Preferential loans – “Leverage” to help farmers develop their economy

– Over the last time, capital support has been identified as one of the most effective solutions to help farmer members (FMs) increase their sustainable economic growth. It can be considered as a “bridge” to help farmer associations at all levels in the province to receive bank entrustment to provide their members with loans. Since the loans are being used for the right purposes, the concessional loan is really “leverage” to help FMs develop effective economic models, increase their incomes, and improve their living standards.

Mr. Vu Xuan Vung’s family, a farmer from Lang Don village, Chi Lang commune, Chi Lang district received a loan of VND 50 million from the District Bank for Social Policies (Social Policy) for economic development. Mr. Vung said: In 2019, with the support of the Commune People’s Committee, I was able to borrow VND 50 million from the District Bank for Social Policy. Then, I invested the money in buying fertilizers to take care of nearly 500 custard apple trees in my family and planted about 300 new custard-apple trees. Up to now, the trees have grown well with the higher output, bringing me more than 150 million VND/year after deducting expenses. It is estimated that many farmers’ households have been facilitated to borrow loans from banks’ concessional loans for economic growth.

Mr. Hoang Van Ngon, Chairman of the provincial People’s Committee said: Having understood that providing capital for farmers is an effective solution to help them improve their economic conditions, in recent years, provincial People’s Committees at all level in the whole province have worked as a bridge between farmers and the banks, receiving bank entrustment from the Bank for Social Policy and the Bank for Agriculture and Rural Development (Agriculture and Rural Development) to help farmers access the preferential loans.

Farmers in Xuat Le commune, Cao Loc district increase their economic growth with loans from the District Bank for Social Policies

Accordingly, farmers’ associations actively propagate and disseminate to their members the Party’s guidelines and the State’s policies on preferential programs. At the same time, from 2020 to now, associations at all levels have coordinated to organize more than 500 training courses on loan management; transferring science and technology to apply in production and improving the efficiency of capital… for nearly 30,000 farmers. In particular, in order to supply preferential loans to the right people, associations at all levels require their savings and loan groups (Accounting & Loan) to closely coordinate with banks to implement the lending process in accordance with publicity and democracy, perform the loan review and appraisal of the loan’s purpose of use, the ability to repay the capital, and avoid misuse or arising overdue debts… In addition, the associations regularly cooperate with the banks to inspect and supervise the use of loans by members. For example, in the first 6 months of 2021, the People’s Committees at all levels have coordinated to inspect 71 savings and loan groups with a total number of 300 borrowers.  It is recorded that that all savings and loan groups operate in accordance with the law; capital have been used for the right purposes; interest and deposit are paid regularly.

Up to now, all levels of the People’s Committees of the province have received entrustment from the Bank for Social Policy with a total outstanding loan of more than 800 billion VND/18,000 households, outstanding loans with the Bank of Agriculture and Rural Development of more than 67 billion VND/800 households. From the preferential capital, many families are able to reduce poverty and develop their economy with suitable models contributing to the poverty reduction rate in the whole province in 2020 of 7.89% (decreased by 3% compared to 2019).

Many more effective farming economic models are shown in the province recently, for example: Mr. Le The Tan’s household, Lien Phuong village, Dong Tien commune, Huu Lung district with the model of raising chicken and afforestation with an income from 300 to 400 million VND/year; Mr. Nguyen Van Lang’s household, Quan Bau village, Chi Lang commune, Chi Lang district with the model of growing pomelo, custard apples bringing an income of approximately 200 million VND/year… The number of good production and business households at all levels has continuously increased over the years. It is estimated that from 2018 to now, the whole province has more than 31,200 turns of farmers achieving the title of good production and business at all levels (an increase of more than 6,500 households compared to the period 2013 – 2017).

“In recent years, there are many positive changes in trusteeship with farmers’ association at all levels.  To be specific, the direction and management have been smooth from the province to the grassroot levels. Every year, the targets and plans in cooperation with the bank are completed with high results allowing farmers to have opportunity to access the preferential capital to develop production more efficiently.” Mr. Pham Manh Ha, Deputy Director of the Provincial Bank for Social Policy