HCMC – The VND120-trillion credit package for social housing has seen interest rates fall by over 2% after two years, but disbursement remains sluggish, with only 2% of the funds released, the Ministry of Construction reported.
The credit package, rolled out in April 2023, was designed to offer low-interest loans for social and worker housing projects, supporting the target of building one million social homes by 2030.
As stipulated in Resolution 33, its interest rates are 1.5 to 2 percentage points lower than the average medium- and long-term rates of the country’s four state-owned commercial banks.
Since its launch, the State Bank of Vietnam has reduced interest rates on the VND120-trillion credit package four times. From July to December 2023, lending rates stood at 8.2% for homebuyers and 8.7% for project developers.
In the first half of 2024, lending rates under the package were lowered to 7.5–8%, followed by an additional 1-percentage-point cut in the second half of the year.
Starting in 2025, the central bank announced further reductions, bringing rates down to 6.6% for project developers and 6.1% for homebuyers.
Despite interest rate cuts, disbursement of the credit package is below expectations. According to the Ministry of Construction, only 97 social housing projects in 38 out of 64 provinces and cities have been announced as eligible for loans.
Disbursement has reached just VND3.4 trillion, accounting for a little over 2% of the total credit package. Of this amount, around VND2.94 trillion has been lent to developers of 21 projects, with the remainder allocated to homebuyers.
The Ministry of Construction attributed the low disbursement rate to several factors. Many developers do not meet the loan eligibility requirements, while the preferential interest rates are still considered relatively high and the loan terms too short, making the package unattractive to both businesses and homebuyers.
In addition, complex regulations on beneficiary groups have made it difficult for individuals to access the loans.
