In rural areas, demand for credit is often closely linked to practical production and business needs, such as covering input costs for a new crop, expanding livestock production, investing in machinery, or maintaining a small household business. In many cases, the value of a loan lies not only in its size, but also in whether the funding is available at the right time and suited to the borrower’s actual needs.

As a leading State-owned commercial bank with a key role in financing agriculture, farmers and rural development, Agribank has developed various channels to bring formal credit closer to rural households. Among these, lending through community-based lending groups remains an important approach for individual and household customers in agricultural and rural areas.

As of July 31, 2026, Agribank had more than 58,000 lending groups with over 910,000 members, representing total outstanding loans of more than VND 216 trillion. Lending through these groups was being implemented at 107 Agribank branches nationwide.

Through group leaders, local organizations and grassroots authorities, Agribank is able to better understand borrowers’ actual funding needs and communicate credit policies more effectively. Borrowers also receive additional support during the application process, the use of borrowed funds and the fulfilment of repayment obligations.

For many households, particularly those living far from urban centers, lending groups provide a practical channel connecting customers with the bank in a way that is better suited to local living and production conditions.

The involvement of the Vietnam Farmers’ Union, the Vietnam Women’s Union, commune-level authorities and other local organizations further strengthens the connection between Agribank and individual borrowers. This coordination helps ensure that credit activities remain closely aligned with local realities, while also enabling group members to exchange production experience, update information and support one another when facing difficulties caused by natural disasters, disease outbreaks or market fluctuations.

For farming households, the benefits of credit are most visible when funds are used for specific production needs. Loans used to purchase seeds, agricultural inputs, animal feed or machinery can help households better organize their production plans. For small household businesses, additional working capital can support inventory levels, improve business facilities or allow services to be expanded in line with each household’s capacity.

Household economic development does not always begin with large-scale projects. In many cases, progress comes from a series of manageable steps, such as expanding livestock herds, increasing cultivated areas, purchasing new equipment, renovating a small shop or adopting more efficient production methods.

When credit is provided in line with actual needs and at the right time, these gradual improvements can contribute to higher household income and stronger production capacity. A loan can help a family maintain a crop cycle, capture a business opportunity or overcome a temporary shortage of working capital.

Improved access to bank credit also gives rural residents more formal financing options. In rural areas, funding needs can arise quickly and may be closely linked to seasonal production, operating expenses or other legitimate and urgent household needs. When formal credit is difficult to access or unavailable in time, borrowers may turn to informal lending channels that often involve higher costs and greater risks.

Alongside expanding access to credit, Agribank also places emphasis on maintaining credit quality. By the end of July 2026, the non-performing loan ratio for loans extended through lending groups stood at approximately 0.4%. This reflects the effectiveness of combining wider credit access with sound risk management, supported by a better understanding of borrowers’ needs, closer assistance during the use of funds and stronger accountability throughout the lending process.

Access to bank credit also helps rural customers become more familiar with formal financial practices, including loan agreements, repayment schedules, bank accounts and transparent financial procedures. In this way, a credit relationship can become an entry point for customers to access additional financial services that better match their needs.

Behind tens of thousands of lending groups and hundreds of thousands of members are individual production plans, business activities and household livelihoods. By bringing formal credit closer to rural communities, Agribank continues to support household production, income improvement and greater financial self-reliance across rural areas.

Kylie Nguyen