International Finance Corporation (IFC) and Vietnam Prosperity Joint Stock Commercial Bank (VPBank) have collaborated to provide supply-chain financing of up to $150 million to Vietnamese coffee exporters, according to an announcement on Friday.
The financing package, equally contributed by VPBank and IFC, marks the first supply-chain co-financing programme between IFC and a local commercial bank in Vietnam. The programme is expected to initially channel direct capital to coffee exporters and later expand to other sectors, thereby enhancing private sector access to the global agricultural supply chain.
VPBank, with its long-standing experience serving SME customers, offers preferential financing packages to coffee SMEs with favourable interest rates and credit conditions.
Meanwhile, IFC will help connect local suppliers and large buyers, including major coffee and agriculture importers with strong financial capacity, extensive networks, and efficient supply-chain management processes.
Additionally, it will advise local suppliers and large buyers on sustainable finance frameworks, sustainable supply-chain financing activities, and trends in green agriculture.
Coffee remains Vietnam’s primary agricultural export, with export turnover exceeding $4 billion in the past two years. The trade finance collaboration between VPBank and IFC is expected to facilitate the working capital needs of coffee enterprises.
In 2022, IFC proposed an investment of up to $75 million in VPBank to help the Vietnamese lender provide supply-chain finance on a portfolio basis. IFC’s loan is part of VPBank’s financing plans of up to $150 million.
Earlier, IFC also extended a $212.5-million financing package for Vietnam-based VPBank to expand the latter’s lending to small and medium enterprises as well as financing for climate-related projects.
