Supply Chain Finance Vietnam


The Supply Chain Finance (SCF) program in Vietnam facilitates SME's access to finance, allowing them to growth production and increase productivity. This is key as about half of the SMEs in Vietnam are un- or underserved by formal financial institutions.

Country/region Period Budget
Vietnam
01.06.2018 - 31.05.2023
CHF 5'242'105
Background

By integrating local SMEs into global supply chains, the program supports Vietnam?s development and competitiveness through higher added value products, reaching global markets. The program will work with key entities involved in a typical supply chain: SMEs, corporates, banks and other service providers. They will interact on so-called SCF platforms. To achieve a well-functioning SCF platform, the program will work at three levels: 1) Improving the enabling environment for SCF mechanism- 2) Strengthening the capacity of involved bank / non-bank institutions to offer SCF solutions- and 3) Strengthening the capacity of local SMEs towards SCF.

Objectives

The program's overall goal is to improve the competitiveness of local SMEs through increased access to finance, allowing them to growth and create more and better jobs. Through the SCF platform a closer and stable relationship between the SMEs and their large business partners is created. Given the strong linkages between them, and the fact that SCF relies primarily on the credit rating of the large corporates, the credit conditions offered to SMEs will be more favorable. This is one way to address the challenge for SMEs to obtain better access to finance.

Medium-term outcomes

Outcome 1: Enabling environment for SCF improved (relevant SCF Decrees, Circulars or Guidelines approved and a common operational infrastructure developed)-

Outcome 2: Suitable SCF solutions developed and offered (aim: over 6000 SCF loans valued at 250 million USD disbursed by partner institutions)-

Outcome 3: Access to finance for SMEs through SCF increased (aim: 500 million USD working capital financing facilitated through SCF platforms).

Results

Expected results:  

Output 1.1: Interventions identified, inputs and proposals made and capacities provided for the reforms in legal and regulatory foundations-

Output 1.2: Sector capacities developed, key operating infrastructures established, and the SCF market practice generally adopted-

Output 2.1: Value proposition of SCF is clearly outlined and communicated-

Output 2.2: The operating model for SCF is designed and necessary systems, processes and products to support lending are in place-

Output 2.3: Sales and customer management capacity of partnering institutions increased-

Output 3.1: Capacity of local SMEs on the fundamentals of SCF improved-

Output 3.2: Increased adoption of SCF through SCF platforms.


Directorate/federal office responsible SECO
Credit area Development cooperation
Project partners Contract partner
  • International Finance Corporation


Budget Current phase Swiss budget CHF   5'242'105 Swiss disbursement to date CHF   0 Budget inclusive project partner CHF   5'992'105
Project phases Phase 1 01.06.2018 - 31.05.2023   (Current phase)