Proposing companies to get mortgage loans secured by collected paddy and rice

On August 12, the Ministry of Industry and Trade submitted a document to the Prime Minister outlining steps to facilitate capital procurement for the purchase of paddy, rice, and commodities.

According to the paper, after monitoring market conditions and exchanging information between the MoIT's specialized Working Group, the Vietnam Food and Foodstuffs Association, and rice exporters, the fact has shown that access to finance has yet to be advantageous.

To address the situation, the ministry recommended that the Prime Minister appoint the Vietnam State Bank (VSB) to direct commercial banks with two objectives: supporting businesses' interest rates and creating favorable conditions for businesses to obtain mortgage loans repayable with collected products.

On August 10, VSB issued a document requesting commercial and state banks in Mekong Delta provincial and municipal branches to guarantee the availability of credit capital sources for the purchase, temporary storage, and processing of paddy and rice in the area.

Numerous steps have been implemented, including increasing the credit limit available to traders and businesses; reforming and simplifying internal processes and procedures; reducing the time required for loan approval, and diversifying credit products.

However, because southern provinces and cities are affected by the Covid-19 pandemic, the majority of businesses in the area do not meet the requirements of agricultural and rural development credit policies established by Decree No. 55, Decree 116, and State Bank guiding circulars on lending for paddy and rice export business.

Rice production has recently increased in the Mekong Delta. Rice varieties OM 9582, OM 5451, and OM 18 cost between VND 4,200 and 5,000 per kilogram; IR50404 costs between VND 3,800 and 4,200 per kilogram; and sticky rice costs between VND 4,000 and 4,600 per kilogram.