HÀ NỘI — From carbon emissions to product traceability, global markets are placing unprecedented pressure on agricultural exporters to go green. In Việt Nam, experts believe the next transformation of farming will not be driven by seeds or machinery alone, but by a fundamental shift in how capital flows into the agricultural economy.

According to Nguyễn Quang Huy, head of the Faculty of Finance and Banking at Nguyễn Trãi University, major export markets are increasingly enforcing stricter standards on environmental protection, carbon emissions and traceability. 

As a result, green transformation is no longer optional but is gradually becoming a prerequisite for agricultural products seeking deeper access to international markets.

In this transition, green credit is viewed as a critical tool for reshaping production models and enhancing the competitiveness of Việt Nam’s agricultural sector.

Statistics show that by early this year, outstanding loans for agriculture and rural development reached approximately VNĐ4.2 quadrillion, up more than 14 per cent compared to the previous year. This accounted for over 22 per cent of total outstanding credit in the economy and directly supported more than 14.6 million customers nationwide.

In 2025 alone, agricultural credit exceeded VNĐ4 quadrillion, representing 23-25 per cent of total outstanding loans across the economy. However, most lending still relied on traditional collateral-based models.

Meanwhile, green loans by the end of 2025 reached between VNĐ780 trillion and VNĐ850 trillion, but only slightly more than 3 per cent was allocated to the agriculture sector, agricultural products and fisheries.

Green shift

Huy noted that the government had taken an important step by issuing Decision 21 in July 2025 on environmental criteria and the certification of projects classified as green. This marked the first formal foundation for developing green credit in a more systematic manner.

Nevertheless, implementation remains fragmented due to the absence of a unified green standards framework across the banking system, according to Huy. Each financial institution currently applies different assessment criteria, making it difficult for businesses to access capital and creating inconsistencies in project evaluation.

At the same time, the current credit model reveals significant limitations. Capital flows are still mainly directed toward individual small-scale farming households, while green and digital agriculture require close integration along value chains. This weakens capital efficiency and hinders the development of large-scale production zones.

Another major challenge lies in the lack of agricultural data. Existing data remains fragmented and incomplete, while the credit system for green and digital agriculture require transparent information, traceability, and real-time risk monitoring to function effectively.

The difficulties are not limited to farmers. Many enterprises and cooperatives also lack the capacity to meet green transition requirements. 

Businesses still face shortcomings in standards on environmental, social, and governance (ESG) practices, while cooperatives struggle with governance issues, and many farmers lack digital skills and access to technology.

 

Structural barriers

Experts warn that without simultaneously addressing barriers related to data infrastructure, production linkages and credit mechanisms, the transition toward green and digital agriculture will proceed far more slowly than expected.

According to Huy, the challenge is no longer simply about expanding lending quotas or lowering interest rates. Instead, it requires rebuilding the entire agricultural ecosystem – from capital flows and data systems to technology and institutional frameworks.

In particular, financing must shift away from lending for isolated projects toward value-chain-based financing. This means banks should evaluate not only individual producers but the entire chain, from production and processing to distribution and consumption.

When credit is tied to value chains, quality control, traceability and compliance with green standards become significantly more effective.

Alongside policies promoting land consolidation and large-scale farming models, Huy emphasised the urgent need to build a digital agricultural data ecosystem integrating production data, environmental information and traceability systems. Such a platform would form a large-scale data infrastructure to support governance and credit allocation.

At the same time, expanding knowledge and training in agricultural digitalisation would be essential to help farmers, cooperatives, and businesses improve digital capabilities. This is considered a crucial condition for green and digital credit to develop effectively, instead of continuing to rely heavily on physical collateral.

Chain financing

Nguyễn Văn Long, chairman and CEO of Nhật Long JSC, agreed that rather than providing isolated loans, banks should assess the entire production-to-consumption chain when determining repayment capacity.

For enterprises, the greatest advantage is more stable and flexible access to capital. When enterprises have linkage contracts and secured market outlets, banks are more likely to view projects as feasible and less risky. This allows businesses to confidently invest in the development of seeds, agricultural inputs, production technology, processing and logistics.

When financing is integrated into production chains, enterprises have better condition to scale up and improve operational efficiency.

In addition, enterprises can establish traceability systems, production standards and stricter quality-control mechanisms, to meet market requirements and improve competitiveness.

However, businesses must possess strong governance capacity to manage the entire chain effectively. A disruption in any stage could create ripple effects throughout the system. 

To make value-chain financing effective, all sides need coordination in action. Enterprises must improve financial transparency, strengthen governance, and adopt technology in production and traceability. 

Credit institutions, meanwhile, must modernise their appraisal methods and participate more deeply in agricultural value chains.

Huy also stressed that the government should soon establish a unified green credit framework for the banking sector, while introducing support mechanisms to help businesses obtain green certifications and gain access to sustainable export markets.

At the same time, the development of green credit guarantee funds and agricultural insurance mechanisms would help reduce risks for both banks and borrowers. — VNS