Vice Chairman Pham Duc Binh of Dong Nai Livestock Association said that loan applications of many farmers are turned down by banks as they fail to pay old debts and show good business plans.
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Vice Chairman Pham Duc Binh of Dong Nai Livestock Association said that loan applications of many farmers are turned down by banks as they fail to pay old debts and show good business plans.
In the livestock industry, most households buy animal feed based on deferred payment method and they can only make payments after selling the animals, Binh explained. Due to having suffered losses for a long time, local households are unable to pay debts and resume farming.
Given the absence of sound business plans plus mounting old debts, many of them cannot take out bank loans from the interest rate subsidy program designed with annual rate of less than 10% as expected by the central bank.
This is similar to what that has happened to husbandry companies having suffered losses over the years, Binh said. The fact that the central bank requests banks to slash lending rates to the husbandry and fishery industries for loans that had been disbursed before May 13 to a maximum 10% annually only creates conditions for companies to rotate old loans, he remarked.
The central bank has earlier released Document 3783/NHNN-TD asking five commercial banks comprising Agribank, BIDV, Vietinbank, Vietcombank and MHB to cut lending rates for the target industries to a maximum level of 10%.
The central bank in the document clarifies that the five banks need to continue to deploy the program strictly and effectively to ensure the effective credit support for the target industries in line with the instructions of the Prime Minister and the monetary authority.
(Source: SGT)
