The Government’s Small and Medium Enterprise Development Foundation (SMEDF) will receive applications for the first stage of the programme on financial support for small- and medium-sized enterprises (SMEs) until the end of this month.

In the first phase, SMEDF will implement four support programmes for four specific beneficiaries.

The first programme is for innovation and creativity group with a total loan of VND100 billion (US$4.4 million). Each funded project will have a maximum loan of VND10 billion for 24 months. The programme prioritises projects that are supported by Government funds, incubators or venture capitalists, aiming at promoting innovations. In addition to this, awarded projects in start-up competitions held by Government agencies and national business organisations are also eligible for priority consideration.

The second group is agro-forestry-fisheries firms with a loan limit of VND180 billion. A firm can borrow maximum of VND20 billion for a period of 18 months. This programme is for projects that have been operational for at least two years.

Loans for supporting business in the processing industry is VND180 billion; each accepted project can get VND25 billion in one and a half year.

SMEs working in the field of wastewater treatment are entitled to loans of up to VND25 billion each in two years. The total amount of loans for this group is VND100 billion.

This year, the total limit of SMEDF’s financial support programmes is VND560 billion, and the fixed interest rate during the loan period is 7 per cent per year.

SMEs with a total capital of more than VND100 billion, and State-owned enterprises or SMEs operating in imported scrap recycling sector are not eligible to apply for this programme.

SMEDF was founded following the Prime Minister’s Decision No 601/QD-TTg issued in April 2013. It is known as a public financial institution and began operations officially in April last year. It aims to provide support to SMEs nationwide by direct lending, credit guarantee, venture capital, crowd funding and enhancing the SMEs’ capacity.

The diversification in SMEDF’s support measures will help improve the efficiency of the financial support being provided to SMEs, especially to start-ups which are in a disadvantageous position to access loans due to the shortage of mortgaged assets. — VNS