Practical ways in villages and hamlets
After attending the meeting of the Loan Group in Bo An hamlet, Hung Tien commune (Nam Dan), we visited the house, which is also the place where Mr. Nguyen Van Vinh and his wife use as the address for their oil pressing service business.
Introducing the house and the rather large garden, Mr. Vinh said that after nearly ten years of agricultural production, combined with the business of pressing peanut oil and sesame oil, he and his wife have just renovated the house to be more spacious. Nam Dan is a locality with a long history of agricultural production, Mr. Vinh's family as well as the households in Hung Tien commune are also attached to living mainly by farming. However, to raise 2 children to study, especially both of them go to university, they also rely on the business of pressing oil, retailing and importing peanut oil and sesame oil for shops and agents.
Mr. Vinh expressed that 9 years ago, realizing that the local agricultural resources, especially peanuts and sesame, were quite abundant, along with the high market demand for cooking oil pressed from peanuts and sesame, the couple discussed trying to add another business field to take advantage of this precious raw material. He boldly borrowed money from friends and borrowed capital from the district's Social Policy Bank to buy a peanut oil press for more than 100 million VND.
Every day, Vinh and his wife take turns buying peanuts and sesame from people in the commune and district to roast and operate the press to produce peanut oil and sesame oil for the main shops in the district and to serve the needs of people in the area. On average, each year, Vinh's production facility imports about 30 - 40 tons of raw materials, mainly peanuts, to process peanut oil.
After several years of doing business and paying off bank loans, in 2021, the couple saved up capital to invest in a new press machine worth more than 240 million VND, which gives a higher oil yield and drier pressed peanut and sesame residue. At the same time, he bought an additional agricultural dryer to help reduce a stage of pressing seeds.
“Whether peanuts, sesame, or beans, they all need to be roasted before pressing, which helps the oil to be fragrant and delicious and can be preserved for a long time. In recent years, thanks to the production and business loan program of the Social Policy Bank, we in the Bo An hamlet loan group were able to borrow 120 million VND with preferential interest rates. Working and paying off the debt, after more than a year I have paid 50 million VND, now I still owe 70 million VND, striving to pay it all off by the end of the year” – said Mr. Nguyen Van Vinh.
Ms. Phan Thi Duyen - Head of the Loan Group of Bo An hamlet said that Mr. Vinh is one of the households that effectively utilizes the loan capital. In addition, many other households, thanks to preferential interest rate loans from the Social Policy Bank, also operate effectively to invest in raising buffaloes, cows, fish, buying machinery such as tractors, trucks to increase the efficiency of agricultural production, and doing business in transportation services. Currently, the Loan Group of Bo An hamlet has 29 members, with an outstanding debt of more than 1.7 billion VND.
Mr. Nguyen Van Hai - Director of Nam Dan District Social Policy Bank said: Following the direction, we have coordinated well with the District and Commune-level Trustee Associations to deploy the construction of a network of savings and loan groups in a sustainable manner associated with community activities. Up to now, 31 groups have been established and put into operation. The groups have organized activities very systematically from the stage of scripting, activity content, participation of meeting participants, especially the groups all have the participation of leaders, district credit officers, District-level Associations, leaders of the Commune People's Committee, Party Committees and heads of villages in the commune, and group leaders from other villages come to study. After being established and put into operation, the groups maintain quarterly activities.
In Dien Chau district, thanks to the good performance of regular group activities according to the process, by February 29, 2024, Dien Chau District Social Policy Bank had built 37 sustainable savings and loan groups operating closely with community activities, meeting the criteria set by the bank, such as having more than 50 members, the group's outstanding debt reaching 2 billion VND or more, the group having no overdue debt, 100% of group members paying interest and participating in savings fully according to the operating convention.
Continue to expand
The network of Savings and Loan Groups is constantly being consolidated, improved and the quality of operations improved throughout the province, contributing significantly to improving the quality of policy credit activities.
Currently, in Con Cuong, there are many groups operating regularly and cohesively. Members of the Savings and Loan Groups actively support disadvantaged households to effectively utilize loan capital. Ms. Lu Thi Khuyen - President of the Con Cuong District Women's Union said that through the activities of the savings and loan groups associated with community activities, the economic development loan models of women's union members have been effective, with no bad debts. From the loan capital, women in Con Cuong District have had more opportunities to participate in local economic development, especially in livestock farming and community tourism; many women have risen to become well-off and written applications to escape poverty. If there is a case in the group that is at risk of not paying interest on time, other group members will contribute to help that member pay interest on time and contribute savings on time.
Building sustainable savings and loan groups associated with community activities gradually solves the limitations of the current network of groups. These include the lack of connection between group members, the low responsibility of group members to the group management board and vice versa, the limited evaluation of subjects, and the low efficiency of capital management...
Regular group meetings have helped capital management become more and more effective, without credit risks. Through group meetings, the Group Management Board grasps the situation, conditions, and circumstances of each household so that when capital is transferred, a meeting can be held to consider lending. At the same time, promote the dissemination and propaganda of the Party and State's policies and guidelines on policy credit, coordinate with functional agencies to effectively integrate capital lending and technology transfer, replicate sustainable poverty reduction models, and commend typical households with good economic performance. In addition, combining community activities such as cultural and sports exchanges helps to improve the cultural life of the people.
However, in reality, at the grassroots level, there are still limitations and difficulties in implementing this model. Mr. Nguyen Van Hai - Director of the Social Policy Bank of Nam Dan district said: We have reviewed and analyzed to propose support plans for the group to achieve 8/8 criteria according to the orientation. However, some groups have completed 7/8 criteria, but the criterion on credit scale is difficult to achieve. The reason is that the lending subjects in the block and hamlet are increasingly narrowing, while the demand for loans is still large, the source of loans for job creation is not enough to meet the demand. Community activities lack funds to maintain regularly with appropriate scale.
In addition, in some localities, the written regulations are not strict, leading to the lack of a systematic way of operating and organizing the groups, which partly affects the quality and effectiveness. In some localities, community activities are not clear, relatively similar, many groups do not have outstanding characteristics, so the number of participating members is still small...
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