Maximizing the Effectiveness of Policy Credit in Thai Nguyen (Part 1: Guided by the Party)

Directive No. 40-CT/TW issued by the Party Secretariat on strengthening the Party's leadership over policy credit has profoundly transformed the landscape of many rural areas, including Thai Nguyen. However, the most significant achievement after 10 years of implementing Directive No. 40-CT/TW is the shift in awareness among party committees, authorities and society as a whole regarding poverty reduction and ensuring social welfare for vulnerable groups.

Policy credit mobilizes the entire political system into action

Everyone Getting Involved

To ensure that policy credit reaches the right beneficiaries, VBSP Thai Nguyen Provincial Branch has implemented a delegation lending method through mass organizations. This involves establishing and managing Savings and Credit Groups at the grassroots level.

To date, the total outstanding delegated loans through mass organizations is VND 4,700 billion with 2,628 Savings and Credit Groups, accounting for 99.47% of the total lending balance of VBSP Thai Nguyen Provincial Province. Of this, the Farmers' Association manages more than VND 1,342.8 billion (28.46%); the Women's Union manages nearly VND 1,360.8 billion (28.85%); the Veterans' Association manages over VND 1,048.6 billion (22.23%); and the Ho Chi Minh Communist Youth Union manages over VND 965.4 billion (20.46%).

The collaboration of these four mass organizations, which both monitor social activities and act as delegates in some aspects of the policy credit process, has enabled VBSP Thai Nguyen branch to assist these organizations in mobilizing forces, increasing membership and enhancing their organizational capacity. This allows them to better perform their roles and improve the quality of their movements, thereby strengthening the political system at the grassroots level.

In villages, the head of each hamlet plays a direct role by monitoring the loan approval process, checking the activities of Savings and Credit Groups, coordinating loan fund usage, and ensuring debt recovery. As a result, VBSP’s loans have reached the correct beneficiaries, and most households have used the loan funds for their intended purposes.

Mobilizing Significant Resources

In line with Directive No. 40-CT/TW and Conclusion No. 06-KL/TW from the Party Secretariat, every year, the local party committees and authorities in Thai Nguyen Province direct relevant agencies to allocate a portion of the local budget for delegation through VBSP to lend to poor households, near-poor households and other policy beneficiaries.

Up to now, Thai Nguyen Province has focused on mobilizing resources for policy credit with strong involvement from the entire political system and local people. The goal of poverty reduction and revitalizing social policy credit activities has become a key task for local authorities. Therefore, investment in economic, social development and sustainable poverty reduction programs has been strengthened, primarily from the central and local budgets. Preferential credit funds have been mobilized and used effectively.

By the end of October 2024, the local budget fund allocated to VBSP reached VND 255.73 billion, an increase of VND 45.773 billion compared to the end of 2023, bringing the total policy credit fund of Thai Nguyen to VND 4,920.656 billion. Additionally, VBSP Thai Nguyen Provincial Branch has mobilized VND 515.312 billion, and funds from companies and enterprises entrusted to VBSP reached VND 6.633 billion, an increase of VND 5.098 billion (a 332% rise) compared to before the implementation of Directive No. 40-CT/TW. Funds from the “For the Poor” movement initiated by the Vietnam Fatherland Front, charity funds and other sources amounted to VND 1.535 billion, doubling compared to before the directive.

Director of VBSP Thai Nguyen, Mr. Nguyen Quang Thinh, affirmed that the most favorable aspect of implementing policy credit activities is that, over the years, local leadership has consistently prioritized poverty reduction efforts and recognized the importance of policy credit in achieving sustainable poverty reduction. Each year, the provincial People's Committee and the nine districts and cities under its jurisdiction promptly allocate and delegate local budget funds to VBSP, allowing poor households and ethnic minorities to take preferential loans for production and business investment.

Dong Du