Effective capital channel for the poor and low-income people

In recent years, Microfinance (MF) has been considered an effective tool in the strategy of hunger eradication and poverty reduction in developing countries, including Vietnam. It does not simply provide loans, but also helps poor and low-income customers have the opportunity to directly access financial and non-financial services to improve their lives and escape poverty. Above all, MF loans help customers improve their capacity, confidence, and gradually affirm their role and position in their families and society.

Effective capital channel for the poor and low-income people Ms. Do Thi Chanh (Quang Nham commune, Quang Xuong) has effectively used loans from Thanh Hoa Microfinance Organization from 2007 to present.

From the reputation and responsibility of the service provider...

Also operating in the credit sector, the operating methods, missions, and goals of TCVM in general are very different from those of other credit institutions. In addition to its function as a financial intermediary, through the method of creating lending groups or training knowledge, transferring techniques... in the community, TCVM has become a social intermediary, a development tool for the poor and low-income people. This is considered an important pillar towards comprehensive financial development in Vietnam, thereby actively contributing to hunger eradication, poverty reduction, and comprehensive and sustainable economic development of Vietnam.

Formed and developed in that common "flow", Thanh Hoa Microfinance Organization always upholds the spirit and responsibility, constantly strives and strives for community development. In order to have more and more poor, low-income and disadvantaged households access to "close, friendly and effective" financial services, the organization's leadership, staff and employees have developed a variety of basic financial products and services suitable to conditions, circumstances and actual needs such as micro loans, savings products, micro insurance products... Along with that, focusing on expanding the area of operation to remote, isolated and particularly difficult areas through many practical and effective activities.

In order to support customers to access and use basic financial products and services conveniently, Thanh Hoa Microfinance Organization has many innovations, flexibility, and creativity in the approach and organization of distribution channels. On the one hand, Microfinance officers directly meet, promote and introduce products and services to customers or through the Women's Union and local authorities. On the other hand, Thanh Hoa Microfinance Organization applies technology (via tablets and smartphones) to register loan customer information through the CCS software subsystem and online savings app to transact with customers who deposit savings right at the village cultural house with the smallest deposit amount, customers can deposit regularly without incurring travel costs.

When borrowing capital from Thanh Hoa Microfinance Organization, customers regularly participate in seminars, training sessions, personal financial education consultation, loan methods - loan usage and savings consultation... From there, customers are not only provided with "fishing rods" but also have the opportunity to update, acquire knowledge, improve understanding, awareness, and confidently embark on the journey to escape poverty and build a life.

...to the will to rise of the borrower

Nearly 14 years of borrowing capital from Thanh Hoa Microfinance Organization is a long journey with many efforts to escape poverty, affirming the self-worth of Ms. Do Thi Chanh (62 years old, Bac village, Quang Nham commune, Quang Xuong). In a house filled with the voices and laughter of her children and grandchildren, recalling the difficult years that have passed, she could not help but feel sad and emotional, confiding: "Life is inherently difficult, people with husbands and wives still have many difficulties, let alone a single mother raising two children of school age".

Every day, she struggles to make a living by selling seafood. Because of her hard-working, energetic and enthusiastic nature, she was loved and trusted to be elected as the President of the Women's Association of Bac village. Although her life is full of difficulties, she always tells herself to be optimistic and try hard for herself and her children. In 2007, she learned about Thanh Hoa Microfinance Organization and decided to participate in a loan with a limit of 3 million VND after carefully researching and listening to advice. She said: "Procedures such as disbursement and collection of capital are carried out by credit officers of Thanh Hoa Microfinance right at the village cultural house. Officers of the organization come to households in need of loans to advise and guide them in completing the application. In particular, customers do not need to pay any fees to receive capital."

With that loan, Ms. Chanh was able to import more goods and expand her business. Over the years, her work became more and more favorable, her children gradually grew up, and her life became less worried. When she was "old" and had some capital, she no longer "ran to the market" every day like before, but bought 3 large capacity washing machines to open a laundry shop. The income from the laundry shop may not be as good as the business, but it is less difficult and tiring.

It is known that Bac village (Quang Nham commune) has 64 members participating in borrowing capital from Thanh Hoa Microfinance Organization. Ms. Chanh shared: “Not only is the lending method flexible, suitable for customers, but Thanh Hoa Microfinance Organization also has a very good form of loan recovery, in the style of "borrowing a basket, paying back each bucket" - borrowing once and paying back gradually over many months. Borrowers like us not only find it easy to borrow, easy to pay, but at the end of the loan cycle, we have a small amount of savings. Therefore, we are very confident, seeing it as an opportunity for our future”.

Borrowers often exchange experiences and help each other in life. In their stories, members always express their gratitude to Thanh Hoa Microfinance Organization for creating conditions for women to borrow capital, giving them more motivation and confidence to rise up in life.

Ms. Le Thi Thuy in Thieu Toan commune (Thieu Hoa) borrowed capital from Thanh Hoa Microfinance Organization in 2011 with a limit of 6 million VND. For a woman who had just come to a foreign land as a daughter-in-law, whose income only depended on a small stall selling clothes at the market, her husband was a freelancer, and her young child was constantly sick, that amount of money was really a "support" for Ms. Thuy to calculate how to use it effectively, not wasting opportunities. From her knowledge and experience in selling clothes and fabrics, she boldly "started a business" by opening a small tailor shop. Thanks to her expertise, diligence, enthusiasm for customers, and quality products, the tailor shop has more and more customers, with a good income.

Seeing the opportunity for development, she did not hesitate to "put all her efforts" into investing in expanding the scale of her profession. From a small tailor shop, she built a sewing workshop of dozens of square meters, invested in machinery, hired workers... From a woman who had to struggle and struggle in a myriad of difficulties, up to now, she has not only risen to become an owner but also created jobs for dozens of workers with a salary of 3 - 5 million VND/month. Ms. Thuy shared: "If it weren't for the loan capital from Thanh Hoa Microfinance Organization, I would never have thought I would have achieved the results I have today."

It can be seen that the contributions of Thanh Hoa Microfinance Organization in sustainable poverty reduction do not stop at the story of “fish” or fishing rod. Thanh Hoa Microfinance Organization has written with tens of thousands of its customers the journey of overcoming fate with the most authentic and vivid evidence.

Article and photos: Hoang Linh

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