Policy credit provides strong support for poverty reduction programs.

Giving someone a "fishing rod" can help change lives.

Together with officials from the Social Policy Bank of Nam Dan district, we visited the family of Ms. Ton Thi Vinh in Hamlet 5, Nam Thanh commune. In 2015, after her husband passed away, Ms. Vinh's family fell into poverty and despair, as the entire family of four depended solely on Ms. Vinh's labor and a few acres of leased farmland.

Ms. Vinh said: “Luckily, the Social Policy Bank of Nam Dan district lent me 20 million VND at that time. I used the loan to buy a breeding cow, then worked hard to take care of it so that it would quickly give birth to calves. I used the remaining money to build a cow shed. Fortunately, the cow gives birth to one calf every year, so by 2028 I will have paid off all my bank debt and still have two cows as capital.”

Thanks to the first loan and her hard work, Ms. Vinh's family escaped poverty, and she continued to borrow 30 million VND under the near-poor household category to buy two more cows. Each cow gives birth once a year, and she uses the money from selling the cows to invest in more chicken breeds. To date, Ms. Vinh has repaid all her bank debt and now her family owns four breeding cows and a flock of over 200 chickens. With a stable family economy, she is able to care for her elderly mother and provide for her two children's education.

Another family that rose from poverty to a comfortable one thanks to a loan from the Social Policy Bank is that of Ms. Pham Thi Yen in Hong Son hamlet, Kim Lien commune. Previously, her family was only familiar with farming, and the income of the entire family of six depended on more than one acre of rice fields. “In 2020, I applied for a policy loan to buy a cow. After the cow gave birth, I repaid the debt. At the beginning of 2023, I continued to borrow 50 million VND to buy breeding stock including pigs and chickens, and set aside some money to build a biogas tank. This ensures environmental hygiene in livestock farming and allows us to utilize the gas for cooking, saving costs,” Ms. Yen said.

Currently, Ms. Yen's pig herd consists of 8 fattening pigs and 2 sows that have recently given birth. She anticipates that after the piglets are sold, she will be able to repay most of her bank debt and have capital to continue developing her business.

Mr. Nguyen Sy Hai, Director of the Social Policy Bank of Nam Dan district, said: “We have always maintained a loan capital level higher than the provincial average. In the first nine months of 2023, we mobilized nearly 16 billion VND in savings deposits. This was achieved thanks to the branch's early consultation with the representative boards of the communes to coordinate propaganda and find customers to deposit savings at transaction points in the communes.”

Nam Dan district is building a model new rural area, so the Party committee and government are paying close attention to investing in economic development and helping people access loan capital. The loan group representatives are also actively promoting effectiveness.”

In Quynh Nghia commune (Quynh Luu district), many households, in addition to borrowing capital from the Social Policy Bank to invest in their children's education and agricultural production, also borrow to invest in deer farming. For example, Ms. Truong Thi Lien in Hamlet 2, Quynh Nghia commune, borrowed 100 million VND in 2022 from the Social Policy Bank's job creation fund. She invested the entire amount in buying deer breeding stock, with an average price of about 13 million VND per breeding deer. After one year of care, her herd of 12 deer has been yielding antlers quite regularly.

Seeing the effectiveness of preferential loan capital, more and more households in Quynh Nghia commune are registering to borrow. Currently, the total outstanding loan balance from the Social Policy Bank in Quynh Nghia commune is approximately 4 billion VND; most households that borrowed capital have made good use of the loan, repaid interest on time, and have no bad debts.

According to the assessment of the Social Policy Bank's representative board in Quynh Luu district, in the first nine months of 2023, social policy credit capital supported investment in production and business, creating jobs for more than 1,300 workers; helped 154 disadvantaged students borrow capital for their studies; built nearly 7,000 rural clean water and sanitation projects; 22 social housing units for policy beneficiaries; and disbursed loans to 13 households to purchase computers and online learning equipment for students. Along with loan growth, improving credit quality has been a priority.

Outstanding loans continue to increase significantly.

As of September 30, 2023, the total capital for implementing policy credit programs reached VND 12,140 billion, ranking 4th nationwide, with a growth rate of 11.6%. The total outstanding policy credit in Nghe An reached over VND 12,126 billion, achieving a growth rate of 11.61%, 2.64% higher than the same period last year. Ten credit programs saw growth in outstanding loans compared to the beginning of the year. The growth rate of outstanding loans is equivalent to the growth rate of capital, demonstrating that the management and disbursement of capital are very good, timely, and prevent capital from being idle.

The entrusted associations and organizations have supervised the loan application review process to ensure transparency and that loans are granted to the correct beneficiaries; they have guided the preparation of necessary documents and procedures, and coordinated with banks to ensure timely disbursement to each household at the commune-level transaction points. The growth rate of outstanding loans managed by the four associations and organizations is relatively uniform and has consistently exceeded 10%.

In the first nine months of 2023, Nghe An province provided preferential credit to 60,417 poor households and other policy beneficiaries to borrow capital for production, business, renovation of clean water storage facilities and sanitation facilities, purchase of social housing, and purchase of learning equipment for their children.

According to Mr. Bui Thanh An, Vice Chairman of the Provincial People's Committee and Head of the Board of Directors of the Provincial Social Policy Bank, the Social Policy Bank's operations have continued to achieve good results and have many positive aspects; lending has been quite high despite low credit growth across the entire banking sector; the digitalization of mobile banking has been implemented, guiding customers on how to use the service… Social policy credit continues to make important contributions, helping to achieve the province's socio-economic development targets for the first nine months of 2023.

Besides the achievements, the reality from the beginning of the year until now is that many localities in the province have been severely affected by natural disasters, such as heavy rains causing flooding, flash floods, landslides, etc., causing heavy losses in terms of people, property and people's lives; at the same time, affecting the loan capital of policy credit programs. Some loan programs for residential land, production land, value chain loans and cultivation of valuable medicinal plants are facing difficulties due to the lack of approved beneficiary lists to request timely capital allocation and disbursement, while the deadlines for these programs are running out.

To successfully complete the annual plan, Mr. Tran Khac Hung, Director of the Provincial Social Policy Bank, stated: The Provincial and District Boards of Directors are continuing to advise districts and towns to allocate budget resources to supplement lending capital for 2023 and 2024; review beneficiaries of credit programs under Government Decree 28/ND-CP, and districts should promptly approve the list to request additional capital and disburse funds in a timely manner. District-level Social Policy Banks, entrusted organizations, and related units are implementing preferential credit policies effectively in their areas, disbursing funds promptly; and closely monitoring capital to ensure loans are given to the right beneficiaries, used for the right purposes, and utilized efficiently.

We are also particularly focused on effectively implementing the loan program for those who have completed their prison sentences, in accordance with the Prime Minister's policy; considering and addressing risky debts caused by objective factors during the recent floods in the province. We will continue to promote the provision of Mobile Banking services to customers; and raise awareness among the public about and use of the service, contributing to increased benefits for customers in general and policy beneficiaries in particular…”.

Mr. Tran Khac Hung - Director of the Social Policy Bank of Nghe An province