VBSP participate in the round-table discussion with the Dutch Queen on Financial Inclusion

 (VBSP News) Deputy CEO of VBSP, Mr. Nguyen Duc Hai has just attended in a round-table discussion on the role of the private sector in promoting Financial Inclusion in Vietnam in Hanoi. The talk was led by Queen Maxima as the United Nations Secretary General’s Special Advocate for Financial Inclusion to promote access to financial services.

Deputy CEO of VBSP, Mr. Nguyen Duc Hai has just attended in a round-table discussion

Financial inclusion is the provision of appropriate and convenient financial services, especially for low-income and vulnerable people to increase the opportunities of assessing financial services, thus enhancing the livelihood, augmenting cash flow of investment capital and of savings, thereby boosting economic growth. Financial inclusion is an important foundation for economic development and poverty reduction. Financial inclusion is implemented in five main ways: Development of new products, diversifying networks of financial service providers, financial infrastructure development, protection of financial service users and universalizes financial education.

Talk on financial inclusion with Queen Maxima

Microfinance plays a crucial role in implementing financial inclusion, especially in emerging countries like Vietnam. Being the leading microfinance institution in Vietnam and also in the list of top five microfinance institutions in the world in terms of total assets and customer base, VBSP was invited to attend and contribute ideas during the talk on financial inclusion with Queen Maxima. At the discussion, VBSP’s representative, Mr. Nguyen Duc Hai, informed the Queen about the situation of microfinance sector in Vietnam, highlighting its achievements and challenges. VBSP also made suggestions to create favorable conditions for the growth of financial inclusion and maximize the capacity of VBSP to effectively promote financial inclusion. Queen Maxima highly valued the ideas of VBSP and those of the other institutions participated in the talk; these initiatives will be important inputs for the Queen’s meeting with Vietnamese government authorities concerning the establishment of appropriate policies and regulations to create favorable conditions for advancing financial inclusion in Vietnam.

Achievements of VBSP in promoting financial inclusion  

Vietnam Bank for Social Policies has been operating since March 11th, 2003 with a purpose of serving the poor, near-poor, micro, small and medium enterprises and other disadvantaged populations in Vietnam. VBSP is now the leading microfinance institution in Vietnam and also in the list of top five microfinance institutions in the world in terms of total assets and customer base. VBSP offers a wide range of loan and financial services including poor/near poor household credit, entrepreneur loans, SME loans, housing loans, clean water and rural sanitation loans, savings accounts, term deposits and domestic remittance etc.

As of 31th December 2016, VBSP has 9,000 staff and serves seven million customers through grassroots networks, appropriate infrastructure, socialised procedures and skilful staff, with US$ 6.5 billion in loan portfolio, over US$ 1 billion in deposit and total assets of USD 7 billion. Seven million customers, one-third of the total population, are active microfinance borrowers and savers of the VBSP. Those huge clientele deals with the VBSP through the network of 63 provincial branches, 629 district transaction offices, about 200,000 savings and credit groups which are established based on village/hamlet and 10,917 of fixed date transaction points in total 11,161 communes in Vietnam where commercial banks have no access. By that widest operation network in Vietnam, VBSP approaches to clients near their home instead of waiting them in the bank’s offices which often are 30 km far from their communes in average.

The inclusive advantage of VBSP is the model of fix-dated transaction point at commune/ward/town which belongs to the lowest grass-root level in the country. On a fixed date each month, the VBSP field staff team (3-5 persons) come to commune/ward/town to make transaction with clients in terms savings and loan products under witness of representatives from local mass organizations, heads of savings and credit groups and relevant commune authorities. Savings and monthly loan interest payments are being collected by the group leaders during the month, the group leaders then hand in money collected to the VBSP’s staffs on commune transaction working sessions.

VBSP is the only bank in Vietnam to reach the poor at rural, remote and mountainous areas through the innovative model of fixed-date transaction at commune/ward/town nationwide. It is one of the most effective and efficient delivery channels that help the last mile population in Vietnam access inclusive finance served by VBSP. Through this delivery channel, VBSP helps their clients save time and travel costs that almost are as high as lending interest burden. Therefore, the delinquencies of the VBSP is quite low at 0.78% and the interest repayment rate accounts for 99% by the end of 2016. VBSP’s vision is to become a leading retail and universal bank promote financial inclusion to the mass market, typically the last mile population.

Other articles on the activities of Queen Maxima of the Netherlands in Vietnam

Vietnam National Assembly Chairwoman Nguyen Thi Kim Ngan received Queen Maxima of the Netherlands 

In the afternoon on the 31^st of May 2017, Vietnam National Assembly Chairwoman Nguyen Thi Kim Ngan received Queen Maxima of the Netherlands. At the meeting, Chairwoman Ngan emphasized that Vietnam would like to receive support from the United Nations to develop financial inclusion. The Chairwoman said that she will assign one of the National Assembly’s committees to supervise agreements. She added that Vietnam has the Bank of Social Policy providing financial services to the poor and disadvantaged people in rural, mountainous and remote areas. However, due to the weakness of working conditions and poor infrastructure in those regions, the performance of the bank in such areas is not high. Thus, Vietnam wants to receive more support from the international community including the Netherlands in this area.

Queen Maxima highly appreciated the the State Bank of Vietnam’s work in drafting the national plan for financial inclusion. Nevertheless, the Queen reiterated that the process shall need the contributions of related ministries and agencies, especially the private sectors and NGOs. She asserted that such a professional system shall attract prestigious institutions to invest in financial inclusion enhancing economic growth.

Source: vtv.vn

Asking Ductch Queen to support Vietnam to mobilize funding resources and technical assistance

Deputy Prime Minister Vuong Dinh Hueproposed Queen Maxima, as the United Nations Secretary General’s Special Advocate for financial inclusion, assist Vietnam in mobilizing funding resources and technical assistance from the United Nations and other international organizations to effectively implement financial inclusion.

On the 1st of June 2017, Deputy Prime Minister Vuong Dinh Hue greeted Queen Maxima of the Netherlands on the occasion of her working visit to Vietnam. The visit aimed to better the ties between the Netherlands and Vietnam. It was also an opportunity to share information and experiences in promoting financial inclusion in Vietnam. The Deputy PM expressed his eagerness to receive and work with Queen Maxima while insisting that this was a chance for both sides to talk about the mission and vision for the draft, issuance and implementation of financial policies. This event is a milestone for relations between the two nations. 

Queen Maxima said that during this visit, she and related Vietnamese authorities discussed financial inclusion strategies of with effective and strong liquidity which meets the socio-economic needs of people. In particular, attention was paid to the policy of micro-credit for SMEs, an enormous resource for the growth of jobs and the economy. In addition, according to Queen Maxima, the content of this topic is not only about credit policy, but also the areas of savings and insurance to help people avoid risks in businesses.

The high number of people in Vietnam using cell phones creates favorable conditions for the creation of IT solutions to accelerate financial inclusion. Agreeing with the Queen’s evaluations, the Deputy PM was aware that three crucial factors for growth are the sustainability of the economy, society and the environment. The comprehensive growth agenda was adopted by Vietnam and was included in the APEC-2017 Ministerial agenda. 

Over the past years, Vietnam has applied many policies related to financial inclusion through microfinance and agricultural credit, credit security for SMEs and the poor, occupational loans and student loans.

However, Vietnam needs to have financial inclusion policies, at the same time provide communication skills training to policy implementers and beneficiaries to better acknowledge their financial rights and obligations. The dissemination of financial inclusion policy needs to ensure market principles, and the role of the Government must be in line with the market situation. 

The Deputy PM proposed the Queen of the Netherlands, in her capacity as the United Nations Secretary General’s Special Advocate for Financial Inclusion, support Vietnam in mobilizing financial resources and technical assistance from the United Nations and other international organizations for the effective dissemination of financial inclusion.

Source: baophapluat.vn