VBSP boosts policy credit, tries to repel black credit

This is an exchange of Ms. Tran Thi Lan Phuong, VBSP Deputy General Director, around the topic “Social policy credit contributes to ensuring social security and repelling black credit”.

Over the past years, VBSP has always received the attention and direction of the Party and State, especially the State Bank of Vietnam, executive party committees at all levels and authorities, close coordination of socio-political organizations, and support of the poor and other policy beneficiaries. In particular, the Secretariat of the Party Central Committee has issued Directive 40-CT /TW dated November 22, 2014, enhancing the Party’s leadership on social policy credit.

Ms. Tran Thi Lan Phuong, VBSP Deputy General Director. (Photo: VGP)

As of September 30, total policy credit outstanding balance reached more than VND223.2 trillion with nearly 6.5 million poor households, nearly-poor households, and other policy beneficiaries having an outstanding balance. VBSP is implementing more than 20 policy credit programs. Credit quality has always been improved. Bad debt ratio is always below 1% of total outstanding balance. 

Over the past 18 years, more than 38 million poor households and other policy beneficiaries have received loans. Policy credit capital has been invested in 100% of communes, wards and towns nationwide; with the focus on lending to communes in ethnic minority areas, remote areas, borders, islands and extremely difficult areas. 

The move contributed to helping over 5.8 million households pass the poverty line; attracting and creating jobs for nearly 4.3 million workers; helping more than 129,000 workers in policy families borrow capital to work abroad for a definite term; nearly 3.7 million students, students with difficult circumstances have access to loans to study; and building more than 13.7 million water and sanitation works in rural areas and nearly 731,000 houses for poor households and policy households.

Social policy credit has contributed to carrying out national target programs on sustainable poverty reduction, new-style rural areas building, job creation, social security ensuring, political security and social order stabilization in localities and socio-economic development, with the motto of not leaving anyone behind.

VBSP Deputy General Director Tran Lan Phuong said that in the face of the complicated black credit situation in many localities, leaders of VBSP directed conducting a survey on the situation of black credit loans of social policy beneficiaries being borrowers of the bank. 

Quick surveys of some localities and regions nationwide and statistics of VBSP’s branches in the whole system showed that no VBSP customers have been reported in this activity. About 150 households got loans with indirect effects from black credit (families with children involved in black credit).

On that basis, leaders of VBSP said that the bank plans to propose to the Prime Minister the implementation of a pilot plan of expanding consumer credit to poor and nearly-poor households to serve their legitimate essential demand of life, contributing to repelling “black credit”.

In order to contribute to repel “black credit”, VBSP has strengthened management of credit quality, coordinated with grassroots authorities and organizations to connect agriculture, forestry and fishery extension with loans to improve the efficiency of credit use, enhance communication, and disseminate policy to the poor and other policy beneficiaries./.