Local resources need to be strengthened to support the poor and other vulnerable groups affected by Covid-19

(VBSP News) Since the outbreak of the Covid-19 pandemic, the number of enterprises and business households closed is increasing, leading to the fact that many workers losing their jobs. In addition to the solutions VBSP has actively implemented to help the poor and last-mile populations overcome difficulties and improve production, the entrusting fund from local authorities also plays an important role in this campaign against the pandemic.

VBSP’s activities at commune transaction points

In response to the Covid-19 pandemic, VBSP has timely proposed many measures to support their customers such as adjusting the repayment term, loan extension, interest rate exemption or providing new loans. By the end of March 2020, VBSP has extended term for 5,781 loans; adjusted repayment term for 606 loans with the amount of VND 14.4 billion and provided 1,757 new loans with the amount of over 51.6 billion.

Besides, VBSP actively reported to VBSP's Board of Directors to submit to the Prime Minister the proposal of reducing interest rates for the poor and other vulnerable groups. If the plan is approved, from April 1, 2020 to the end of 2020, regarding the poor households and programs with interest rates equal to the poor households, the interests will be reduced by 15% and regarding disadvantaged groups in other programs, the interests will be decreased by 10%.

As of March 30, 2020, VBSP has conducted over 20 credit programs with total outstanding loan of VND 211,006 billion (an increase compared to VND 4,201 billion in 2019). In the first 3 months of 2020, the total lending turnover reached VND 18,723 billion, with more than 6.5 million active customers.

However, the implementation of these solutions will result in the shortage of revolving fund. VBSP Deputy General Director and Director of VBSP branch in Hanoi – Ms. Le Thi Duc Hanh said: “According to the 2020 plan, Hanoi branch will collect about VND 712 billion, but now it is only expected to collect about VND 300 billion. Meanwhile, the group most affected by the Covid-19 epidemic is animal husbandry, small business, service business, health care, and transportation with outstanding loans of VND 2,384 billion, accounting for 28% of the total outstanding loans of the branch. Only those who borrow from local budget transferred to VBSP affected by Covid-19 have reached 30,400 customers with the amount of VND 1,168 billion. Up to now, there are about 25,000 customers who are eligible for borrowing loans to improve production and business with expected amount of VND 40 million/household. Therefore, the amount of additional loans is VND 1,000 billion”.

Clip of interviewing Ms. Le Thi Duc Hanh - VBSP Deputy General Director and Director of VBSP branch in Hanoi

In order for the disadvantaged people not to be left behind because of the Covid-19 pandemic, Hanoi entrusted VND 650 billion to VBSP branch in Hanoi in 2020 (phase 1) to meet about 65% of the need of the poor and other vulnerable groups affected by Covid-19 in 2020. In addition, in March 2020, Ho Chi Minh City also transferred VND 760 billion of local budget to VBSP to provide loans for the poor and other last-mile populations of the city affected by Covid-19 pandemic.

As a result, the efforts of local authorities have been highly appreciated by the Prime Minister. It cannot be denied that local authorities are expected to continue to share the burden and join hands with the Government and the Banking sector to transfer local fund through VBSP so that the poor and other vulnerable groups affected by Covid-19 can improve production and get jobs.

vbsp.org.vn