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Deposit interest rates at Vietcombank, Vietinbank, Techcombank, Eximbank, Asia Commercial Bank, Viet Nam Tin Nghia, Sacombank and Ocean Bank range from 10.85-11 per cent.
Banks have begun offering gifts, including Vespas, Honda Civics, Toyota Camries or cash, to attract customers.
"The government has instructed, the State Bank of Viet Nam has directed and the Viet Nam Banks Association has pushes us to cut interest rates. But if it is difficult for us to absorb deposits, then we have to use additional measures," said deputy director of a HCM City-based bank, who asked to remain anonymous.
"The previous higher interest rates could hardly be called deposits. I don't understand how markets will respond to these new lower interest rates."
A senior manager at the Bank for Investment and Development of Viet Nam (BIDV) said: "Cutting deposit interest rates at this moment is not easy for many banks because customers expect high interest rates to combat inflation."
VNBA's General Secretary Duong Thu Huong said that banks were trying hard to lower interest at banks, but interest rates depended on what the government was doing to fight inflation.
The State Bank of Viet Nam reported that deposit interest rates at commercial banks from July to September were down 0.2-0.3 percentage points against the second quarter, ranging from 10.59-11.2.
The central bank will continue managing monetary flexibly, promoting open market operations and will work to refinance and keep interest rates stable to help banks lower interest rates.