agribank Lang Giang - Bac Giang II Branch to repair barns, buy more breeding pigs and animal feed. Because Mr. Hoe's family's land use right certificate is in the name of the household, if he borrows under the form of mortgage, he must have all the signatures of his children, including those working abroad. "I was worried about how to manage, but the credit officer guided me to prepare a loan application without collateral. Thanks to that, I had the investment capital in just one day," Mr. Hoe said. Currently, in Mr. Hoe's barn, there are more than 10 sows and 20 pigs, expected to be sold at the end of the year, earning several hundred million VND.

Cases like Mr. Hung and Mr. Hoe are no longer rare in many localities. The expansion of the loan mechanism without collateral has been helping thousands of farming households have the opportunity to quickly access capital, not missing the time to invest and develop production.

Leverage for rural economic development

In recent years, along with the policy of promoting sustainable agriculture and rural areas, the Government has issued many specific credit policies, creating a legal corridor for people and cooperatives to access capital more conveniently. Three important decrees, including Decree 55/2015/ND-CP, Decree 116/2018/ND-CP and Decree 156/2025/ND-CP (effective from July 1, 2025), have marked a major step forward in credit policies serving agriculture and rural areas. While Decree 55 paves the way for households, individuals, and cooperatives to borrow capital without having to mortgage, Decree 116 continues to improve the appraisal process, simplify procedures, and expand beneficiaries. In particular, the newly issued Decree 156 has increased the maximum loan amount to 300 million VND for individuals, 500 million VND for business households, 3 billion VND for farm owners and 5 billion VND for cooperatives, while reducing administrative procedures and records.

According to the new regulations, borrowers only need a loan application form, citizen identification, a feasible production and business plan, and personal information confirmation via the VNeID electronic identification software... In some cases, borrowers can submit a land use right certificate for the bank to keep without mortgage. Compared to the mortgage loan form, this new mechanism significantly shortens the time, cost, and steps.

According to statistics, Agribank branches in Bac Ninh province have provided loans to about 36,000 customers without collateral, with a total amount of more than VND 4,000 billion. However, the implementation of the policy still has limitations. Most of the borrowers are small individual households, while cooperatives, farm owners and cooperatives account for a very low proportion. There are branches that have not been able to disburse loans to cooperatives and farm owners since the beginning of 2025. The main reason is that without collateral, the assessment of the borrower's financial capacity, reputation and ability to repay the loan is mainly based on the production and business plan and confirmation from local authorities. Meanwhile, many cooperatives, farm owners and cooperatives do not have financial reports or records of incomplete investments, lack transparency in input and output production, making it difficult for banks to accurately assess. In addition, the State currently does not have a specific risk-sharing mechanism with credit institutions. When customers have civil disputes outside, the enforcement agency will request the bank to return the customer's land use right certificate for processing. This makes many banks cautious, only stopping at a small scale or applying to groups of familiar customers.

To overcome the above shortcomings, according to Mr. Pham Van Dong, Deputy Director of Agribank Lang Giang - Bac Giang II Branch, the unit is focusing on improving credit appraisal capacity, shifting from "asset-based lending" to "lending based on borrower efficiency and reputation", and at the same time requiring credit officers to closely coordinate with loan groups and grassroots organizations to regularly grasp the production and business situation of customers, promptly support information on the market, livestock and crop farming techniques.

Local authorities need to promote their role in verifying, monitoring, and confirming personal information, land, and production status of borrowers; at the same time, step up propaganda so that people understand their rights and obligations when borrowing capital. Cooperatives and farm owners also need to pay attention to transparency in their input and output cash flows, creating conditions for banks to appraise and evaluate realistically.

Article and photos: Do Thanh Nam

Source: https://baobacninhtv.vn/vay-von-khong-can-the-chap-trong-nong-nghiep-thao-go-vuong-mac-nang-hieu-qua-chinh-sach-postid428423.bbg