Empowering near-poor households to rise for economic development

– Recently, many near-poor households in the province have had access to preferential loans from the Bank for Social Policies to develop production and increase income. The source of policy credit has made a positive contribution to implementing the sustainable poverty reduction goal, ensuring social security in the province.

Previously, in the area of ​​Bridge 10, Huu Lung township, Huu Lung district, Mrs. Nguyen Thi Boi’s family is a particularly difficult family. Thanks to the policy capital, Mrs. Boi’s family has escaped poverty. Mrs. Boi shared that in 2014, under the guidance of the savings and loan borrowing group, she borrowed 40 million VND from the Bank for Social Policies to invest in a seedling nursery. Thanks to effective investment, by 2019, her family escaped poverty and paid off bank debt. Despite escaping poverty, her family is still a near-poor household, in need of capital to continue investing in economic development, in 2020, she boldly borrowed 40 million VND from the near-poor household program to expand production scale.  Thanks to that, each year, her family supplies from 40,000 to 50,000 seedlings to the market, bringing in an income of nearly 100 million VND; with capital, her family has also invested in planting 0.5 ha of forest.

People made transactions at transaction points in Quoc Khanh commune, Trang Dinh district

Loc Binh district is also a long-term poor household. Thanks to the effective use of policy capital, by 2015 his family had escaped poverty, in 2016 he continued to borrow 50 million VND from the near-poor household loan program to take care of a pine and eucalyptus forest with an area of two hectares​​, at the same time raising pigs, chickens and investing in a milling machine to serve people around the area. Mr. Thuan said that thanks to the timely investment capital and the guidance of the staff of the Commune Farmers’ Association, the bank, his family has an income of nearly 100 million VND/year, in early 2021, he paid money back to the bank and has risen to be well-off.

Mr. Thuan and Mrs. Boi are just two of many cases who have been able to access and effectively use capital from the preferential lending program for near-poor households. Accordingly, the near-poor household lending program has been implemented in the province since 2013 according to the Prime Minister’s Decision No.15/2013/QĐ-TTg on credit for near-poor households in order to support capital for poor households for economic development.

Mr. Pham Manh Ha, Deputy Director of the Provincial Bank for Social Policies said that in order to effectively implement the program, every year, the bank actively advises the Board of Directors of the Provincial Bank for Social Policies, from the beginning of the year, there is a document to direct, assign targets and plans to districts and the city. Accordingly, the bank directs district transaction offices to assign targets to communes and townships; coordinate with trustee associations, People’s Committees of communes, wards, townships, savings and loan borrowing groups to organize implementation, accelerate disbursement and meet people’s borrowing needs.

People in Yen Binh commune, Huu Lung district developed a model of afforestation from concessional loans

outstanding loan program for near-poor households has reached over 478 billion VND, an increase of 40 billion VND compared to December 31, 2020, the total number of households with outstanding loans is 9,520 households. From the beginning of 2021 until now, the bank has disbursed 105 billion VND for 1,662 borrowing households. Especially, since March 2019, the program has increased loans to 100 million VND/household, the loan term has been increased from five years to ten years, the bank has actively propagated to households in need to timely grasp and borrow capital, so far, more than 1,500 households have borrowed from 50 to 100 million VND with a total outstanding loan of over 136 billion VND.

In order for the capital to be effective, in parallel with the disbursement of capital, the Provincial Bank for Social Policies has developed a plan to closely monitor and ensure that the capital goes to right receivers. Through the annual inspection, most of the households have used capital for right purposes and effectively developed economic models such as growing star anise, pine, acacia, eucalyptus; livestock and poultry raising; growing fruit trees and so on. That is reflected in the credit quality, currently the program’s overdue debt ratio accounts for only 0.01% of the total outstanding loans.

The near-poor household lending program has really become a source of support for near-poor households to have conditions to develop their economy, build a stable life and escape poverty sustainably. Thereby, it has contributed to effectively implementing sustainable poverty reduction in the province, by the end of 2020, the poor household rate of the province was 7.88% (in 2018 it was 15.83%); reducing the rate of near-poor households to 9.27% ​​(in 2018 it was 11.01%).

With a total outstanding loan balance of over 478 billion VND, the lending program for near-poor households is currently the third largest outstanding loan program out of 15 lending programs that the Provincial Bank for Social Policies is implementing (after the lending program for business and production households in difficult areas and the lending program for poor households).