Expanding Financing Options Can Unlock SME Growth

Experts are calling for broader financing options to help small and medium-sized enterprises (SMEs) overcome one of their biggest barriers to growth—limited access to capital.

Although SMEs make up nearly 98 percent of active businesses in Vietnam, many continue to struggle to secure funding needed for expansion, technology adoption and participation in global value chains.

Current financing programmes, including government-backed funds and credit guarantee schemes, have not fully addressed the financing gap. Many SMEs remain unable to access traditional bank loans because they lack sufficient collateral or do not meet lending requirements.

Industry experts argue that financial systems should move beyond collateral-based lending by placing greater emphasis on business performance, cash flow and supply chain activity when assessing creditworthiness.

They also recommend expanding specialised development finance institutions, strengthening credit guarantee programmes and encouraging alternative financing models that better serve small businesses.

In addition, policymakers are considering reforms that would allow banks to accept a wider range of assets, including intellectual property, movable assets and future business income, as part of lending assessments.

The proposed changes are expected to improve access to finance, encourage innovation and strengthen the competitiveness of SMEs, allowing them to contribute more effectively to economic growth and private sector development.

The discussion reinforces the growing recognition that improving financial access remains one of the most important steps in enabling SMEs to scale, innovate and create jobs.

Source: Vietnam News Agency SME financing