Promoting digital transformation, improving the efficiency of policy credit to best serve the poor

Pillar of poverty reduction and social security

According to the latest report of the Vietnam Bank for Social Policies, to date, the total source of social policy credit has reached over 416 trillion VND, an increase of over 409 trillion VND compared to 2002, with an average annual growth rate of 21.4%; of which 58,783 billion VND is capital entrusted from local budgets. The total outstanding debt of policy credit programs has reached over 376 trillion VND. The average annual growth rate of outstanding debt has reached 21.1%. Currently, more than 6.8 million poor households, near-poor households and policy beneficiaries have outstanding loans at the Vietnam Bank for Social Policies.

Over the past 23 years, nearly 47.9 million poor households and other policy beneficiaries have received preferential loans; thereby helping more than 7 million households overcome the poverty line; attracting and creating jobs for more than 7.6 million workers; helping more than 4 million disadvantaged students get loans for their studies; building nearly 20.4 million clean water and environmental sanitation works in rural areas; building, purchasing, and leasing nearly 784,000 houses for poor households, low-income households, and policy beneficiaries, etc.

Governor of the State Bank of Vietnam and Chairwoman of the Board of Directors of the Vietnam Bank for Social Policies Nguyen Thi Hong requested banks to focus on digital transformation to optimize processes, helping people access capital quickly and effectively.

In 2024 alone, total lending turnover will reach VND 119,507 billion, with 2,321 thousand poor households and other policy beneficiaries receiving loans; total outstanding debt by the end of 2024 will reach VND 367,631 billion, an increase of VND 35,708 billion (+10.8%) compared to 2023 with nearly 6,890 thousand customers with outstanding debt. Total overdue debt and debt forbearance of the whole system is VND 2,050 billion, accounting for 0.56% of total outstanding debt.

In 2024, social policy credit capital supported investment in production and business, creating jobs for more than 712,000 workers, of which more than 9,300 workers went to work abroad for a limited period and nearly 7,000 people who had completed their prison sentences found jobs; helped more than 88,500 students in difficult circumstances borrow money to study; built nearly 1,760,000 clean water and sanitation works in rural areas; Building 1,143 houses for poor households to stabilize their lives, more than 6,200 social houses for low-income people... The impressive figures on total loan capital and the participation of millions of poor households and policy beneficiaries are clear evidence of the effectiveness of these programs, contributing to economic stability and development, ensuring social security, successfully implementing the task of preferential credit investment in national target programs for sustainable poverty reduction, new rural construction and socio-economic development in ethnic minority areas.

In addition to the above major tasks, in recent years, the Government and the Prime Minister have assigned the VBSP a number of important tasks such as: Credit policy to support people and businesses affected by the Covid-19 pandemic according to Resolution 68/NQ-CP of the Government, supporting loans for 1,548 businesses/employers affected by the Covid-19 pandemic with an amount of VND 4,829 billion to pay salaries for over 1.2 million workers to help businesses recover production; implementing the Socio-Economic Recovery and Development Program according to Resolution No. 43/2022/QH15 of the National Assembly, Resolution No. 11/NQ-CP of the Government...

From the achieved results, Governor of the State Bank and Chairwoman of the Board of Directors of the Vietnam Bank for Social Policies Nguyen Thi Hong highly appreciated the activities of the Vietnam Bank for Social Policies. In the context of the economy still facing many challenges both domestically and internationally, the Vietnam Bank for Social Policies system has made efforts to overcome difficulties while ensuring good credit quality; at the same time, resolutely organizing and implementing policies quickly and promptly to beneficiaries, contributing to stabilizing and developing the economy, ensuring social security, successfully implementing the task of preferential credit investment in the National Target Programs on sustainable poverty reduction, building new rural areas and developing the socio-economy in ethnic minority and mountainous areas.

Deputy Prime Minister Ho Duc Phoc highly appreciated and affirmed that the VBSP is one of the important “pillars” in the system of poverty reduction and social security policies in Vietnam. The VBSP plays a key role in supporting the poor and other policy beneficiaries, ensuring that no one is left behind. With its innovative operating methods and increasingly improved organizational structure, the VBSP has improved its professionalism and efficiency in serving the poor and other policy beneficiaries.

The People's Credit Fund brings policy credit to the grassroots to serve people's needs.

Improving the effectiveness of policy credit in the new period

Governor of the State Bank of Vietnam Nguyen Thi Hong, who is also Chairwoman of the Board of Directors of the VBSP, emphasized that the VBSP’s activities have always received attention from the Party, the State and the Government leaders; achieved many important results, and have been recognized and highly appreciated by competent authorities and especially the masses. The VBSP is a typical microfinance provider in Vietnam, internationally recognized for its contribution to helping Vietnam achieve the Millennium Development Goals ahead of schedule. Especially in reducing poverty, increasing access to education and healthcare for vulnerable groups, and ensuring social security for all classes of people.

Suggesting development orientations in the coming time, Deputy Prime Minister Ho Duc Phoc requested the VBSP to diversify capital sources, especially "cheap" capital sources to serve poor and near-poor households and policy beneficiaries. In particular, it is necessary to continue to improve efficiency, research and expand the form of receiving entrusted capital not only from localities but also from enterprises and corporations... The Deputy Prime Minister requested the VBSP to continue to research and promote the application of information technology, digital transformation, big data... to improve the operational efficiency of the entire system, best serving the poor and policy beneficiaries.

To promote the role and fulfill the assigned tasks, Governor of the State Bank and Chairwoman of the Board of Directors of the Vietnam Bank for Social Policies Nguyen Thi Hong suggested that in the coming time, the entire system of the Vietnam Bank for Social Policies continue to advise Party committees and authorities at all levels to implement the direction of the Central Party Secretariat in Directive No. 39-CT/TW on improving the effectiveness of social policy credit in the new period; Continue to promptly and effectively implement Resolution No. 111/2024/QH15 of the National Assembly on a number of specific mechanisms and policies to implement the National Target Programs; Well perform the tasks in the Vietnam Bank for Social Policies Development Strategy to 2030, including implementing the implementation plan of the Board of Directors and the action program of the General Director. At the same time, organize a preliminary review of the implementation progress of the Strategy at branches of the VBSP in provinces and cities, ensuring the completion of the set targets, especially the target of capital entrusted from the local budget by 2030 accounting for 15% of total capital.

Regarding capital sources, to direct units in the system to actively and proactively receive and mobilize capital sources, including promoting the receipt of entrusted capital from local budgets, receiving 2% deposits from state-owned credit institutions; Social Policy Bank branches in provinces and cities focus on mobilizing deposits from organizations and individuals in the market,... to promptly meet the capital needs for disbursement of policy credit programs, ensuring liquidity of the entire system. In addition, closely coordinate with local Party committees, authorities, and entrusted socio-political organizations to synchronously implement solutions to consolidate and improve credit quality in the entire system.

Clearly aware of the digital transformation trend in the financial sector, the Chairman of the Board of Directors also requested the Bank for Social Policies to focus on digital transformation, implementing key projects to provide comprehensive financial and banking products and services to the Bank for Social Policies' customers, optimizing financial services to help people access capital more quickly and effectively; strengthening communication work on social policy credit and the Bank for Social Policies' operations... "The Board of Directors of the Bank for Social Policies is determined to lead and direct the implementation of solutions suitable to the characteristics of the service objects to improve the management and operation efficiency of the Bank for Social Policies; promote the application and digital transformation in professional activities, best serving the poor; continue to review and build a reasonable and effective organizational structure...", the Chairman of the Board of Directors of the Bank for Social Policies affirmed.

With determination and the right development strategy, in the coming time, the VBSP will not only help millions of poor people and policy beneficiaries escape poverty, but also make important contributions to promoting economic development, social stability and improving the quality of life for all classes of people, especially the disadvantaged and remote areas. Thereby, the VBSP continues to affirm its role as an indispensable "pillar" in the national financial system, a solid foundation to ensure comprehensive and sustainable development.

Source: https://thoibaonganhang.vn/day-manh-chuyen-doi-so-nang-cao-hieu-qua-tin-dung-chinh-sach-de-phuc-vu-tot-nhat-cho-nguoi-ngheo-162036.html