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 Three Emerging Currents Shaping Vietnam's Automotive Finance Future

• The Rise of Used Car Financing: The narrative is no longer solely about new cars. A significant trend is the growing formalization and demand for used car financing. In 2024, over 67% of used car buyers opted for financing solutions, enabling access to better quality pre-owned vehicles. Banks like VP Bank and TP Bank are becoming prominent in this segment. This shift is driven by affordability concerns and the value proposition of certified pre-owned programs, creating a vital new revenue stream for lenders who can develop robust valuation and risk models for second-hand assets.
• Flexible Mobility and Subscription Models: Beyond traditional ownership, new models are gaining traction in the automotive financing market. Vehicle subscription and long-term rental services are emerging as a key trend, particularly in urban centers. While still nascent, the car rental market, a precursor to subscriptions, is valued at US$ 0.77 Billion in 2025 and is projected to grow. Companies like Xanh SM Rentals are pioneering electric vehicle rental and subscription packages, attracting customers with flexibility and no long-term commitment, pushing traditional financiers to innovate beyond standard loan products.
• Embedded Finance and Digital Ecosystems: The point of sale is becoming the point of finance. A major trend is the integration of financing directly into online car purchasing platforms and dealership management systems. Digital sales accounted for 28% of all used car transactions in 2024, with platforms like Bonbanh.com facilitating 150,000 transactions. Lenders are partnering with these digital marketplaces to offer instant, embedded loan approvals at the moment of consideration, making the process seamless and capturing customers earlier in their buying journey.

The Surging Demand for Commercial Vehicle Financing Driven by Industrial Growth

A powerful driver for the Vietnam automotive financing market is the booming commercial vehicle segment. Demand here is not just about individual mobility; it is about fueling the nation's economic engine. Massive infrastructure development is a key catalyst. Vietnam's public investment disbursement target for 2025 is a colossal 700 trillion VND. Furthermore, investment in just 5 key national transport projects in 2024 surpassed 100 trillion VND. Construction on the critical North-South Expressway eastern section alone requires over 5,000 heavy vehicles and machinery during the 2024-2025 period. All these projects create an insatiable need for trucks, buses, and specialized machinery, all of which require financing.

The logistics and transportation sectors are expanding in parallel. The number of registered transport businesses in Vietnam automotive financing market grew by over 8,000 in 2024, each a potential client for financiers. Vehicle sales figures reflect this reality. Leading manufacturer Thaco Commercial sold over 15,000 trucks and buses in the first three quarters of 2024. Light Commercial Vehicle (LCV) sales also saw a significant jump, with over 35,000 units sold across all brands in the first half of 2025. Hino Motors Vietnam has set an ambitious sales target of 4,000 units for 2025. Lenders are responding with tailored products. Specialized lenders like HDBank now offer commercial vehicle loans of up to 10 billion VND per vehicle, while the average loan tenure for a new medium-duty truck in 2024 stabilized at 60 months, reflecting industry confidence.

Fintech Integration and Digital Platforms Revolutionize Consumer Access to Loans

Today, demand in the Vietnam automotive financing market is increasingly shaped by the expectation of speed, convenience, and seamless integration. Vietnam's population is rapidly adopting digital finance. The number of active mobile banking users is projected to surge to 70 million by early 2025. A burgeoning fintech ecosystem, with over 200 active companies as of early 2025, is accelerating innovation. Digital payment transaction volume via QR codes surpassed 100 million transactions per month in late 2024, normalizing digital financial interactions for consumers. Leading digital-first banks like Cake by VPBank aim to acquire 2 million new customers in 2025, many of whom will expect digital lending options.

Financial institutions across Vietnam automotive financing market are leveraging technology to meet a new standard of demand. At least 10 major banks have launched fully digital car loan application portals as of the first quarter of 2025. The impact on efficiency is stark; the average time for a digital loan pre-approval via mobile apps dropped to under 15 minutes in 2025. Banks are also opening up their infrastructure. VIB reported over 500 million API calls through its open banking platform in 2024, enabling partnerships with digital marketplaces. Advanced tech like AI is being deployed; FPT.AI rolled out its credit scoring solution to 5 major Vietnamese banks in 2024. Even physical banking is evolving, with TPBank’s LiveBank+ digital branches processing over 3 million transactions in 2024, including loan inquiries

 Segmental Analysis 

Loans Spearhead Dominance in the Vietnam Automotive Financing Market

The overwhelming preference for loans, which command a significant 57.12% share in the Vietnam automotive financing market, is a clear indicator of consumer priorities and the existing financial landscape. This inclination is largely driven by a deep-seated desire for outright ownership, a cultural trait that views vehicles as long-term assets. The pride and sense of security that come with holding the vehicle's registration papers are paramount to Vietnamese consumers. Financial institutions have adeptly responded to this preference by offering a plethora of loan products with attractive features. The average loan-to-value (LTV) ratio for auto finance stands at a generous 70%, compelling buyers to arrange a manageable 30% upfront payment. Furthermore, the market is witnessing a surge in flexible repayment options, with 70% of new auto loan offerings in 2024 including features like balloon payments and deferred EMIs for up to six months, making loans an even more appealing proposition.

The structure of the lending ecosystem further solidifies the dominance of loans. The simplicity and familiarity of loan products, coupled with aggressive marketing by banks, have made them the go-to option for aspiring vehicle owners. The entire process, from application to disbursement, is becoming increasingly streamlined, with some banks promising credit notifications in as little as four hours. This efficiency, combined with competitive interest rates that have been on a downward trend since late 2023, creates a powerful incentive for consumers to opt for loans over leases. The focus of financial literacy campaigns has also been predominantly on responsible borrowing through loans, further cementing their position in the vibrant Vietnam automotive financing market.

• A notable 25% increase in financing approvals for electric vehicles was seen in 2023.
• The average turnaround time for loan applications has been drastically reduced from 7 days to under 48 hours.
• By 2029, it is anticipated that 70% of auto loans will be processed through online platforms.

Midterm Durations The Sweet Spot for Borrowers in Vietnam

Borrowers in Vietnam automotive financing market exhibit a strong preference for midterm loan durations, which consequently dominate the market with a 53.42% share. This choice reflects a pragmatic approach to financial management, balancing the affordability of monthly payments with the total interest paid over the loan's life. A midterm tenure, typically ranging from three to five years, offers a comfortable equilibrium for the burgeoning middle class, which is projected to constitute over 26% of the population by 2026. These consumers are often first-time car buyers who are cautious about long-term financial commitments. A shorter loan term, while having higher monthly installments, is often perceived as a faster route to debt-free ownership.

The appeal of midterm loans is further enhanced by the policies of financial institutions. Many banks offer more favorable interest rates and processing fee waivers for loans with a midterm repayment schedule to attract a larger pool of creditworthy borrowers. For instance, some leading banks offer car loan interest rates ranging from 6.5% to 9% per year during the incentive period for such tenures. This strategic pricing makes midterm loans financially more advantageous in the long run. The psychological comfort of clearing a significant debt within a reasonable timeframe, without the prolonged financial strain of a long-term loan, is a powerful motivator for consumers navigating the dynamic Vietnam automotive financing market.

• Loan tenures for two-wheelers are considerably shorter, often ranging from 6 to 36 months.
• Some banks provide loan periods of up to 84 months for new cars.
• Motorcycle loan interest rates can vary significantly, from 0% to 2.92% per month.

Two-Wheelers Reign Supreme in the Automotive Financing Arena

The staggering 70.89% share of two-wheelers in the automotive financing market underscores their indispensable role in Vietnam's transportation ecosystem. With over 77 million registered motorcycles as of September 2024, the ownership rate of 770 motorcycles per 1,000 people is among the highest globally. This ubiquity is a direct consequence of their affordability, maneuverability in congested urban areas, and low running costs. The financing for two-wheelers is characterized by smaller loan amounts, typically ranging from 20 million to 100 million VND, and shorter repayment tenures. This makes them accessible to a vast segment of the population, including students and low-income individuals.

Financial institutions have developed highly streamlined and often instant loan approval processes for two-wheelers, facilitated by the proliferation of digital lending platforms. In 2023, a significant portion of these loans were processed through such channels, highlighting the digital-first approach in this segment. The documentation required is minimal, often just an ID card and residence confirmation, which further expedites the process. Major motorcycle manufacturers have also established their own captive finance arms or have tie-ups with financial institutions to offer attractive financing schemes with low or even zero percent interest rates for certain models, making the purchase decision almost seamless for the end consumer and reinforcing the strength of the Vietnam automotive financing market.

• Motorcycle sales in the first quarter of 2024 reached 603,745 units.
• The under-50cc scooter segment witnessed a significant sales decline of 28.4%.
• Honda holds a commanding 82.5% market share in the two-wheeler segment.

Private Vehicle Financing Reflects a Growing Aspirational Vietnam

The fact that over 62.34% of automotive financing is directed towards private vehicles is a testament to the rising aspirations and improving economic conditions of the Vietnamese populace. A private vehicle, particularly a car, is increasingly viewed as a status symbol and a reflection of personal success further favoring the growth of the automotive financing market. The country's vehicle penetration rate, which currently stands at 34 vehicles per 1,000 inhabitants, is on an upward trajectory. This demand is further fueled by the desire for enhanced comfort, safety, and convenience, especially for families. The government's push to improve road infrastructure has also made car ownership a more viable and attractive proposition.

The financial sector has been quick to cater to this burgeoning demand with a wide array of loan products specifically designed for private vehicle buyers. The competitive landscape among lenders has led to attractive offerings, including longer loan tenures of up to 84 months and high loan-to-value ratios, making car ownership more accessible than ever before. The rise of ride-hailing services has, counter-intuitively, also contributed to this trend by exposing more people to the comfort of car travel, thereby creating a desire for personal ownership. This segment of the Vietnam automotive financing market is expected to witness sustained growth as disposable incomes continue to rise.

• 48% of respondents in a recent survey do not own a car, indicating significant growth potential.
• Ride-hailing services are used several times a week by 47% of the population.
• The passenger car segment of the ride-hailing market holds a 61% market share.

Banks Firmly in the Driver's Seat of Automotive Financing

Banks' commanding 82.42% share of the Vietnam automotive financing market is a result of their long-standing presence, extensive branch networks, and the high level of trust they command among consumers. Leading institutions like VIB Bank, TP Bank, and BIDV have established themselves as the primary sources for vehicle loans. They offer a sense of security and reliability that is crucial for a significant financial decision like purchasing a vehicle. Their ability to offer a comprehensive suite of financial products allows for cross-selling opportunities, further solidifying their customer relationships.

The digital transformation sweeping across the Vietnamese banking sector has further cemented their dominance. Around 45% of all auto loan applications in 2025 are projected to be processed digitally, a trend led by banks. They are increasingly leveraging AI-driven credit scoring and automated loan origination to reduce processing times and enhance the customer experience. While non-banking financial institutions (NBFIs) are making inroads by catering to customers with limited credit history, the sheer scale and resources of banks allow them to offer more competitive interest rates and flexible repayment options, ensuring their continued leadership in the Vietnam automotive financing market.

• VPBank processed over VND 120 trillion in auto loans in 2023.
• Nearly 50% of non-performing loans in the auto finance sector are linked to vehicle pawning.
• Techcombank offers a preferential interest rate of 3% per year for certain car loan products.

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Top 4 Developments in Vietnam Automotive Financing Market

1. BE GROUP's Funding Round to Expand Ride-Hailing Fleet: In early 2024, BE Group raised about $30 million with backing from VPBank Securities aimed at expanding its driver fleet and digital financial services.
2. ADB's Green Loan to VinFast's Charging Infrastructure: ADB mobilized a $135 million financing package in support of VinFast’s fully electric public transport bus fleet and national EV charging network in 2024.
3. Geleximco Group's Investment in a New Automotive Plant: 2024, Geleximco Group announced investment plans for a significant automotive manufacturing plant in Thai Binh province, signaling major industrial expansion.
4. Shinhan Financial's Acquisition of Home Credit Vietnam: Confirmed. SCBX Group (Shinhan affiliate) announced in early 2024 the acquisition of Home Credit Vietnam, expanding its consumer finance and auto loan offering, with transaction expected to finalize in 2024–2025.

Top Companies in the Vietnam Automotive Financing Market

• VIB (Vietnam International Bank)
• Techcombank
• VPBank
• MB Bank
• Toyota Financial Services Vietnam
• Bank for Investment and Development of Vietnam
• Sacombank
• HD Saison Finance Company
• FE Credit
• Other Prominent Players

Market Segmentation Overview:

By Financing

• Leases
  • Operating Lease
  • Finance Lease
• Loans
  • Direct
  • Indirect

By Duration

• Short Term
• Mid Term
• Long Term

By Vehicle Type

• 2- Wheelers
• 3-Wheelers
• 4-Wheelers
  • LCVs
  • HCVs

By Vehicle Usage

• Private Vehicles
• Commercial Vehicles
• Heavy Vehicles

By Propulsion Type

• ICE
• Electric Vehicle

By Ownership

• New Vehicle
• Old Vehicle

By Service Provider

• Banks
• Non-Banking Financial Companies (NBFCs)
• OEM
• Others (Credit Unions)

By End User

• Private/ Individual
• Corporate/ Enterprises