HANOI: Vietnam should simplify certification requirements for green projects and build a digital data platform for environmental data to help small and medium enterprises (SMEs) access green loans, experts said at a conference on green capital held on June 23.
Statistics from the State Bank of Vietnam (SBV) showed that outstanding green loans totalled 828 trillion dong by the end of the first quarter, up 4.6 times from 2017, when the programme was launched, but accounted for only about 4.3% of total credit in the economy.
Most of the funding has gone to projects in agriculture, forestry, fisheries and renewable energy, with a total outstanding loan of more than 63%.
Deputy director at the Private Economic Development Research Board Bui Thanh Minh said that green finance has mainly been directed towards large projects with clear business models, collateral and documentation that satisfy banks’ appraisal requirements.
SMEs, which account for 97% to 98% of businesses in Vietnam, often struggle to access green loans because they lack standardised environmental data, governance systems and collateral, while around 80% have no prior credit history, he said.
If green finance policies are designed only for large enterprises, the green transition will not be inclusive, Minh said.
He went on to warn that smaller firms face a double challenge of being unable to secure financing for green transitions, while also risking the loss of markets as environmental standards become stricter.
Data remains one of the biggest obstacles to expanding green lending.
Many companies, particularly SMEs, lack the environmental records and reporting systems required to qualify for green loans, while banks face difficulties accessing reliable information to assess projects and monitor risks.
Bui Khanh Dung, director of eco-friendly manufacturer Musa Pacta, said many businesses – especially smaller ones – do not know where they stand in the green transition, because Vietnam lacks a unified and practical set of green standards.
He proposed establishing a transparent scoring system that would allow companies to measure their compliance with green criteria and identify areas for improvement before approaching banks.
Scores should be linked to preferential lending rates, unsecured loan ratios or credit limits to create stronger incentives for businesses to invest in green upgrades rather than viewing them as an additional cost, Dung said.
Meanwhile, Nguyen Hong Quang, deputy director general of the Environment Department under the Agriculture and Environment Ministry, said data is the weakest link in Vietnam’s green finance ecosystem.
Unlike conventional lending, green credit requires banks to measure greenhouse gas emissions reductions and resource efficiency. — Viet Nam News/ANN
