Preferential loans under Decree 28: Empowering people in difficult areas

In order to provide preferential loans for people in difficult areas, on April 26, 2022, the Government issued Decree No. 28/2022/ND-CP on preferential credit policies for the implementation of the National Target Program for socio-economic development in ethnic minority and mountainous areas from 2021 to 2030, phase 1 from 2021 to 2025 (Decree 28). After years of implementation, people in mountainous communes in the province have access to preferential capital, creating a motivation to sustainably escape poverty.

In early October 2022, we had the opportunity to visit Mr. Nong Van Dong, Na Phuoc village, Van Thuy commune, Chi Lang district. Mr. Dong excitedly said: “My family is poor, we don’t have capital for production, in September 2022, my family was instructed by a staff of the Bank for Social Policies (BSP) to make a loan application of 100 million VND from loan program for job change under Decree 28 for production. The loan program has a preferential interest rate at 3.3%/year, the loan term is up to 10 years. With such a support, my family is very delight and pay full attention to economic development. Thanks to this capital, now, my family has developed a model of afforestation with ​​3 hectares of pine, developing pig breeding with 10 pigs and 5 buffaloes.”

Officers of the Transaction Office of BSP in Trang Dinh district inform people about loan programs under Decree 28

The joy does not only come to Mr. Dong’s family, from the loan programs under Decree 28, many poor households in the district have access to capital to support the construction of houses and do animal husbandry and afforestation. Ms. Quach Thanh Huyen, Deputy Director of the Transaction Office of BSP in Chi Lang district said: “In order to timely implement the programs, we have actively reported and advised the District People’s Committee and the Board of Directors of BSP of the district and coordinated with relevant divisions and commissions of the district, the People’s Committees of communes and towns, created entrusted associations to review beneficiaries, promote the introduction about Decree 28 to the people in the area. Up to now, the transaction office has disbursed loans to 56 households with the amount of 3 billion VND.

According to Decree 28 of the Government, BSP is assigned to implement 5 loan programs, including loans for residential land; housing; production land and job change; investment, the development of areas growing precious medicinal herbs; production development with the value chain. Accordingly, the borrowers are poor ethnic minority households, or poor households with Kinh ethnic legally residing in extremely difficult communes, extremely disadvantaged villages in ethnic minority and mountainous areas. In addition, households, businesses, cooperatives, unions of cooperatives and production and business organizations employing ethnic minorities are also eligible for loans under this Decree. Loan programs provide preferential interest rates; with the housing loan program in the first 5 years, customers do not need to pay the principal; the loan term is from 10 to 15 years (depending on the program).

BSP staff in Chi Lang district disbursing loan of programs under Decree 28 to people in Huu Kien commune

With such preferential policies, people are very delightful and excited when they have access to the capital. Ms. Dinh Thi Bich, Na Lenh village, Thach Dan commune, Cao Loc district shared: “My family is a poor household, living in a deteriorated house for many years. Last September, 2022, I was instructed by an officer of the Commune Women’s Union and BSP staff to make a loan application for the housing support program with the amount of 40 million VND with a preferential interest rate. With my family’s saving, I built a better house.”

Decree 28 of the Government meets the expectations of many poor households living in difficult areas. In 2022, the Provincial Bank for Social Policies are allocated 25 billion VND by the central government to implement the program. Immediately after the guiding document was issued, the Provincial Bank for Social Policies quickly implemented solutions to implement the loan program.

Mr. Pham Manh Ha, Deputy Director of the Provincial Bank for Social Policies said: “In order to effectively implement this program, immediately after receiving the guidance from the Central Government, the branch actively advised the Board of Directors of the Provincial Bank for Social Policies to ask the Committee for Ethnic Minority Affairs, relevant departments, commissions, sectors, mass organizations and localities to implement. At the same time, the district transaction offices was asked to coordinate with the Division of Labor, Invalids and Social Affairs – Ethnic Minorities, the Office of Lang Son City People’s Committee to advise the People’s Committee at the same level to request communes, wards and towns to review, identify objects to submit to People’s Committees of districts and city for approval. The units with subjects approved by the competent authorities coordinate with the entrusted mass organizations to provide loan in needs. Currently, the branch has disbursed a loan of 4.5 billion VND to 94 households. The branch strives to disburse the remaining capital before October 31, 2022 to provide the capital in time for households to produce, construct and repair houses.

Decree 28 of the Government have created motivation for ethnic minorities living in mountainous areas of the province to do business, to sustainably escape poverty, and get rich in their homeland. Thereby, the gap between rural and urban areas will gradually be erased. In the coming time, the Provincial Bank for Social Policies will continue to introduce capital policies to the people and direct the transaction offices of BSP in the districts to promptly disburse funds when people have needs.