Expanding credit to repel black credit

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Objects of black credit activities redirect to take advantage of technology, social networks … to solicit and seduce borrowers.

Deputy Governor Dao Minh Tu spoke at the conference. (Photo: Government Newspaper).

Speaking at the Workshop “Warning of black credit traps, promoting official credit channels”, taking place on November 12, in Quang Ninh, Standing Deputy Governor of the State Bank of Vietnam Dao Minh Tu said to To push back black credit, it is necessary to expand credit and give priority to concentrating loans for the fields of agriculture, rural areas, small and medium-sized enterprises, and develop convenient consumer credit products suitable to all classes of people.

According to the Deputy Governor, black credit crimes in recent years have become more and more deformed, causing many consequences.

In particular, in the face of the negative impact of the COVID-19 epidemic that has left many workers in difficulty, losing their jobs and having no money to spend, black credit criminals have taken advantage of this situation to expand the “debt trap” through many new forms, methods and tricks.

Lieutenant Colonel Do Minh Phuong, Deputy Head of the Criminal Division, Criminal Police Department (Ministry of Public Security) also said that business suspension, unprofitable business, salary debt, job loss, and reduced income caused Demand for loans to serve daily life and business increased.

Black credit activists redirected to take advantage of technology, social networks… touting and seducing small businesses, low-income workers, workers, teenagers, etc. borrow money.

“Criminal objects are active in lending money with heavy interest in the form of hail, targeting a small number of small traders, small business people, teenagers, and those who need money to “borrow hot” to serve their needs. illegitimate, personal consumption…” Lieutenant Colonel Do Minh Phuong said.

However, in more than two years since the Prime Minister issued Directive No. 12/CT-TTg on April 25, 2019, the situation of crime and law violations related to black credit activities has made positive changes.

Lenders and debt collectors no longer operate openly and act impulsively as before; people’s awareness and vigilance has been gradually improved; the state of hanging signs, pasting leaflets and advertising sharply decreased.

In addition, the Head of the State Bank said that the channels providing credit for life and consumer credit have basically met the capital needs of all customer segments from large-value loans to small consumer loans.

Many credit institutions have diversified their approach to customers to expand and improve credit quality through close cooperation with local authorities, socio-political organizations such as the Farmers’ Union, Women union.

According to Deputy Governor Dao Minh Tu, credit for the economy, especially credit for vulnerable areas, is at risk of being victims of black credit such as small and medium enterprises, agriculture, rural areas, consumer loans, serving urgent life, the poor, policy beneficiaries,… still maintained a good growth rate, in some areas the growth rate was higher than the general credit growth rate, despite the heavy impact of the COVID-19 pandemic.

Statistics of the State Bank show that by the end of October 2021, the credit balance of the whole economy reached over VND 9.99 million billion, an increase of 8.72% compared to the end of 2020.

Credit for priority areas with good growth, outstanding loans to the agricultural and rural sectors are easy to generate black credit activities, reaching over VND 2.48 million with more than 14 million customers, accounting for over 25% of the total credit balance of the economy, an increase of 9.2% compared to the end of 2020 and an increase of 32.8% compared to the time before the issuance of Directive 12/CT-TTg.

In particular, credit institutions also boosted lending for living needs, consumer loans, the whole system has 78 credit institutions participating in lending for life with outstanding loans of nearly 1,800 USD. 95 million billion dong, accounting for 19.6% of the total credit outstanding balance of the whole economy, up 5% compared to the end of 2020, an increase of 9.55% compared to the end of 2018 and an increase of 5.4% compared to the previous year. before the issuance of Directive 12/CT-TTg, in which long-term loans accounted for a large proportion of 84%.

But the Deputy Governor also acknowledged that there are still limitations in repelling black credit such as illegal acts in cyberspace related to increasingly complex black credit activities.

Although credit institutions have actively diversified consumer credit products and simplified loan procedures, some people still seek to borrow money from black credit because to demand for loans is not legal (gambling, drugs, illegal business,…) or due to consumption habits, fear of contact with banks,” said the Deputy Governor.

Therefore, according to the Deputy Governor, it is necessary to promote the official credit channel, contributing to preventing and repelling black credit.

Along with that, deploying solutions to remove difficulties for customers affected by COVID-19, natural disasters, epidemics or when people face difficulties due to legitimate reasons and cannot pay their debts on time such as: consider extending debt, adjusting debt repayment terms, helping people to increase access to bank credit capital, not having to borrow money from black credit lenders.

An important point that the banking sector needs to implement is to continue reforming administrative procedures in credit and banking activities, improving processes and procedures, shortening the time for loan approval; encourage the development of a mobile banking model in disadvantaged areas, enabling customers to more convenient access to capital and other banking services.

Lieutenant Colonel Do Minh Phuong also said that the People’s Committees at all levels, socio-political organizations should coordinate with the State Bank and relevant ministries and branches to promptly solve social security issues in and around the world. after the COVID-19 epidemic; grasping difficulties and obstacles in accessing capital in order to have solutions to solve them, contributing to limiting people who have legitimate needs of borrowing money, serving production and business, must turn to black credit activities.

At the same time, the Ministry of Public Security continues to direct police units and localities to tighten the state management of security and order related to crime prevention and combat and law violations related to black credit activities.

Source: vietnambiz.vn – Translated by fintel.vn