Policy Credit Supports the Poor

From VBSP’s preferential credit programs, many farmers in U Minh Thuong commune (An Giang) have expanded production scale, increased income, and stabilized their lives.

With the support of preferential credit, Mr. Lam Van Deo’s family (in Trung Doan hamlet) started vegetable farming and stabilized their livelihood

Rising Out of Poverty

In the past, the family of Mr. Lam Van Deo (in Trung Doan hamlet) mainly grew rice. However, due to low yields and many dependents, their life was difficult. With support from the local authorities, Mr. Deo’s family accessed preferential credit loans, learned from effective development models, and started raising fish and pigs. After a few years, his family escaped poverty and achieved stability.

Mr. Deo shared: “Previously, I wanted to change my production model but faced difficulties in fundings and techniques. My son worked as a hired laborer in Binh Duong but the income was only enough to live on. Thanks to preferential credit, my family shifted to vegetable farming with a sustainable plan. Now, just by growing cucumbers and yardlong beans, we earn between USD 20 - 40 per day”.

The family of Ms. Le Thi Dung (in Cong Su hamlet, U Minh Thuong commune) had only a small plot of land. Despite their hard work, they still faced many difficulties. In 2013, Ms. Dung accessed a loan from VBSP and, combined with their savings, rehabilitated their garden and converted the unused land along the dikes to grow vegetables, especially Chinese chives. This model helped her family get out of poverty.
Ms. Dung said: “The first time, my family received about USD 320 from policy credit, together with our savings we started selling fresh vegetables. My husband learned the model of growing chives in Bac Lieu and applied it effectively. Since our land was small, we cooperated with three other households to grow chives. When harvesting, my husband and I purchased all the produce to supply markets. Thanks to this, our family escaped poverty and our life became more stable”.

Mr. Dinh Van Be, Head of the Trung Doan hamlet Savings and Credit Group, said: “The group has 59 households borrowing preferential credit from VBSP with a total loan balance of more than USD 120,000. Most households use the loans for the right purposes, effectively, and have escaped poverty, stabilized their lives, and contributed to implementing national target programs on poverty reduction, job creation, and social security in the locality”.

Improving the Efficiency of Credit Use

The policy credit sources and new programs have been promptly implemented by VBSP U Minh Thuong Transaction Office, helping people access information and loans for production, business development, and better livelihoods.

To make it convenient for the people, the Transaction Office has arranged six fixed transaction points; and coordinated to consolidate and strengthen 208 Savings and Credit Groups through mass organizations. These groups not only operate stably and effectively but also act as a bridge between the bank and the people in disseminating policies, disbursing loans, and managing credit. Loan appraisal and supervision are carried out transparently and democratically at the grassroots level, with the participation of borrowers, groups, and mass organizations, ensuring that credit reaches the right beneficiaries.

At the same time, the unit regularly coordinates with agencies to provide counseling, vocational training, and technology transfer linked with lending activities, thereby forming effective economic models.
Ms. Nguyen Thi My Tien, Deputy Director of VBSP U Minh Thuong Transaction Office, shared: “We always accompany the locality in poverty reduction with two key roles: creating jobs, raising income, developing efficient household production; and improving the quality of entrusted lending through mass organizations. To ensure preferential credit reaches the right beneficiaries and is effective, we disburse directly with entrusted management through mass organizations”.

In reality, policy credit borrowers in U Minh Thuong have used the loans for the right purposes and effectively. The loans have enabled poor households, near-poor households, and policy beneficiaries to invest in production and business, improve income, reduce poverty, and contribute to building new rural areas.

Currently, VBSP U Minh Thuong Transaction Office is implementing preferential credit programs with a total outstanding loan portfolio of over USD 21.3 million, serving 10,735 borrowing households through 208 Savings and Credit Groups. Many households have taken advantage of local strengths and potential to invest in production and business, bringing profitability.

Thuy Tien