Vietnam is entering a new stage of development with the requirement to both maintain high economic growth rates, ensure growth quality, use resources effectively, protect the environment and improve resilience to climate change. Along with participating in many international conventions and agreements on environment, climate and biodiversity, Vietnam is facing the requirement to accelerate the green transition process throughout the economy.
Green transition pressure also comes from export markets, investment partners and global consumers through the increasing application of environmental, climate and sustainable development standards. Mechanisms such as carbon boundary adjustment (CBAM), traceability requirements, electronic product passports and ESG standards are gradually becoming important conditions for businesses to participate in the global supply chain.
However, green transformation is a process that requires very large investment resources. In the context of limited state budget resources, mobilizing social resources, especially capital from the financial - banking sector, is decisive. Green finance, in which green credit plays a central role, is becoming an important tool to lead capital flows into green projects, emission reduction projects, circular economy, clean energy and environmental protection activities.
1. Current situation of policies and laws on green credit in Vietnam
In recent years, Vietnam has formed a relatively important policy platform for green credit development.
First, at the national strategic level, the National Strategy on Green Growth for the period 2021 - 2030, vision to 2050 identifies the goal of promoting economic restructuring associated with innovation in the growth model, towards a green, carbon neutral economy and contributing to efforts to limit global warming. The National Action Plan on Green Growth and commitments to achieve "zero" net emissions by 2050 create a political basis and macro orientation for green financial development.
Second, the 2020 Law on Environmental Protection has laid the legal foundation for green credit. The 2014 Law on Environmental Protection only mentions green credit in Article 6, which stipulates "encouraging environmental protection activities", and there are no specific sanctioning regulations. The 2020 Law on Environmental Protection for the first time introduced 01 separate Article on "Green Credit" in Article 149.
Following that, Decree No. 08/2022/ND-CP dated January 10, 2022 of the Government detailing a number of articles of the Law on Environmental Protection provided specific guidance on Article 149 of the Law in Articles 154, 155 and 156.
In particular, the Decree has stipulated "green credit incentive mechanisms" and "green credit implementation roadmap". It can be said that the institutionalization of green credit regulations is an important step, bringing green credit from policies and orientations to legal frameworks. In which, the Decree assigned the Ministry of Agriculture and Environment the task of "issuing environmental criteria and certification for projects granted green credit, issuing green bonds (Green classification list)"; The State Bank of Vietnam and the Ministry of Finance have the task of deploying the green credit implementation roadmap in Vietnam.
Third, the banking industry has issued many documents orienting the development of green banking and green credit. The State Bank has issued action plans to implement green growth in the banking industry, requiring credit institutions to integrate environmental and social risk management into lending activities. In 2024, Decision No. 1663/QD-NHNN amended and supplemented the Green Banking Development Project, expanding requirements for credit institutions and promoting access to green capital for green projects. By 2025, the State Bank has also announced the Handbook on environmental and social risk management systems in credit granting activities, thereby supporting banks to standardize appraisal processes.
Fourth, a notable recent step is the issuance of Decision No. 21/2025/QD-TTg dated July 4, 2025 of the Prime Minister on environmental criteria and the confirmation of investment projects belonging to the green classification list. This decision was first issued in Vietnam, but initially created an important legal basis to determine projects that meet environmental criteria and belong to the green classification list, as a basis for implementing preferential policies, supporting green credit and issuing green bonds. Having a green classification list helps create general unity, reduce the situation of lack of unity in identifying green projects, thereby creating more favorable conditions for banks, businesses and investors.
In particular, the strong development orientation of the private economic sector according to Resolution No. 68-NQ/TW dated May 4, 2025 of the Politburo and the Central Executive Committee set a target of green economy proportion to GDP reaching 10% by 2030, which has opened up important opportunities to mobilize social resources for green projects, circular projects and green transformation of enterprises.
2. The current situation of green credit and some issues to be concerned about
According to some reports, by the end of 2025, there were 63 credit institutions generating green credit balances with a total outstanding balance of more than 780 trillion VND, accounting for about 4.2% of the total outstanding balance of the economy. However, capital sources are still mainly concentrated in the fields of renewable energy, clean energy and green agriculture; while many fields with large green transformation needs have not yet accessed corresponding capital sources.
Although important initial results have been achieved, especially in building and perfecting the policy and legal framework, green credit in Vietnam has not yet developed commensurate with the green transformation needs of the economy. From an environmental management perspective, some main shortcomings and limitations can be identified as follows:
First, the awareness and understanding of green credit, green finance, green investment, green projects and green classification are still not really consistent between management agencies, credit institutions, businesses and investors. This leads to differences in the process of policy making as well as implementation in practice. Many businesses, especially small and medium-sized enterprises, do not have enough information, technical capacity and resources to access the requirements related to green projects or ESG standards.
Second, although the legal framework for green credit has been gradually formed, it is still scattered in many documents in the fields of environment, finance, banking and investment. The inter-sectoral coordination mechanism in policy making, implementation organization, data sharing and results monitoring is not yet truly synchronized. In particular, the roadmap for implementing green credit according to the provisions of law needs to continue to be concretized to create a unified basis for relevant subjects.
Third, Vietnam's newly issued green classification list needs more time to operate stably and uniformly. Credit institutions, businesses, independent verification organizations and state management agencies still need more detailed technical guidance on methods of identifying, evaluating and verifying green projects. At the same time, the construction of a team of experts and a database to serve appraisal work also needs to be further invested in.
Fourth, the environmental data system serving green credit activities is still lacking and scattered. In fact, green credit not only requires assessing the debt repayment capacity of the project but also requires determining the level of greenhouse gas emission reduction, resource efficiency, adaptability to climate change and other environmental benefits. However, the lack of measurement indices, standardized databases and information sharing mechanisms is increasing the cost of appraisal, monitoring and risk management.
Fifth, the mechanism for monitoring and evaluating environmental efficiency after disbursement is still limited. Meanwhile, this is a particularly important content to ensure that green credit capital is truly used for the right purpose and creates environmental benefits as committed.
Sixth, the risk of "greenwashing" (greenwashing) still exists as the demand for access to preferential capital sources, green credit and green finance is increasing. If there is no appropriate mechanism for confirmation, monitoring and information disclosure, the situation where projects are not really green but still have access to preferential mechanisms may affect market confidence and reduce policy effectiveness.
Overall, the above limitations show that Vietnam's current challenges lie in organizing the implementation and effective operation of the policy system and forming a synchronous, transparent and measurable green credit ecosystem.
3. Continue to improve environmental policies and laws to support and promote green credit
To support the effective and sustainable development of green credit, unlock resources for the green transformation and green economic development of Vietnam, it requires the participation and close coordination mechanism between all relevant parties such as banks, finance, environment and specialized sectors. From the perspective of environmental management, the Ministry of Agriculture and Environment has been, is and will closely coordinate with relevant agencies and organizations to continue to promote a number of key tasks and solutions as follows:
- Continue to research and improve the political basis for green credit and green finance development through summarizing and evaluating the results of implementing Resolution No. 24-NQ/TW dated June 3, 2013 of the 11th Party Central Committee and building and submitting to the Central Government for promulgation a new Resolution on environmental protection and response to climate change. In which, the contents on green investment, green projects, green credit and green finance need to be identified as one of the key orientations and tasks to mobilize resources for sustainable development.
- Organize the effective implementation of tasks and solutions on green economic development, circular economy, and green growth assigned in documents of the Party, National Assembly and Government; and at the same time continue to review and improve policies and laws to create a favorable environment for mobilizing and allocating financial resources to serve the green transformation process associated with the goal of rapid and sustainable economic growth in the period 2026 - 2030.
- Continue to improve the legal system on environmental protection in the direction of strengthening mechanisms to encourage green investment, circular economy development, sustainable production and consumption. In which, focus on completing the draft Law amending and supplementing a number of articles of the Law on Environmental Protection and comprehensively amending Decree No. 08/2022/ND-CP, ensuring synchronization and unity of regulations on green projects, circular projects and tools to support green credit and green finance development.
- Complete and submit to the Prime Minister for promulgation a Decision guiding the identification of green projects, projects that meet the criteria of circular economy and apply the framework of environmental, social and governance standards (ESG), thereby creating a basis for implementing support mechanisms according to the provisions of Resolution No. 68-NQ/TW, Resolution No. 198/2025/QH15 and government resolutions on private economic development, contributing to promoting businesses to access green credit capital sources and state support policies.
- Continue to review, update and improve regulations on environmental criteria, green classification and confirmation of investment projects belonging to the green classification list; and at the same time strengthen coordination with ministries, branches, localities, credit institutions and related parties to guide, support and improve the effectiveness of implementing regulations on green classification nationwide.
4. Proposing to relevant agencies and organizations to improve policies and laws on green credit and green finance
Developing green credit and green finance is a new issue, inter-sectoral, inter-field and at the same time contains different opportunities, risks and challenges.
Therefore, the Ministry of Agriculture and Environment continues to review and improve the legal system on environmental protection; and at the same time requests the State Bank of Vietnam, the Ministry of Finance and Ministries and ministerial-level agencies within their state management scope to continue to research, develop and submit to competent authorities for promulgation a specific roadmap for implementing green credit according to the provisions of Article 156 of Decree No. 08/2022/ND-CP; guiding credit institutions and foreign bank branches in Vietnam to integrate regulations on projects meeting environmental criteria and the confirmation of investment projects belonging to the green classification list into credit granting and credit management activities of banks. Specialized ministries and sectors (construction, industry and trade, tourism...) continue to closely coordinate with the Ministry of Agriculture and Environment to review and update projects belonging to the green classification list, ensuring unity, synchronization and meeting the green development needs of each industry and sector. It is necessary to form an inter-sectoral coordination mechanism on green credit and green finance, with the participation of all stakeholders.
In which, the agency managing credit, bonds and finance plays a core role, closely and effectively coordinating with the environmental agency, specialized sectors and localities in policy planning, implementation, monitoring, supervision, evaluation and recommendations to competent authorities...
5. Summary
Green credit and green finance are not only tools to mobilize capital for environmental protection projects but also one of the important driving forces promoting the transformation of the growth model, green economic development, circular economy and improving the competitiveness of the Vietnamese economy in the new context.
In the coming period, for green credit to truly become the main capital flow serving green transformation, it is necessary to continue to synchronously improve institutions, improve implementation capacity, strengthen inter-sectoral coordination and build a transparent and effective monitoring mechanism. The focus is not only on continuing to improve policies but also on bringing the promulgated policies into life, creating conditions for credit institutions to boldly provide capital, businesses to easily access green capital sources, and green projects to be widely implemented in practice. Only then will green credit truly become an important driving force contributing to the implementation of sustainable development goals, green growth, and Vietnam's commitment to net zero emissions by 2050.
