Nghe An Social Policy Bank: 15 years accompanying the poor

(Baonghean) -The Nghe An Provincial Social Policy Bank branch officially opened on April 9, 2003. After 15 years of operation, it has successfully fulfilled the political goals and tasks assigned by the Party and the State. Nghe An Newspaper reporter interviewed Mr. Tran Khac Hung - Director of Nghe An Provincial Social Policy Bank.

PV:Nghe An is a difficult province, the rate of poor households, near-poor households and other policy beneficiaries is nearly twice the national average, the demand for loans of these subjects is still very large. Could you please tell us about the results achieved in mobilizing resources to meet the demand for loans in the area?

Mr. Tran Khac Hung:Immediately after its establishment, under the direction of the Vietnam Bank for Social Policies, the Nghe An Branch of the Vietnam Bank for Social Policies has well organized the reception of capital sources of preferential credit programs transferred from the Vietnam Joint Stock Commercial Bank for Industry and Trade, the State Treasury and the Bank for Agriculture and Rural Development; at the same time, it received capital sources transferred by the Vietnam Bank for Social Policies; mobilized capital sources from organizations, individuals, and entrusted capital sources from the local budget. By August 31, 2017, the total policy credit capital managed by the Vietnam Bank for Social Policies Nghe An reached VND 7,076 billion, an increase of VND 6,759 billion (22.3 times) compared to the first day of establishment, with an average annual capital growth rate of 24%.

Dien Chau Social Policy Bank transaction office disburses program capital to customers. Photo: Thu Huyen

Over the past years, the Board of Directors and the operational management apparatus together with the organizations entrusted by the VBSP from the provincial to the district level have had many drastic solutions to mobilize capital to complete the targets assigned by the Central Government. In addition, the People's Committees at all levels have paid attention to allocating a part of the budget from the source of increased revenue and annual savings to the VBSP to implement lending to policy beneficiaries in the area. Up to now, the total local budget capital entrusted through the VBSP branches is more than 99 billion VND, accounting for 1.4% of the total capital, of which: the provincial budget capital is 81.7 billion VND, the district budget capital is 17 billion VND, and the commune budget capital is more than 200 million VND.

As a result, the basic policy credit capital has promptly met the demand for loans to develop production and business and serve the essential needs of the lives of poor households and other policy beneficiaries in the province, contributing significantly to the successful implementation of the national target program on hunger eradication and poverty reduction. The total loan turnover has reached 17,675 billion VND, with 1.3 million poor households and policy beneficiaries receiving loans. The total outstanding loan balance reached 7,060 billion VND, 23 times higher than the time of handover, the average annual outstanding loan growth rate reached over 23%. Especially in the past 10 years (2007-2017), the policy credit growth rate was very high, due to the implementation of many major policies of the Government for poverty reduction and social security.

PV:Can you be more specific about some effective policy credit programs in recent times?

Mr. Tran Khac Hung:From 3 credit programs handed over with a total outstanding debt of 307 billion VND, after 15 years of operation, up to now, the Nghe An Provincial Branch of the Vietnam Bank for Social Policies is implementing 18 credit programs assigned by the Government and a number of policy credit programs from capital sources entrusted locally, monitoring and managing over 297 thousand borrowing households, accounting for about 38% of the total number of households in the province.

Some large-scale policy credit programs have achieved high efficiency such as: the program for lending to poor households, near-poor households, and households that have just escaped poverty, with more than 134,000 households using loans for livestock production with outstanding loans of VND 4,221 billion, accounting for 59% of total outstanding loans; loans in 15 years have helped more than 158,000 households have capital to develop the economy and escape poverty. Loans for students in difficult circumstances have outstanding loans of VND 921 billion, in 15 years have helped more than 244 students have the conditions to study. The program for lending to clean water and rural environmental sanitation with outstanding loans of VND 726 billion, in 15 years has contributed to the construction of more than 210,000 clean water and sanitation works.

Graphics: Huu Quan

In addition, there are a number of programs such as: Loans to solve employment problems have created jobs for more than 24,000 workers; helped more than 8,000 workers go abroad for a limited period of time; supported the construction of 28,164 houses for poor households; helped protect and develop thousands of hectares of forest...

The Government's preferential credit programs implemented by the Vietnam Bank for Social Policies are truly an important capital channel, a "midwife" for poor households and special policy beneficiaries, especially in rural and mountainous areas with particularly difficult socio-economic conditions.

Impressive numbers after 15 years of operation of Nghe An Social Policy Bank. Graphics: Huu Quan

PV:In order to transfer policy credit capital to the right beneficiaries, how has the Vietnam Bank for Social Policies implemented policy credit management methods to be suitable for practice and effective?

Mr. Tran Khac Hung:We entrust some work stages to socio-political organizations such as: guiding the establishment and directing the activities of savings and loan groups, evaluating loan subjects, guiding borrowers in using capital, checking and supervising the process of using loans, urging debt collection.

As of August 30, 2017, socio-political organizations are participating in managing 6,982 billion VND, accounting for 98.9% of total outstanding debt. The quality of entrusted credit has been continuously improved, the overdue debt ratio is now only 0.18%, down 1.63% compared to the time of handover. With the support of local authorities, entrusted organizations have coordinated with the Nghe An Social Policy Bank to establish and manage 7,701 savings and credit groups to borrow capital in 5,923 villages (hamlets, villages, and hamlets). To date, 100% of villages (hamlets) in the province have had savings and credit groups of the Social Policy Bank operating in a disciplined and stable manner.

Implementing the direction of the Vietnam Bank for Social Policies on building a network of transaction points at communes, the Nghe An Provincial Bank for Social Policies has continuously built and consolidated the network of transaction points at communes. At the transaction points, the State's preferential credit policies are publicly listed by the Bank for Social Policies, borrowers transact directly with the Bank for Social Policies on a fixed day every month to deposit, withdraw, borrow capital and repay debts in the presence of representatives of local authorities at the commune level, entrusted organizations and the group management board. Thanks to that, the loss, embezzlement, corruption and exploitation of preferential credit capital have been limited. All activities of the Bank for Social Policies related to people are carried out at the commune transaction points: from receiving documents, disbursing capital, repaying debts, interest, making savings, reflecting difficulties and problems, etc.

People in Dien Ngoc, Dien Chau borrow capital from NHCS to process seafood and develop household economy. Photo: Thu Huyen

PV:In the period of 2017-2020, the Provincial Social Policy Bank strives to provide 100% of poor households and other policy beneficiaries with needs and conditions to access capital; the average annual credit growth rate is from 7% - 10%. To achieve that goal, what solutions has the Board of Directors of the Nghe An Social Policy Bank Branch taken, sir?

Mr. Tran Khac Hung:We will continue to closely coordinate with relevant departments, branches and agencies to advise Party committees and authorities at all levels in effectively leading and directing the implementation of Directive No. 40-CT/TW dated November 22, 2014 of the Central Party Secretariat, Directive No. 29-CT/TU dated June 17, 2015 of the Provincial Party Standing Committee on strengthening the Party's leadership over social policy credit, in order to promote and enhance the role and responsibility of the entire political system to strongly participate in policy credit activities in the area; actively contributing to the implementation of the goal of sustainable poverty reduction, job creation, ensuring social security, supporting human resource training, promoting economic development, political stability and border security.

In addition, strengthen close coordination with entrusted socio-political organizations, commune and village authorities to organize strict management and effective use of policy credit capital; best ensure that poor households and other policy beneficiaries in need and eligible have access to policy credit capital in a timely, public, and targeted manner and use loans effectively...

PV:Thank you very much!

Thu Huyen

(Perform)