Loans for individuals and businesses in HCM City affected by COVID-19 will have their interest rate cut by 2 per cent under a Government resolution.

According to the HCM City-based Viet Nam Bank for Social Policies, loans carrying rates of over 6 per cent and disbursed from now until the end of 2023 will be eligible for the rate cut under Resolution 11.

But anyone with overdue loans will not be eligible, according to the bank.

“If borrowers use the loans for [other purposes], they will have to pay the interest that was cut.”

The State Bank of Viet Nam has instructed the bank to continue to provide preferential loans to pandemic-hit firms for paying salaries and continuing with their business operations.

The bank will also work with the city districts to provide loans to workers, poor and disadvantaged people and others affected by the pandemic.

The banking sector has cut lending rates by 1.8 percentage points over the past two years, according to Nguyen Thi Hong, governor of the central bank.

It would further reduce the rates by 0.5-1 percentage points by the end of 2023, she added. — VNS