After promotional periods ended, floating car loan rates in Vietnam rose to 17–18% a year. In some cases, the rate approached 20%.
Minh Phu, a resident of Khanh Hoa province, borrowed nearly VND500 million from VPBank three years ago to buy a car for passenger transport work. The loan runs for eight years, with about VND300 million outstanding. From October 1, the rate rose from 14.8% to 16.8% a year, and his monthly principal and interest payment is VND9 million.
Another customer of the same bank said the rate rose from 16.4% to 18.3% a year after the promotional period ended. With VND500 million still outstanding, the monthly principal and interest payment exceeds VND13 million.
Under some loan contracts, declining vehicle body insurance through the bank adds three percentage points to the rate. A VnExpress survey found floating rates at other private banks generally range from 14% to 15% a year, while Shinhan Bank’s rate is around 12%.
For new loans, banks offer lower initial rates. TPBank lists fixed first-year rates of about 9.2–10.5%, VIB offers 9–9.5%, and Lotte Finance offers 9–9.4% for the first 12 months or 9.2–9.7% with a two-year fixed period.
At the beginning of October, about one third of banks offered deposit rates of at least 9% a year. State Bank of Vietnam data cited by VnExpress put the average lending rate in August at 8.4–10.7% a year, 0.2 percentage points above July.
Financial consultant Do Thu Hong advises borrowers to review their contracts, discuss their situation with their bank, compare refinancing options and repay part of the principal early if possible. Car buyers should calculate the payment after the loan becomes floating, including insurance, linked products and early repayment fees.
Sources: VnExpress
