Why is credit growth showing signs of slowing down?
- 139
- Business
- 21:34 16/08/2024
DNHN - Recently, credit growth has shown signs of slowing down, which has attracted the attention of many economic analysts and policymakers. Several factors have contributed to the slowdown in credit growth.

According to a report by the State Bank of Vietnam (SBV), credit growth increased and reached 6% at the end of June but then decreased to 5.3% by July 17.
Viet Dragon Securities Corporation (VDSC) assessed that the increase in credit during the first two quarters of the year and the slowdown in July 2024 reflects the overall trend of credit growth.
In a recent statement, Associate Professor-Dr. Nguyễn Hữu Huân from the University of Economics Ho Chi Minh City suggested that the economy's capital absorption was slow in the first half of the year and only began to improve by the end of the second quarter of 2024. He explained that seasonal factors in the first quarter, weak market demand, and the unclear recovery of the real estate market were the main reasons. He predicted that credit growth this year could reach 11-12%.
Although the SBV has implemented several programs to support banks and businesses in developing credit, analysts believe that there needs to be an increase in domestic supply to boost credit growth.
Overall, considering the goals, solutions, and forecasts for 2024, as well as the performance results in the first few months of the year, it can be seen that to achieve the 14-15% credit growth target set by the SBV, the banking system will need to make great efforts in the remaining months of 2024. They will need to provide a suitable amount of credit capital to meet production, business, and consumption needs in the second half of the year, while also effectively controlling credit risks.
The State Bank of Vietnam has implemented tight monetary policy to control inflation and maintain economic stability. Measures such as raising the basic interest rate and higher reserve requirements have increased borrowing costs. This has led to businesses and individuals being less inclined to borrow, affecting the rate of credit growth.
The global economic situation is currently facing many uncertainties, including trade tensions, fluctuations in raw material prices, and economic recessions in some regions. These factors have reduced investor and business confidence in economic prospects, causing them to limit borrowing and expansion activities, thereby affecting credit growth in Vietnam.
Recently, financial regulators in Vietnam have increased control and regulation of credit activities to ensure the stability of the financial system. The tightening of credit conditions, especially for high-risk sectors, has reduced many businesses' access to capital, leading to a slowdown in credit growth.
Currently, the demand for loans from businesses and individuals is also trending down. In the context of the economy not fully recovering after the pandemic and many businesses facing difficulties in maintaining operations, the demand for loans for investment and consumption has decreased. This has reduced the amount of credit that financial institutions can provide.
Many domestic businesses are currently facing financial difficulties, reducing their ability to repay debts and making banks more cautious in granting credit. Businesses are struggling to raise capital and maintain operations, which in turn slows down credit growth in the economy.
Therefore, the slowdown in credit growth results from many combined factors, including tight monetary policy, global economic instability, strict financial regulations, reduced borrowing demand, and the financial difficulties of businesses. To improve the situation, there needs to be close coordination between financial policies and timely support for businesses to promote recovery and credit growth.
Nhan Ha
Related news
#banking system

Restructuring the banking sector through mandatory transfers
The State Bank of Vietnam (SBV) has decided on the mandatory transfer of Vietnam Construction Bank (CB) and Ocean Commercial Bank (OceanBank) to Vietcombank and Military Bank (MB), respectively.

The banking sector is the highest brand value growth area in 2024
A total of six major banks have made it into the Top 10 strongest brands in Vietnam, including Vietcombank, BIDV, VietinBank, Techcombank, Agribank, and VPBank.

The State Bank of Vietnam studies the roadmap to remove credit room
The State Bank of Vietnam (SBV) is considering a roadmap to remove the credit room mechanism as directed by the National Assembly and the Government.

Significant drop in fraud cases following nearly three months of biometric authentication implementation
According to statistics from banks, the implementation of biometric authentication regulations has effectively deterred high-tech criminals from using personal accounts for money transfers.

BIDV received 02 prestigious international awards for corporate products and services
Vietnam Joint Stock Commercial Bank for Investment and Development (BIDV) has just been awarded the titles of "Best API Application & Open Banking Bank in Vietnam" and "Best Trade Finance Bank in Vietnam" for 2024 by The Asian Banker.

Bank interest rates on 31st October: Major players compete fiercely
Bank interest rates have been highly volatile, with one bank making its second rate adjustment in the month as of October 31, 2024, underscoring the competitive landscape.
Đọc thêm Business
Foreign investors expected to open 150,000 new securities accounts in the next 5 years
The Ministry of Finance has set an ambitious target to increase the number of securities trading accounts held by foreign investors in Vietnam to 200,000 by 2030—four times higher than the current figure.
Vietnam launches “Private Economy Panorama Model” to foster public-private national development
Billionaire Nguyen Thi Phuong Thao emphasizes that entrepreneurs’ responsibilities extend beyond profits to creating social value.
Deputy Prime Minister Lê Thành Long meets with Osaka Governor Yoshimura Hirofumi to promote Vietnam–Japan cooperation.
As part of his working visit to Japan and participation in the Vietnam National Day at EXPO 2025 Osaka, on September 8, Deputy Prime Minister Lê Thành Long held talks with Osaka Governor Yoshimura Hirofumi.
Larry Ellison’s lesson: Enduring success starts with fixing the market’s pain points
As of today, Larry Ellison has risen to become the world’s second-richest billionaire with a fortune of nearly $260 billion, surpassing familiar names such as Jeff Bezos and Warren Buffett.
The master sales secrets of luxury king Bernard Arnault that make the world spend
Billionaire Bernard Arnault, Chairman of LVMH (Moët Hennessy Louis Vuitton), controls more than 70 of the world’s most prestigious luxury brands, from Louis Vuitton and Dior to Moët & Chandon and Bulgari.
White House: When politics and technology join forces to rewrite the global AI order
The White House became the epicenter of global attention as U.S. President Donald Trump and First Lady Melania Trump hosted a high-profile state dinner, bringing together more than 20 of the most powerful leaders in technology and American business.
Warren Buffett: The contrarian billionaire – What can Vietnamese entrepreneurs learn?
Warren Buffett has never invented a piece of technology, created a product that changed the world, or relied on social media.
Vietnam Golf Course Owners Summit 2025: Driving sustainable growth in golf tourism and golf economy in Vietnam
Vietnam Golf Course Owners Summit2025 (VNGOS 2025), focusing on the sustainable development of golf tourism and the golf economy in Vietnam, will be held for the first time on October 30 - 31, 2025, at Laguna Lăng Cô Resort, Hue City.
President Luong Cuong’s visit to China: A message of Vietnam’s diplomacy
From September 2 to 4, 2025, President Luong Cuong led a high-level Vietnamese delegation to attend the 80th anniversary of the world’s victory over fascism and to carry out a series of high-level diplomatic activities in China.
Prof. Dr. Huynh Van Chuong: A strategy to elevate Vietnam’s education on the global stage
On the occasion of the 80th anniversary of Vietnam’s education sector and the opening of the 2025–2026 academic year, Professor Huynh Van Chuong shared insights on key achievements in education quality management.