More than 10 commercial banks in Vietnam have announced new lending-rate reductions and preferential credit programs since mid-August, following a government push for banks to make borrowing costs more affordable for households and businesses.
The latest measures include interest-rate cuts of up to 2.5 percentage points a year at some banks, while several large lenders have introduced preferential credit packages worth tens of trillions of Vietnamese dong. The measures are aimed particularly at businesses, small and medium-sized enterprises, exporters and sectors identified as priorities for economic growth.
The move follows a directive from Prime Minister Lê Minh Hưng calling on the State Bank of Vietnam and credit institutions to reduce lending rates in a substantive way rather than simply making commitments without translating them into lower borrowing costs.
The government has also urged banks to reduce operating costs and improve the flow of credit to the economy. The policy comes as global economic conditions remain uncertain, with developments affecting exchange rates, domestic interest rates, liquidity and credit conditions.
Under the latest direction, banks are being encouraged to channel more capital towards manufacturing, exports, high technology, supporting industries, agriculture, innovation, social housing and major infrastructure projects.
The State Bank of Vietnam had previously asked commercial banks to develop and publish lending-rate reduction programs beginning in August. Preferential rates under these programs are expected to be at least 1 percentage point lower than each bank’s average lending rate for loans of a comparable maturity, with banks also encouraged to reduce or waive applicable service fees.
State-owned banks have taken a leading role in the latest lending-rate campaign. Agribank, BIDV and VietinBank have each announced preferential credit programs worth between 50 trillion and 70 trillion Vietnamese dong.
Agribank has introduced a 70 trillion dong program with lending rates 1 to 2 percentage points below its average rate for comparable maturities. The program is scheduled to run through 2028.
BIDV has announced a 50 trillion dong preferential lending package, with rates at least 1 percentage point below its average rate. The program is available from August until the end of the year or until the allocated credit limit is exhausted.
VietinBank has also allocated 50 trillion dong for preferential lending, with rates at least 1 percentage point below its average comparable lending rate. Its program is scheduled to continue through the end of 2028.
Private-sector banks are also joining the effort, although the size and structure of their programs vary considerably.
SHB has expanded its preferential credit program to 47 trillion dong, including an additional 2 trillion dong. Some borrowers can receive reductions of up to 2 percentage points a year, while the newly added portion carries rates 0.5 to 0.7 percentage points lower than applicable standard rates.
Sacombank has taken a different approach by reducing rates not only on new loans but also on part of its existing lending portfolio. The bank has targeted exporters and importers, with a preferential program involving around 100 trillion dong of existing loans and an additional 10 trillion to 15 trillion dong in new credit.
For eligible import-export businesses, Sacombank has announced reductions of up to 2 percentage points. New lending under the program carries rates of around 8.5% to 9% a year, with the program running from August 13 through December 31.
KienlongBank has announced the deepest headline reduction among the banks listed in the latest program, offering lending-rate reductions of up to 2.5 percentage points a year.
NamABank has introduced a 25 trillion dong specialised credit package. Rates under the program are 1 to 1.8 percentage points below standard comparable rates, while lending for individual production and business activities receives reductions of around 0.5 to 0.7 percentage points.
BVBank has allocated 2.5 trillion dong for preferential lending, with rates at least 1 percentage point lower and rates starting from 9.7% a year.
MSB has announced a 3 trillion dong program, with preferential rates at least 1 percentage point below its comparable average rate and rates starting from 8.5% a year.
BacABank has offered a maximum margin reduction of 0.5 percentage points, with preferential lending rates starting from 9.4% a year. Its current offer is scheduled to run until the end of October 2026, with preferential terms available for up to 12 months.
The scale of these programs shows that the latest lending-rate campaign is not limited to a single group of banks. Both state-owned and private lenders are responding, although they are targeting different customer groups and applying different levels of interest-rate reductions.
Businesses are a major focus of the new programs. Small and medium-sized enterprises, household businesses, exporters and companies operating in priority industries are among the main beneficiaries.
The emphasis on SMEs is particularly important because smaller companies can face greater difficulties obtaining affordable financing than large corporations. Lower borrowing costs could help businesses manage working capital, expand production and invest in new equipment or technology, provided they meet individual banks’ lending conditions.
Export-oriented businesses are another important target. Sacombank, for example, has specifically focused its rate reductions on import-export companies and foreign-invested enterprises. The approach reflects concerns over exchange-rate movements and uncertainty surrounding international trade.
NamABank has divided its 25 trillion dong package across several sectors. Agriculture, forestry and fisheries account for 15 trillion dong, while infrastructure and digital technology receive 4 trillion dong. Another 3.6 trillion dong is allocated to seafood and fruit exporters, 1.4 trillion dong to businesses operating in industrial parks and 1 trillion dong to SMEs and smaller businesses.
The structure of these packages suggests that banks are prioritising productive economic activity over general consumer lending.
Loans for consumption and individual home purchases make up a relatively small part of the latest preferential programs. Instead, banks are directing more of the available support towards production, agriculture, exports, technology and business activity.
This approach is consistent with the government’s broader objective of ensuring that credit contributes to economic growth. Rather than simply expanding total lending, authorities want banks to improve the allocation of capital towards sectors considered important for productivity and investment.
For borrowers, however, the headline interest-rate reduction is only one part of the cost of a loan. Eligibility requirements, loan maturity, collateral, fees and the period during which the preferential rate applies can all affect the actual cost of borrowing.
A rate advertised as being reduced by a certain percentage point may apply only to particular customers, loan purposes or periods. Borrowers therefore need to check the specific terms offered by their bank before making financial decisions.
The latest campaign also creates pressure on banks to find room within their own balance sheets to reduce lending rates. Some lenders have responded by cutting deposit rates as well. NamABank, for example, has reduced certain deposit rates by up to 0.3 percentage points as part of efforts to create additional room for lower lending costs.
For banks, reducing lending rates can put pressure on net interest margins if funding costs do not decline at a similar pace. Sacombank’s decision to reduce rates on part of its existing export-import loan portfolio is notable because the bank is accepting a significant reduction in its lending margin in order to provide relief to targeted borrowers.
The latest developments therefore represent a balancing act for the banking sector. Banks are expected to support economic activity through cheaper credit while maintaining financial stability and ensuring that lending remains commercially sustainable.
The government has also indicated that compliance with the push for lower lending rates could become relevant when future credit growth allocations are considered. This increases the incentive for banks to demonstrate that their announced programs are translating into actual support for borrowers.
The impact of the latest measures will depend on how widely businesses and individuals can access the preferential loans. Announcing large credit packages does not necessarily mean the entire amount will immediately enter the economy. Borrowers still have to satisfy credit assessment requirements, and banks must assess repayment capacity and risk.
Nevertheless, the scale of the programs marks a significant new push to reduce borrowing costs in Vietnam. With major state-owned banks committing tens of trillions of dong and private lenders introducing additional programs, competition for qualified borrowers could intensify.
The strongest reductions are currently concentrated in selected segments rather than across all types of loans. Production and business lending, SMEs, exports, agriculture and other priority sectors are receiving more substantial support than ordinary consumer borrowing.
For businesses seeking financing, the new programs could provide an opportunity to reduce interest expenses, particularly for companies operating in the sectors specifically targeted by banks. However, borrowers should compare the full terms of competing offers rather than choosing a loan solely on the basis of its advertised interest-rate reduction.
The latest lending-rate cuts also underline the government’s effort to ensure that monetary and credit policies provide more direct support to economic activity. If the measures are sustained and effectively implemented, lower borrowing costs could help businesses increase investment, maintain operations and improve cash flow.
For now, Vietnam’s banking sector is entering a new phase of competition around preferential lending. With more than 10 banks announcing reductions in a relatively short period and some offering cuts of up to 2.5 percentage points a year, the focus is shifting from promises of lower borrowing costs to how effectively those reductions reach businesses and other eligible borrowers.
