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Updated: 2018-09-27 16:08:50

Microcredit from VBSP transforms the lives of Bac Kan's poor families

Thanks to microcredit programmes from Vietnam Bank for Social Policies, various ethnic minority families have received the funding needed to kick-start their business and lift themselves out of poverty.

microcredit from vbsp transforms the lives of bac kans poor families

Luong Thi Hien at her forest, funded by microcredit from Vietnam Bank for Social Policies

Before receiving the microcredit, Vuong Thi Xuan struggled as a Nung ethnic minority woman from Na Cu hamlet, Cam Giang commune, Bach Thong district of Bac Kan province. Similar to other families, Xuan went through a difficult childhood and poverty persisted after she got married.

Xuan and her husband took care of their three children in a run-down house, without any land to call their own. The husband worked odd jobs, while Xuan was a stay-at-home mother due to her heart problems.

Xuan’s life was changed after she took out a loan from Vietnam Bank for Social Policies (VBSP). At only VND5 million ($215), the loan was relatively small, but enough for Nung to build a pig sty and some pigs to raise. Thanks to her hard-work and help from other farmers, Xuan was soon able to repay the loan and took out bigger ones to raise her expanding herd. The family is now out of poverty and their home has been refurbished.

In 2016, Xuan was granted a VND42 million ($1,800) loan package from VBSP to venture into forestry. The family currently owns 2 hectares of forest and three deer for antlers. The forest is now three years old and ripe for harvest, while the antlers can be sold for VND20 million ($857) per kg.

“Deer is easier to raise than cattle, so we hope that the new money from VBSP will help us increase our deer herd,” said Xuan.

Similar to Xuan, Luong Thi Hien, an ethnic Tay woman from Bach Thong district, took out a loan from VBSP and transformed her life. Prior to this loan, Hien was a farmer with a small paddy field and some cattle. However, she did not make much money and could not protect her crops or cattle from bad weather or diseases.

Thanks to the money from VBSP, Hien and her family were able to improve the efficiency of their crop and cattle. The family soon became better off and their life improved dramatically.

Most recently, in March 2016, Hien borrowed VND35 million ($1,500) and spent it on forestry. Two years later, this small forest is expected to fetch the family VND60 million ($2,571). The family also has 4,000sq.m of paddy fields, which is another stream of income.

It is estimated that VBSP manages more than 20 credit programmes, with outstanding loans of VND177 trillion ($7.5 million). About 8.4 million loans have been disbursed among 6.7 million customers, about 24.4 per cent of whom are from ethnic minority families—each family borrowed VND29 million ($1,242) on average.

The money is used for business activities, forestry, husbandry, and agriculture. Families also used the capital to renovate their homes or build clean water systems or send their children to school. The money has indeed transformed the lives of millions of ethnic minority families.

According to Dr Bui Sy Loi, member of the National Assembly, the credit programmes from VBSP are highly regarded by the National Assembly and other governmental authorities.

“The programme has helped ethnic minorities to improve their lives, escape poverty, and build a better future for their entire family. Social security also improved due to the decreased crime rates and better education,” said Loi.

Nam Phuong - Vietnam Investment Review



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


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