The current situations of green credit provision and evidence of its impact on bank competitiveness in Vietnam

Abstract

This study analyses the current status of green credit allocation in Vietnamese banks and its impact on their competitiveness. Utilizing data from 2019 to 2023 and applying a qualitative research approach, the authors assess both the current practices and the associated impacts. The findings indicate that green credit activities in Vietnamese banks have experienced positive growth, but remain modest in scale, primarily focusing on sectors such as renewable energy and green agriculture. This study also finds evidence of a positive correlation between green credit and banks' competitive capacity, particularly among state-owned and publicly listed banks. Based on these results, we propose relevant policy recommendations for banks and regulatory agencies to promote green credit activities, thereby enhancing the competitiveness of Vietnamese banks