The State Bank of Vietnam (SBV) asked four major banks to begin to disburse a credit package of VND120 trillion ($5 billion) for the development of social housing projects with preferential interest rates from April 1.

Agribank, BIDV, Vietcombank, and Vietinbank had earlier agreed to join the program. Each will allocate VND30 trillion ($1.25 billion) for building social housing and housing for workers.

The interest rate will be 1.5-2 percentage points lower than the normal rate on commercial bank loans.

Investors in social housing projects will be allocated 50 per cent of the package while the remainder will be for personal customers who buy or rent social housing.

Disbursement will take place until the credit packge is fully disbursed, or no later than December 31, 2030.

The Ministry of Construction proposed the credit package in February, in a bid to boost the growth of social housing and housing for workers.