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Updated: 2019-05-09 11:35:31

Effective tool in implementing National Targets

(VBSP News) Talking about poverty reduction, many people think that it is important to give the people “a rode” for “fishing” or in other words to lend money for business and production to raise income for the people. But in fact, the story of escaping from poverty has a lot of things to do including indirect methods. Evidences can be vividly seen through effectiveness of special social policy credit programs in the period of 2016-2020.

Hoạt động tín dụng chính sách đã và đang thẩm thấu và lan tỏa trong đời sống

Policy credit activities have been absorbed and spread in life

Direct support tools for poverty reduction

Mr. YaGa and his wife K'Dot in Gia Ba village, Tân Hội commune, Đức Trọng district (Lâm Đồng) can now enjoy their old age and no longer in the list of poor households thanks to student loans for their children instead of production and business loans. They have nearly 3,000 m2 of coffee, 36,000 m2 of paddy field and raise pigs, but in the first days of the 21 st century, the couple still had to work as hired laborers to feed 6 children, sometimes even faced hunger. Their first daughter who was born in 1983 could only go to medical school when the couple was “directed” to VBSP’s loan by Savings and Credit group and staff of Women’s Union. A loan of VND 3 million at that time helped the family to pay tuition fee, but, living expenses for the girl at school made the family financial resources even more exhausted.

"When my second child passed the pedagogy college, I told her that we could not afford her studying. She cried for two days and two nights, "said Mrs. K'Dot. With the love for her child, she went to VBSP for another loan. Then, her next 3 children, except the second youngest one, followed their sisters to universities with funding from VBSP Duc Trong district. She said “I borrowed but they paid. The older child graduated, went to work and helped us and the younger ones. At present, 3 among 5 student loans of her family are fully repaid, the remaining 2 loans at the total of VND 75 million, are for 2 children at school and not yet matured. When being asked why she tried so hard for her children to go to school despite her family poverty, she smiled “K'Ho people are matriarchy, when getting married, we have to give girls land, fields but we don’t have, so we try to give them knowledge to support themselves and get rid of sustainable poverty ”.

Among 6 children, 4 have graduated and got jobs, only two girls are studying in Da Lat. With an additional loan for near-poor households in 2015 for replanting coffee and supports from children, the couple are now leisurely looking after their gardens.

Similar to Yaga’s family, Ykhuan’s family in Donden village has been a “long time” customer of VBSP since 2005 with a loan of VND 5 million for the poor. Up to now, his family is still in sustainable poverty because the family own only 1,8 ha coffee but raise 7 children. Despite poverty, he cannot ask his children to leave school, partly because “they cry whenever I ask them to” and partly due to his wish “We are illiterate, we should let our children learn, getting a profession to earn for their livings”

Therefore, from 2010 to now, he has borrowed  VND 34.5 million from VBSP for his 3 children to keep studying, one has graduated with banking and finance profession and got a job, another is studying medical in a college in Sai Gon and the rest studying foreign languages in Da Lat. As his children grew up, the burden of raising children decreased, thus, his family got out of poverty in 2017. Since then, he borrows VND 30 million to plant coffee to help his children completing their dreams of apprenticeship.

Such above poverty alleviation stories prove efficiency of policy credit to the poor and policy beneficiaries for business and production development carried out by VBSP is an important component in the national target program on sustainable poverty reduction and new rural construction in recent years.

The effect of implementing National target programs is increasingly widespread with VBSP establishing a Steering Committee, an Implementation plan and assigning tasks to implement national target programs in the period of 2016 - 2020 at VBSP, in which the General Director of VBSP is the Head of the Steering Committee. At VBSP branches in provinces and cities, Implementation plan of National target programs in the period of 2016 - 2020 are actively developed to advise  authorities and the Board of Directors representatives for direction and implementation. At the same time, advising local authorities to allocate part of local state budget to entrust to VBSP to supplement loans for the poor and policy beneficiaries in the area and direct and monitoring, identifying poor, near poor, newly escaped from poverty households to implement policy credit. At the same time, on the basis of the list of districts and communes approved for new rural development in the 2016-2020 period in the locality, each VBSP unit selected and registered to support 01 district and commune in new rural development.

Besides, VBSP has actively coordinated with relevant ministries and agencies to actively advise and submit proposals to the Prime Minister to amend many  policies and mechanisms, such as: Job creation loan program according to Decree No. 61/2015/ND-CP; lending to poor and disadvantaged ethnic minority people in the Mekong Delta; lending to support poor households to build houses to prevent and shelter from storms and floods in the Central region; loans for forest protection and development associated with fast and sustainable poverty reduction; increase loan amount limit for the student loan program and the program of Rural safe water and rural sanitation etc,.

In addition, VBSP actively coordinated to supervise and evaluate the implementation of Resolution No. 76/2014/QH13 on June 24th , 2014 of the National Assembly on promoting implementation of sustainable poverty reduction targets by 2020; deployed survey on implementation of credit policies for poor ethnic minority households; proposed to ministries and agencies in submitting to the Prime Minister for approval the list of poor districts and districts escaped from poverty in the period of 2018-2020; amendment and supplement of Decision 131/QD-TTg approving the list of extremely difficult communes in coastal areas and islands in the period of 2016 - 2020; issuance of Resolution No. 71 / NQ-CP on some policies for poor households with multi-dimensional shortages; amendment of Circular No. 17/2016/TT-BLDTBXH guiding the process of reviewing the poor and near-poor households annually according to the multi-dimensional approach to poverty applied for the period of 2016-2020;

Policy credit capital in recent years has been focused on lending to poor households, near poor households and other policy beneficiaries, of which over 90% of policy credit outstanding loans are focused on investment in agricultural sector, rural areas, education and training. Total lending of credit programs for the period 2016-2018 reached VND 159,091 billion; debt collection revenue reached VND 116,411 billion As of December 31st, 2018, total outstanding loans of policy credit programs reached VND 187,792 billion, increased by VND 16,003 billion (+ 9.3%) compared to 2017, with nearly 6.7 million active borrowing poor households and policy beneficiaries.

For poor districts according to the Resolution No. 30a / 2008 / NQ-CP dated December 27, 2008 of the Government, the loan turnover reached VND 6,121 billion, with nearly 185 thousand turns of poor households and other policy beneficiaries borrowing capital; total outstanding loans of policy credit programs in poor districts reached VND 20,309 billion, with nearly 595 thousand outstanding loans. At the end of 2017, the average debt balance of a poor district was over VND 227 billion; Currently, the average loan balance is over 239 billion VND / district.

With the goal of synchronous investment in socio-economic infrastructure for poor districts, poor communes, villages with special difficulties according to new rural criteria, VBSP has housing loan program and rural clean water and environmental sanitation program. Total loans in new rural communes in the period of 2016-2018 nationwide reached VND 98,814 billion, accounting for 62.1% / total sales of credit programs at VBSP. Average debt / commune reached VND 17.5 billion, increased by VND 3.9 billion (+ 28.7%) compared to the beginning of 2016.

Contribute to new rural development

In the period of 2016-2018, 3.9 million turns of poor households, near poor households, newly escaped from poverty households and other policy beneficiaries have borrowed from VBSP. Policy credit capital contributes to create jobs for more than 226 thousand employees, of which more than 6,000 workers go to work abroad for a definite time; help nearly 90 thousand disadvantaged students to borrow money to study; building more than 1.5 million clean water and sanitation works in rural areas; building nearly 53 thousand houses for poor households;

Poverty alleviation and new rural construction supports are entitled to additional impetus from social security activities of VBSP's. In the period of 2016-2018, VBSP spent over VND 70.6 billion in gifts to poor households, policy households and build gratitude houses, great unity houses, support families at risk due to natural disasters, floods, and environmental disasters etc.

To continue being a pillar resource to implement the National poverty reduction program in the period of 2016-2020, in addition to allocating resources and organizing implementation of social policy credit programs, VBSP will proactively report and work with relevant Ministries and agencies to propose to the Prime Minister for allocation of State budget to provide funding for policy credit programs and to provide charter capital to VBSP according to regulations; focus on directing timely disbursement of policy credit programs according to the assigned plan; meeting the demand for loans of beneficiaries. implement solutions to simplify prescribed procedures, maintain and improve credit quality. Effective coordination between industrial promotion activities, agricultural, forestry and fishery extension, technical assistance, technology transfer, product consumption of state organizations, non-business units, enterprises, mass organizations and social policy credit activities will be the motivation for credit policy to penetrate and spread in life.

Minh Ngoc



Poor Households

Lending to poor households 6,6%/year
Lending to poor households in 64 poor districts as stipulated by the Government Resolution No.30a in 2008 3,3%/year

Near Poor Households

Lending to near poor households 7,92%/year


Lending to disadvantaged students 6,6%/year

People in need of loans for job creation

Lending to business establishments owned by war invalids and handicapped persons 3,3%/year


Term Deposit Rate
Overnight 3,04%/year
1 week 3,23%/year
2 week 3,5%/year