Superior method for sustainable poverty reduction

The method of entrusting policy credit loans through the system of associations and unions in the province over the past years has affirmed the unique superiority of the Bank for Social Policies. This is a creative way, consistent with the principles and purposes of the activities of associations and unions as well as the goals of the banking sector in the process of creating equal development between regions, improving the lives of poor households, actively contributing to the goal of sustainable poverty reduction and new rural construction set forth by our Party and State.

Credit officers of the Social Policy Bank of Phu Tho town discussed with mass organizations about the progress of digital application implementation in the preferential loan program for poor households.

Affirming unique superiority

Huong Lung is a mountainous commune in Cam Khe district with Catholics accounting for 95% of the total population. In recent years, through local socio-political organizations, preferential loans have reached poor households, policy households and those in need of loans. Thanks to policy loans, the lives of many households have been improved, gradually changing the economic face of this commune with many difficulties.

Ms. Nguyen Thi Huyen - Chairwoman of the Commune Women's Union shared: The Commune Women's Union has coordinated with the District Social Policy Bank to effectively organize the trust service of lending capital to poor households and other policy beneficiaries in the commune. After signing the trust contract, the Women's Union as well as other mass organizations have focused on disseminating the Party and State's preferential policies and guidelines to the people. Thereby ensuring that the loan capital reaches the right beneficiaries, promptly and effectively. Currently, the Commune Women's Union is implementing 10 lending programs with an outstanding loan of nearly 9 billion VND, 191 members still have outstanding loans.

With the responsible and effective participation of the Party Committee, government, especially mass organizations, Huong Lung commune has said no to bad debt, frozen debt and overdue debt for many years.

Through research, it is known that the trust activities of mass organizations in Cam Khe district have facilitated the poor and other policy beneficiaries to access capital sources and reduce costs. Currently, the organizations are closely coordinating with the Social Policy Bank to implement the trust contents, coordinate the management and disbursement of 14 policy credit programs, the trust balance reached 678 billion VND, accounting for 99.9% of the total outstanding balance.

To make policy credit activities highly effective, the Vietnam Bank for Social Policies has implemented a special lending method through coordination with Party committees, authorities, and grassroots organizations and unions in identifying beneficiaries, disbursing and managing capital sources, in which the role of grassroots organizations and unions is the main focal point at the grassroots level. This method is implemented publicly and democratically in the community.

Through a wide network from the provincial level to communes, wards and towns, associations and unions have promptly grasped the thoughts and aspirations of their members, quickly bringing capital to the beneficiaries. The loan evaluation is carried out under the witness of the association organization receiving the trust at the commune level and the head of the residential area. The associations have promoted their supervisory role in evaluating and selecting loan recipients, supervising borrowers in using capital, promptly detecting and coordinating the handling of cases that can easily lead to the risk of losing capital. In addition, the association organization also actively coordinates with functional units in urging borrowers to repay debts when due, urging the collection of overdue debts in the management area...

The Women's Union of Huong Lung Commune (Cam Khe District) coordinated with the Savings and Loan Group of Suong 1 area to review the list of members eligible for preferential loans to guide them in preparing preferential loan applications.

Promoting credit growth

The coordination in implementing the entrustment between the Social Policy Bank and organizations and unions is carried out closely and synchronously, thus the quality of entrustment is increasingly improved.

Borrowing capital through associations plays an important role and accounts for a large proportion of outstanding loans of the Bank for Social Policies. Tam Nong is one of the localities that effectively promotes the entrustment role of associations and unions. The district Bank for Social Policies has entrusted 48 associations and unions at the commune level, including 12 Farmers' Associations, 12 Women's Associations, 12 War Veterans Associations and 12 Youth Unions. The entrusted associations and unions are managing 237 Savings and Loan Groups. The total outstanding loan entrusted through associations and unions is over 439 billion VND, accounting for 99.95% of the total outstanding loan. Of which, the Farmers' Association has a trust debt balance of nearly 130 billion VND, the Women's Association has a trust debt balance of over 127 billion VND, the War Veterans' Association has a trust debt balance of over 104 billion VND, and the Youth Union has a trust debt balance of over 78 billion VND.

In order to improve credit quality, the Bank for Social Policies actively coordinates with local authorities, entrusted organizations and Savings and Credit Groups to review and classify each overdue debt and overdue debt to have appropriate measures to handle and recover debt; at the same time, grasp well the difficulties and problems of borrowers to promptly overcome them. Up to now, the overdue debt ratio accounts for 0.1% of the total entrusted debt balance.

Currently, the system of the Social Policy Bank in the province has been entrusting through 845 commune-level organizations and unions, of which the Farmers' Association has 213 organizations, the Women's Association has 221 organizations, the Veterans' Association has 212 organizations and the Youth Union has 199 organizations. Up to now, the total outstanding debt entrusted through associations and unions has reached over 6,580 billion VND, accounting for 99.69% of the total outstanding debt of the entire branch. Of which: the Farmers' Association has an outstanding debt entrusted to over 1,807 billion VND, the Women's Association has an outstanding debt entrusted to over 1,831 billion VND, the Veterans' Association has an outstanding debt entrusted to nearly 1,528 billion VND, and the Youth Union has an outstanding debt entrusted to over 1,414 billion VND.

Socio-political organizations in the province have really promoted their role in receiving entrusted policy credit capital. That not only helps poor and near-poor households and other policy beneficiaries have conditions to develop production, create jobs, and stabilize their lives, but is also a tool to help members and low-income families enjoy equality in education and social security. In 2024, through entrusted activities, 34,639 poor households and other policy beneficiaries had access to capital; nearly 4,000 workers had jobs, 79 policy beneficiaries were able to buy social housing or repair houses to live in; nearly 100 workers borrowed capital to work abroad; 664 students in difficult circumstances received loans for study; 120 families with people who had completed their prison sentences received loans; built and renovated nearly 39,800 clean water and rural environmental sanitation works.

It can be seen that the direct lending method with entrustment at some stages through local organizations has created an effective and reliable capital channel for the people and Party committees and authorities, helping the poor and policy beneficiaries change their awareness to escape poverty.

Comrade Truong Viet Phuong - Director of the Provincial Social Policy Bank Branch affirmed: The implementation of capital entrustment through associations and unions not only effectively implements the policy of socializing policy credit activities, mobilizing the strength of the whole society to participate in improving the efficiency of using State resources for the goal of poverty reduction, ensuring social security in the locality, but also is an extension for policy credit capital to reach the right subjects and promote efficiency, contributing to consolidating and enhancing the reputation of associations and unions at the grassroots level. Associations and unions have the conditions to pay more attention to their members, the content of activities is richer, contributing to reducing social costs, helping poor households and other policy beneficiaries access financial services quickly, conveniently, safely and effectively.

Phuong Thao

Source: https://baophutho.vn/phuong-thuc-uu-viet-giup-giam-ngheo-ben-vung-230805.htm