This study investigates the relationship among credit expansion, macroeconomic stability, and green growth taking Vietnam as a case study. Vietnam being a transition economy is quite unique in this aspect as it boasts of a credit-to-GDP ratio that is among the high-est globally. To carry out the assessment on credit impact over sustainable development, we apply ARDL, NARDL and threshold regression approaches using quarterly data of 2010Q1–2024Q4. The findings suggest that credit expansion is boosting short-term economic performance, but has no stabilizing impact in the long run. A significant threshold is found to be around 123% of GDP, above which no more growth in the economy will result from credit, while macroeconomic variables like ex-change rates and interest rates will find their equilibrium level. These findings support the “Too Much Finance” notion that excessive lending and borrowing might stagnate the movement towards sustainability in heavily indebted situa-tions. The research emphasizes the need to shift credits from fossil fuels and non-green sectors to renewables, green infrastructure, and high-tech industries as a support for Vietnam's commitment to achieving net-zero emissions by 2050 along with a green growth agenda. It also suggests policies that prioritize credit quality over quantity, diversify funding sources beyond traditional bank lending, and integrate sustainability standards into credit allocation. By linking credit dynamics with environmental greening in this study, financial growth can be enhanced and emerging economies can learn valuable lessons on how to balance financial expansion with environmental commitments.