Supporting Small Firms in Vietnam—With Help From Bankers

At BTC, bankers learn how to better understand and address specific needs of small and medium enterprises. © IFC

Small- and mid-size businesses in Vietnam have long struggled to obtain the financing they need to grow and thrive. This is problematic for a country that depends on such businesses for 40 percent of its GDP and 77 percent of its jobs.

As far back as 2001, IFC began working on a solution: training local bankers to better understand and address the special needs of small and medium enterprises, or SMEs. We helped set up a three-person operation in Ho Chi Minh City to teach bankers to design and launch innovative finance products for SMEs.

The initiative blossomed into the country’s leading provider of training in international best practices in banking—the Banking Skills Training and Consultancy Joint Stock Company, or BTC. Today, BTC maintains a wide network of more than 400 local and foreign associates.

Over the past 15 years, BTC has trained an impressive 100,000 bankers through hundreds of international-standard training courses. In 2012, its Hanoi Branch became the Institute of Manpower in Banking and Finance, with a license to operate longer-term courses. It is now a standalone for-profit self-funded institute.

"In 2005, 10 local banks joined hands to run BTC as a technical training center, to meet the need for improving skills and capacity of their own staff. We would not have imagined BTC becoming a leading professional training provider for the Vietnamese banking sector,” said Nguyen Duc Vinh, BTC former chairman.

 

Ripple Effect

Bankers trained at BTC have gone on to help their SME clients to flourish.

Nguyen Thi Phuong Hang, deputy director at the Hanoi branch of An Binh Commercial Joint Stock Bank, helped a rice-seed company secure financing to acquire and develop a high-quality seed-processing factory in Hung Yen province. With Hang’s help, the Tropical Agriculture Joint Stock Co. also obtained a working-capital facility to expand its domestic and export business. Tropical has since more than doubled its revenue to $2.2 million and employs 50 people. It plans to hire another 50 soon.

“I got a good understanding about small businesses and how to serve them better,” says Hang, referring to the training she received at BTC.  “I am confident now that I can find solutions to meet the needs of my SME clients.”

Offering courses on SME Banking, Risk Management, and Credit Training, BTC also helps young financial professionals get trained for banking jobs. Its Future Bankers’ Program, started in 2010, has trained and certified 2,500 students. About 80 percent of them found banking jobs within six months of completing the program.

“With the knowledge I gained, I perform better at job interviews and tests,” says Duong Hoang Anh, who received two job offers as soon as he finished the program. He now works as a personal financial consultant at the Asia Commercial Joint Stock Bank, a bank he has always wanted to work for.

IFC continues to work with BTC to deliver training courses to help enhance access to finance. Subjects include credit bureaus, trade finance, internal audits, risk management, corporate governance, and new financial products. With IFC’s help, BTC is playing an important role in Vietnam’s banking sector and the thousands of small businesses it services.

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Published in March 2017

 

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