Giving "fishing rods" to ethnic minorities

Escape poverty thanks to policy capital

Previously, the family of Mr. Vy Van Dung, born in 1964, in Hoa Son village, Ta Ca commune, Ky Son district, was very poor, one of the poorest households in the village. In March 2008, Mr. Dung was admitted to the savings and loan group in the village and was considered for a loan of 10 million VND under the loan program for poor households.

Mr. Dung said: After receiving the loan, I bought a cow; in 2009, the cow gave birth to another cow, in 2011, three more, so my family had five cows. After that, the herd continued to grow, the family's economy improved, thanks to effective farming, in 2013 the family escaped poverty. In 2014, my family was granted 4 hectares of forest land by the State to protect the forest. My family was lent 20 million VND by the Nghe An branch of the Social Policy Bank under the job creation program to develop the herd of cows, raise goats and grow fruit trees.

The economic model of Mr. Vy Van Dung's family in Hoa Son village, Ta Ca commune, Ky Son district. Photo: Thu Huyen

Thanks to the loan from the Social Policy Bank and the assistance and guidance on applying techniques in livestock farming from the commune and the association through 2 loan periods, Mr. Hoang's family has stabilized their lives, had a source of income, and escaped poverty. The family currently has 19 cows, 10 goats, more than 100 chickens, and grows various fruit trees. The family has invested in sending their children to school, built a spacious house, has a TV, refrigerator, motorbike, and the family has invested in 2 more rice milling machines to serve the people in the village.

Over the past 15 years, policy credit programs implemented by the Ky Son District Social Policy Bank have disbursed VND 610,313 million to 30,736 poor households and other policy beneficiaries. Outstanding loans as of May 25, 2018 reached VND 246,701 million, with 10,545 households having outstanding loans. Currently, 11/21 communes have outstanding loans of over VND 10 billion. Some communes have high outstanding loans: Huu Kiem VND 33 billion, Ta Ca VND 27 billion, Chieu Luu VND 23 billion, My Ly VND 19 billion. Some communes have good credit quality such as: My Ly, Ta Ca, Huu Lap,...

Mr. Nguyen Thanh Hoang - Chairman of the People's Committee of Ky Son district said: Since 2007, after the Government allowed the implementation of specific credit programs specifically for poor areas and ethnic minorities, and especially after the Government issued Resolution 30a on the program of rapid and sustainable poverty reduction for poor districts, social policy credit has really made great contributions to the results of poverty reduction in the whole district in general and improving the lives of ethnic minorities in the district in particular; thanks to that, in the period 2010-2015, the average annual poverty reduction rate of Ky Son district reached 5.5%/the set target of 4-5%; in the two years 2016-2017, the average annual poverty reduction rate reached 4.77%/the set target of 4-5%.

General Director of the Bank for Social Policies Duong Quyet Thang encouraged Ky Son people to effectively utilize loans and develop household economy. Photo: Thu Huyen

Of the total 19 credit programs currently being implemented in Nghe An province, there are 4 credit programs specifically for lending to ethnic minorities, including: lending to ethnic minority households to develop production; lending to support residential land, production land, and domestic water for ethnic minority households; lending to poor households in communes, villages, and hamlets with special difficulties to borrow capital to plant forests and develop production; lending to develop the socio-economy in ethnic minority and mountainous areas.

Currently, the loan turnover exclusively for ethnic minorities is 5,174 billion VND (accounting for 26.2%), 424.7 thousand households borrow capital (accounting for 27.8%). Ethnic minority households have access to all credit programs currently being implemented. The current outstanding debt of ethnic minority households accounts for 22.94% of the total outstanding debt of the whole branch, the average outstanding debt/ethnic minority household reaches 28.4 million VND. Thanks to good compliance with the agreement to pay monthly interest and gradually repay the debt when due, the poor have created a habit and awareness of saving for the poor, this work has special significance for the people in remote areas, areas with many difficulties, truly a "fishing rod" to help people stabilize their lives.

Most of the people who borrowed money invested in raising livestock such as buffalo, cows, goats, pigs... With small loans, preferential interest rates, terms and mechanisms, this source of capital has truly played the role of an important "test drug" for the poorest ethnic minority groups in society. Effective use of this loan is a prerequisite to ensure success when borrowing capital from subsequent programs with larger loans, less preferential interest rates and terms.

Affirming the importance of credit channels

Since 2007, social policy credit has continued to make greater contributions to poverty reduction and improving the lives of ethnic minorities. Policy credit has contributed to rapidly reducing the poverty rate in ethnic minority areas, from 36.19% to 16.54% in the period 2011-2015 (districts 30a reduced by an average of 6-7% per year); in the two years from 2016-2017, it decreased from 24.04% to 17.04%, reducing 17,214 households. At the same time, policy credit has contributed to significantly changing the appearance of rural villages, especially poor areas and ethnic minority areas.

Mr. Tran Khac Hung - Director of the Social Policy Bank, Nghe An branch, said: In the total outstanding loans and current customers of the Social Policy Bank, Nghe An branch, the outstanding loans of ethnic minority customers account for a large proportion. In addition to the incentives when borrowing from credit programs like other subjects, ethnic minorities are entitled to a number of special credit programs with very preferential interest rates and terms. The branch has taken advantage of central capital sources and advised to increase local support to prioritize capital sources for poor districts, poor areas, and ethnic minority areas.

Graphics: Thu Huyen

Thanks to that, the capital growth rate in poor areas and ethnic minority areas is always higher than the average growth rate of the whole province, the growth rate for 11 districts in the West from 2007 to 2017 reached 44.4%, while the average growth rate was 43%. In addition to enjoying general policies like other subjects, ethnic minorities also enjoy many specific programs with special interest rates and preferential terms.

Policy credit is coordinated by the Vietnam Bank for Social Policies with socio-political organizations entrusted to establish a network of savings and credit groups serving all hamlets and villages in the province. Through loan activities, ethnic minority households receive support in sharing production experiences from members of the savings and credit groups, advice on how to do business, and are subject to regular inspection and supervision by the group management board and officers of the entrusted association...

The approach and service of the Social Policy Bank is an extremely effective solution in contributing to preventing and gradually pushing back the situation of black credit in rural areas. Policy credit is truly more meaningful than the role of a simple financial support channel for the poor in general and for ethnic minorities in particular. It has contributed significantly and directly to changing awareness, changing from thinking to working methods in production and even in the daily life of the people, especially forming the habit of saving, gradually getting used to the market mechanism.

Thanks to its advantages, in poor districts in Nghe An province, social policy credit has affirmed itself as the most important credit channel for the local socio-economic development.

Social Policy Bank conducts credit survey in Ky Son

(Baonghean.vn) - Thanks to preferential capital from the Vietnam Bank for Social Policies, many ethnic minority members of Ta Ca commune, Ky Son have had new jobs to reduce poverty and stabilize their lives.