Vietnamese Banks Reticent to Unsecured Loans
Vietnamese banks are reluctant to offer unsecured or personal loans, saying, they lack the expertise to manage such credit risks.
According to a banker, banks prefer to offer unsecured loans to public employees rather than individuals who are not employed by the state because public employees have a steady income and their employers were willing to guarantee such loans.
While demand for unsecured loans is on the rise, the banks are choosy about how much and to whom they lend.
In fact, Vietnam’s banking system was inexperienced in evaluating and managing loan risks, said Vo Ngoc Thuy, an Asia Commercial Bank (ACB) official.
After a year of piloting an unsecured loan program, ACB has lent VND200 billion (US$12.5 million) to 11,000 clients.
The bank is scheduled to raise the unsecured loan limit for a customer to VND200 million ($12,500) instead of the current VND100 million, Thuy said.
According to an official of the Vietnam International Bank (VIBank), VIBank could lend VND150 million without security to state income earners with monthly incomes of at least VND6 million.
Ghislain Nguyen, director of the personal finance service at the Hong Kong and Shanghai Banking Corporation (HSBC), forecasts that the country will witness a growing demand for unsecured loans in the upcoming time.
HSBC is able to grant a secured loan limit of VND40-200 million for 1-3 years, Nguyen said. Thanhniennews
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