Green credit is bank lending for projects or activities that deliver environmental benefits, such as renewable energy, energy efficiency, waste treatment and clean transport. To be classified as green, a project must meet the criteria of the green taxonomy and have evidence of its environmental benefits.
Key takeaways
- Vietnam has issued regulations on environmental criteria and the certification of projects under the green taxonomy.
- Banks are increasingly integrating environmental and social risk management into their lending processes.
- A strong application includes: a quantified description of environmental benefits, emissions data, environmental compliance and an independent ESG assessment.
How do banks assess green projects?
- Check against the taxonomy: whether the activity is included in the green taxonomy.
- Technical criteria: whether the project meets the prescribed environmental thresholds.
- Do no significant harm to other environmental objectives.
- Legal compliance on environment, labour and safety.
- Post-disbursement monitoring: periodic reporting on environmental results.
The documents a business should prepare
| Item | Content |
|---|---|
| Environmental benefits | Emissions reduced, energy saved, waste treated — with a calculation method |
| Baseline data | Greenhouse gas inventory, energy and water consumption |
| Compliance | Environmental permits, monitoring, no violations |
| ESG governance | Policies, responsibilities, independent ESG rating results |
Banks are not trying to make life hard for businesses — they lack reliable data to prove that a loan is green.
Which projects usually qualify?
- Rooftop solar and renewable energy.
- Replacement with high-efficiency equipment and energy saving.
- Wastewater and waste treatment, recycling.
- Certified green buildings and sustainable agriculture.
Frequently asked questions
Does green credit have lower interest rates?
There may be incentives depending on each bank's programmes and policies; beyond interest rates, the benefit also lies in access to long-term funding dedicated to green projects.
Can small businesses get green loans?
Yes, especially for small-scale energy efficiency and renewable energy projects; the key factor is documentation that clearly demonstrates the environmental benefits.
How does an ESG assessment help when borrowing?
An independent assessment gives the bank structured evidence of the business's environmental and social risk management, helping to shorten the appraisal process.
VietESG — Independent ESG rating organisation. Ratings based on disclosed data, supporting evidence and a public methodology aligned with GRI and the SDGs.
