Who is eligible for a loan with an interest rate of only 1.2% per year?

Since November 2nd, 2015, disadvantaged families in ethnic minority and mountainous regions have been able to borrow capital for afforestation and livestock farming at an interest rate of 1.2% per year.

Government Decree 75/2015 dated September 9, 2015, also clearly stipulates that the specific loan amount and loan term for each policy will be mutually agreed upon by the Social Policy Bank and the household, in accordance with the provisions of the Decree.

Since November 2nd, 2015, households belonging to ethnic minorities and poor Kinh households residing stably in communes with difficult socio-economic conditions (Areas II and III) in ethnic minority and mountainous regions as defined by the Prime Minister, and engaging in one of the forest protection and development activities, are eligible to borrow capital from the Vietnam Bank for Social Policies (VBSP) for afforestation and livestock farming at an interest rate of 1.2% per year. This is stipulated in Government Decree 75/2015 dated September 9th, 2015, on the mechanism and policy for forest protection and development, linked with the policy of rapid and sustainable poverty reduction and support for ethnic minorities in the 2015-2020 period, which officially came into effect.

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The decree also stipulates that, for households borrowing for production forest planting and non-timber forest product development, based on the forest planting design and cost estimate, households can borrow without collateral for the remaining investment value at the Social Policy Bank with a maximum limit of VND 15,000,000/ha. The loan term is calculated from planting to main harvesting according to the business cycle of the planted tree species, but not exceeding 20 years. For households borrowing for livestock investment (buffaloes, cows, and other livestock), the Social Policy Bank can provide loans without collateral with a maximum limit of VND 50 million, for a period of 10 years.

The Decree also clearly stipulates that the specific loan amount and loan term for each policy will be mutually agreed upon by the Vietnam Bank for Social Policies (VBSP) and the household, in accordance with the provisions of the Decree. After 2020, credit loan contracts between the VBSP and households for afforestation and livestock farming will continue to be implemented until the contract expires.

According to Tien Phong