According to experts, after May 1, 2006, the Vietnamese automobile market will heat up. Taking advantage of this opportunity, many banks have co-operated with local manufacturing and assembly enterprises or automobile importers to promote their loans for automobiles.
Many customers said that it was an attractive policy as many families had decided to buy cars even though earlier they had no intention to buy them.
Apart from hire purchase automobiles, most banks have provided loans for customers to buy brand new and second hand cars. So far, the Oriental Commercial Joint stock Bank (OCB) has realised that the demand for loans for buying cars has heated up, so it has separated the service from its consumer loan programme. OCB has co-operated with around 30 agents of automobile firms in Vietnam to develop its service of providing loans for customers to buy cars, which accounts for between 20 and 30 per cent of its total debts. Similarly, the Asia Commercial Joint stock Bank (ACB) has seen its total loans for automobile customers increase by 10 per cent against early this year. Each day, transaction offices of each branch receive one or two applications for loans from automobile buyers. Can Thi Ngoc Tram, deputy head of the Sale Department of the Southeast Asia Commercial Joint stock Bank (SeaBank), said every month her bank provided loans to around 20 automobile buyers. SeaBank reached VND 130 billion in loans for automobile buyers, up by VND 20 billion against the second quarter of 2005.
Tram said that procedures for customers to get loans for buying cars were similar to procedures for loans to buy other valued assets. Accordingly, the duration and proportion of loans depend much on value, trademark and average depreciation time of each type of car. For example, cars of Transinco and Daewoo, banks provide loans for customers maximally equal to 50 per cent cars’ value in a maximum duration over 30 months. Those who buy cars of Ford, Toyota, Mercedes, Honda and BMW can get loans maximally equal to 70 per cent of their cars’ value for 60 months. For second hand cars, banks concentrate on providing loans for those who buy Toyota, Lexus, Ford and Mercedes cars, maximally equal to 60 per cent of their cars’ value for 40 months.
Earlier, banks provided loans for hire purchase cars for 36 months. If buyers mortgage their cars, they can borrow 60 per cent of their cars’ value. However, to meet increased demand from customers and to attract them, many banks have loosened conditions and extended their loan duration to 48 months. If customers mortgage, they can borrow up to 90 per cent of their cars’ value.
Ha Phuong
Vietnamese
