VINASME supports businesses in enhancing their capital access capabilities

DNHN - To support businesses in enhancing their capital access capabilities, experts and speakers shared many insightful ideas at the training session on “Credit rating for small and medium-sized enterprises (SMEs), enhancing capital access capabilities”.

The event was jointly organised by the Vietnam Association of Small and Medium Enterprises (VINASME) and the Association of Chartered Certified Accountants (ACCA) on the morning of March 29 in Hanoi.

In his opening speech, Dr To Hoai Nam - Standing Vice President and General Secretary of VINASME shared: “Credit rating is a long process. VINASME has been nurturing this idea since the reality is that only about 30-40% of small and medium-sized enterprises have relatively easy access to credit capital. We may not dare to implement a plan with an ambitious goal, but we want to open up a new activity to start the process of credit rating for enterprises. On that basis, it will serve as a premise for organisations, state agencies, and enterprises to work with us to create a new direction. It is very difficult to do that, and we cannot do it alone. Therefore, in 2023, VINASME signed a strategic cooperation agreement with the Association of Chartered Certified Accountants. And today, in addition to the support of ACCA, we also have the support of leading experts. With such preparation, we can contribute to the story of credit for businesses, enhancing capital access capabilities. That is the significance of the programme. Today, experts will talk about business credit, and the related factors that affect business credit, both in theory and in practice.”

As a co-organiser, ACCA was founded in 1904 and is the largest and fastest-growing international professional body for accountants, auditors, financial professionals and managers, with over 526,000 students and 247,000 members in over 180 countries worldwide. ACCA is also one of the first international associations in Vietnam. Over the years, ACCA has always accompanied important events in the accounting, auditing and finance sector in Vietnam, such as contributing to the drafting of the Accounting Law, the Independent Auditing Law, and the Development Strategy for the Auditing and Accounting Sector to 2030 of the Ministry of Finance, etc.

In the context of today’s macroeconomic situation and the global economy undergoing the most complex and volatile period of change, the private business sector plays an important role in driving economic growth and fostering innovation. However, the complex financial environment can pose significant challenges for businesses today. Recognising this, ACCA has designed a fundamental support programme to equip businesses with knowledge and directions to develop more competitively in the context of an increasingly internationalised market.

At the Programme, Mr To Quoc Hung - Country Director of ACCA Vietnam shared: “Today, with the support of VINASME, ACCA is honoured to co-organise the training programme on credit rating for small and medium-sized enterprises, enhancing capital access capabilities. Today’s training programme is part of ACCA’s series of support activities for businesses, demonstrating a long-term commitment to enhancing the competitiveness of small and medium-sized enterprises.

Sharing with reporters, Mr Hung added: “In the process of cooperating with associations, specifically the Vietnam Association of Small and Medium Enterprises, to support small and medium-sized enterprises in enhancing their access to credit capital, today we have organised a forum with the Vietnam Association of Small and Medium Enterprises for the parties to share their views. For example, the question of how to remove the problem of access to capital will be answered from the perspective of the Bank. In addition, we will have more perspectives from the Credit Rating side and we will also receive perspectives from the Vietnam Association of Small and Medium Enterprises, as well as many opinions from businesses. And when all parties have the opportunity to sit together, I believe that we will find the bottlenecks and remove the current obstacles. That is one of our wishes, goals and expectations when organising today’s forum.”

Also at the programme, representing the research team, Mr Tran Van Hien - Deputy Head of VINASME’s Training Department presented the difficulties of SMEs in accessing credit capital, including No secured assets; having secured assets but the asset value is low, the loan-to-value ratio is low; unsecured loans are very difficult to access; lending based on cash flow and working capital cycle is also not feasible; projects have low feasibility; financial statements lack reliability; no business plan and self-reported financial statements for 3-4 years.

“Credit rating has been around for a long time, but so far, the rating has only been for large enterprises listed on the stock exchange, while no organisation has yet to rate SMEs. Therefore, in the face of that reality, today VINASME, together with ACCA and some other organisations, have coordinated to organise the Training Programme on Credit Rating for Small and Medium Enterprises - Enhancing Capital Access Capabilities,” said Mr Hien.

Also in the programme, the Director of the Hoang Mai Branch of Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) - Ms Nguyen Thi Bich Hanh shared: “Successfully accessing capital from banks, especially state-owned banks, demonstrates the prestige of the enterprise. To access credit capital from banks, first of all, it is necessary to have legal capacity, creditworthiness, operational capacity and secured assets.

Presenting the green credit solution, Ms Hanh said that the green transition is an urgent process that directly affects the global economy. Ms Hanh informed: “Vietnam needs to invest an additional 368 billion USD by 2040, equivalent to 6.8% of GDP/year, to adapt to climate change. Which, investing in resilience is about 254 billion USD and 114 billion USD for the decarbonisation journey as committed to the international community. As of September 30, 2023, the outstanding green credit balance of the banking system reached over 564 trillion VND, accounting for about 4.4% of the total outstanding debt of the entire economy, of which the main focus is on renewable energy, clean energy (nearly 45%) and green agriculture (over 30%). VietinBank’s credit orientation in the future will be to prioritise green credit and proactively allocate resources to support Vietnamese enterprises to invest in resource management, environmental protection and climate change response, reduce emissions and adapt to climate change. Currently, VietinBank’s funding portfolio has increased by nearly 400% with nearly 50,000 billion VND for projects related to renewable energy development, water treatment, waste treatment, etc.”

After the speakers’ presentations, the programme held a discussion session on removing obstacles for businesses in accessing non-traditional capital sources. At the discussion session, the experts all agreed that capital and bank credit are considered important factors in ensuring the continuous operation of small and medium-sized enterprises, contributing to improving the efficiency of capital use of enterprises, forming an optimal capital structure and focusing capital on production, enhancing competitiveness, etc. However, in reality, SMEs still face difficulties in accessing bank capital. Among them, there are reasons related to bank loan procedures and collateral, and the proportion of SME loans is still modest.

Ms Hanh shared that: “On the side of commercial banks, banks should design specific products for SMEs, and develop appraisal methods suitable for SMEs. In addition, it is necessary to strengthen the provision of services such as consulting, training, and information support for SME customers. When both sides are proactive in terms of information and connection, it will be easier to meet and approach each other.”'

Regarding the practical difficulties and advantages when implementing credit rating for SMEs discussed in the programme, sharing more with reporters about solutions to enhance capital access for enterprises, Mr Nguyen Quang Thuan, Chairman of the Board of Directors of FiinGroup said: “In small and medium-sized enterprises in Vietnam, the biggest difficulty that limits enterprises in the process of accessing capital is the issue of information transparency, especially the quality of financial statements. Therefore, I would like to recommend that leaders of small and medium-sized enterprises focus, not only on expertise and good product/service quality but also on the issue of information transparency and the quality of financial statements, as well as how to improve the credit score and credit rating of the enterprise in the eyes of not only credit institutions but also business partners.”

Bao Trinh