Agribank - A Strategic gateway for Vietnam’s carbon credits to global market

Carbon credits are emerging as a valuable form of “green asset.” However, to unlock their full potential and turn it into tangible value, Vietnamese businesses require strong financial backing, technical expertise, and market linkages.

As a leading state-owned bank driving investment in agriculture and rural development, Agribank is strengthening its pioneering role, not only by providing capital but also by paving the way for Vietnamese carbon credits to access international markets.

From biomass credits to carbon opportunities

Vietnam has become the first country in the East Asia-Pacific region to secure a $51.5 million results-based payment for verified emission reductions under the World Bank’s Forest Carbon Partnership Facility (FCPF).

The funds have benefited 70,555 forest owners and 1,356 forest-dependent communities across six provinces, distributed under a transparent allocation plan that ensures fairness and broad stakeholder participation.

This milestone highlights how the “intangible asset” of carbon credits can be transformed into a sustainable revenue source for both local communities and the nation as a whole.

With 14.7 million hectares of forests, a tropical climate, and fast tree growth, Vietnam is at a pivotal moment: moving from a country with vast potential to becoming a leading supplier of carbon credits in the region.

However, realizing this vision requires access to long-term, sustainable financing - capital that enables businesses to invest in technology, infrastructure, and rigorous international certification and data transparency standards to be met.

In this context, Agribank has taken a pioneering role in supporting enterprises. Its loan agreements with Van Lang Yufukuya Co., Ltd. and Lam Thanh Hung Co., Ltd. in Thanh Hoa province provide not only financial resources but also the confidence for these businesses to pursue green projects, contributing to building a low-carbon economy.

Located in the Nghi Son Economic Zone, Van Lang Yufukuya specializes in producing woodchips and wood pellets, which are in high demand in Japan, South Korea, and Europe for biomass energy production. Since 2020, Agribank has extended a credit facility of VND200 billion (approximately $8 million), with VND161 billion disbursed to date.

This timely financing has enabled the company to secure raw material supply chains, maintain export schedules, and invest in market expansion as well as biomass processing line upgrades.

Notably, Van Lang sources exclusively from suppliers certified by the Forest Stewardship Council (FSC) and pays for each shipment directly. This not only meets international transparency and sustainability requirements but also affirms the company’s long-term commitment to global standards.

Unlike Van Lang, Lam Thanh Hung Co., Ltd., headquartered in Tuong Linh commune, focuses on woodchip and laminated board production. Backed by Agribank with an VND80 billion ($3.03 million) credit facility (fully disbursed), the company has scaled operations and improved competitiveness in international markets.

Lam Thanh Hung also manages 700 hectares of forest across four communes - Cong Liem, Cong Chinh, Tuong Son, and Tuong Linh - leasing land from 258 households.

The company fully honors lease payments and compensates local households directly for raw material purchases. This model ensures a stable supply chain, generates local income, and establishes a fair benefit-sharing mechanism - an essential element of sustainable development.

At first glance, these credit facilities may appear as traditional forestry loans. In reality, they are critical links in the carbon value chain. From tree planting to biomass processing and export, each activity contributes to measurable, reportable, and verifiable (MRV) emission reductions. Once certified to international standards, these reductions can be transformed into carbon credits, tradable on voluntary and compliance markets.

Agribank’s financing is more than just a source of capital - it provides leverage, empowering Vietnamese businesses to step onto the multi-billion-dollar global carbon market. This showcases how a commercial bank can serve as a “bridge” between the traditional agricultural economy and the emerging green economy.

Lang Van In, chairman of the board of directors of Van Lang Yufukuya Co., Ltd., shared: “The loan from Agribank has been key to investing in biomass processing and afforestation projects. Despite favorable policies under Decree 06/2022/NĐ-CP and Decision 888/QD-TTg, we face major challenges: high MRV (monitoring, reporting, and verification) costs, complex certification processes, and strict data transparency demands. Without Agribank’s support, we could not have come this far.”

Agribank’s financing is more than just working capital; it serves as a stepping stone for businesses to thrive in the green economy, where value lies not only in wood products but also in quantified emission reductions. Biomass loan facilities now act as gateways for Vietnamese enterprises to monetize carbon credits - an asset once considered intangible, now increasingly recognized as high-value.

Lam Thanh Hung representatives echoed this sentiment: “Access to financing has allowed us to sustain forest-to-processing operations and explore lucrative carbon credit markets in Japan, the EU, and South Korea. We believe carbon credits will become a sustainable revenue source alongside wood products, building a strong financial foundation.”

A “Vote of confidence” for Vietnam’s position in the global carbon value chain

Agribank’s timely financing has empowered companies to meet international standards, maintain production continuity, and build credibility with global partners.

With this backing, not only Van Lang and Lam Thanh Hung but also Vietnam’s forestry enterprises are expanding their presence - not only in traditional export markets but also in the $900 billion (2024) and rapidly growing international carbon market.

While businesses “generate” carbon credits, banks act as the “gateway” to bring these products to market. As Vietnam’s leading agricultural bank, Agribank fully recognizes the immense carbon potential of Vietnamese forests within the global carbon value chain.

By financing these enterprises, Agribank is not only promoting clean production but also directly supporting Vietnam’s Net Zero 2050 commitments. This positions Agribank to diversify its credit portfolio into carbon finance - a high-growth sector offering new revenue streams from service fees, guarantees, and cross-border transactions, while reinforcing its reputation as a sustainable, green financial institution.

As businesses build stable income streams from carbon credits, banks benefit from strengthened repayment capacity, reducing credit risk. This “win-win” dynamic enables Agribank to fulfill its social responsibility while enhancing its competitive edge in financial markets.

Beyond financing, carbon projects require advanced MRV systems, digitized data, and transparency. This creates opportunities for Agribank to accelerate its digital transformation strategy and deliver cross-border payment solutions, cash flow management services, and innovative digital banking offerings. Green loans thus serve as gateways to modern financial services, forging stronger connections between enterprises and banks.

Buyers of these credits are also expressing growing confidence in Vietnam’s market offerings. One buyer noted: “The credits we purchase from Vietnamese enterprises fully meet legal, technical, and environmental integrity requirements. These are high-quality credits that can be resold or retired to fulfill compliance commitments. More importantly, they enhance the reputations of both sellers and buyers in global markets.”

This demonstrates that not only businesses and banks benefit, but Vietnam’s efforts are also internationally recognized. Each successful transaction is a “vote of confidence,” reinforcing Vietnam’s position in the global carbon value chain.

The international carbon market is opening a gateway for the green economy, but only capable players can take off. As Vietnam’s largest state-owned commercial bank with a nationwide network, Agribank serves as a strategic bridge, connecting Vietnamese carbon credits with global opportunities.

This journey requires more than capital - it demands technology, governance, and, above all, strategic vision. With its ESG commitments and mission as a “Bank for the Community,” Agribank proves that green finance is not a slogan but a concrete action agenda - empowering businesses, advancing Vietnam’s Net Zero 2050 commitments, and securing the country’s place on the global carbon map.