The State Bank of Vietnam (SBV) will implement a credit package of VND120 trillion ($5 billion) for the development of social housing projects with preferential interest rates, according to SBV Deputy Governor Pham Thanh Ha.

The interest rate will be 1.2-2 percentage points lower than the normal interest rate on commercial bank loans, he told a press briefing about the government’s regular meeting on March 3.

Four banks - Vietcombank, Agribank, BIDV, and VietinBank - have agreed to join the program. Each will allocate VND30 trillion ($1.25 billion) for building social housing and houses for workers.

At a national conference on promoting the development of the real estate sector in a healthy and sustainable manner, held last month, the Ministry of Construction proposed the credit package be introduced in order to boost the growth of social housing and houses for workers.

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.