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VBSP's target customers are the poor and other disadvantaged groups, with a priority on enabling and improving women's access to financial services.
Currently, VBSP serves 6.5 million household customers, with the majority living in remote and rural areas and 4.3 million (66.2 per cent) of whom are female customers.
To facilitate access to financial services for poor women, the bank has collaborated with local mass organisations to establish over 180,000 savings and credit groups. Women account for 55 per cent of savings and credit group leaders.
VBSP's borrowers are concentrated mainly in the rural, ethnic minority, and mountainous areas with the purpose of poverty reduction, job creation, economic development, income generation, and life quality improvement for the people and specific target groups such as ethnic minorities, unemployed workers, or women to contribute to the promotion of gender equality in policy credit activities.
At the end of 2019, VBSP served 4.3 million women with outstanding loans of VND108.834 trillion ($4.73 billion), accounting for 53.2 per cent of the total loan portfolio.
As for credit programmes for poverty reduction, such as programmes for poor households, near-poor households, or housing for the poor, there are 1.72 million female clients with the outstanding loans of VND54.871 trillion ($2.39 billion), up VND2.08 trillion ($90.43 million) compared to the end of 2018.
As for job creation programmes, there are 345,000 female customers with the outstanding loans of VND12.364 trillion ($537.57 million).
As for other credit programmes, such as those to support extremely disadvantaged ethnic minority households, loans for husbandry and forest development, clean water and rural sanitation, or programmes earmarked for business and production households living in extremely disadvantaged areas and communes, there are 2.24 million female customers with the outstanding loans of VND41.598 trillion ($1.8 billion).
The average outstanding loans of female customers in 2019 were VND25.2 million ($1,095), an increase of VND2.6 million ($113) compared to 2018.
Overdue and frozen debts accounted for 0.7 per cent of the total outstanding loans, serving 6.5 million poor households.
Since 2016, VBSP has collaborated with the Vietnam Women’s Union to hold over 30,000 training-the-trainer classes for group leaders and union staff, who then trained women clients about finance and banking, loan management, borrowing procedures, and financial literacy.
Below are a handful of customer success stories:
1. H’Giang is the leader of a savings and credit group (SCG) with 58 members, borrowing nearly VND3 billion ($130,430) from VBSP in Dak Glong district to plant forests, cultivate industrial plants, as well as raise livestock and poultry in order to produce profit, increase income, and improve living conditions.
Since the day H’Giang became the group leader, the average rate of households escaping from poverty every year reached 3 per cent, while the living conditions of many households have improved. In the past five years, the group has not reported overdue debts or outstanding interest. Moreover, in the first quarter of 2019, the group had the highest savings deposit in Dak Glong district.
|H’Giang, head of savings and credit group of Village 2, Dak Som commune, Dak Glong district, Dak Nong province|
As a group leader, H'Giang cleverly instructs other members to promote the state's credit policies and VBSP’s activities.
“I often visit our members' homes to check how they use their capital. If there are any difficulties, I will try to find a way to help them, otherwise, I will submit a report to the commune authorities for help," H 'Giang said. Her enthusiasm has brought trust and connected members, creating a sustainable "bridge" for VBSP to get closer to the poor in the Central Highlands.
2. In 2012, H’Jer was elected by her village as a leader of the SCG managed by the Women's Union. At that time, people in the village were still beset by many difficulties. People mainly lived from farming. Due to the lack of capital and technology, many households worked on the farms but their income was quite low. As a group leader, she visited every household to mobilise people to join her SCG to access financial inclusion services and begin more active production and business.
|H’Jer (middle) always shares the difficulties of group members|
H’Jer frequently meets and talks with the poor. She also helps households quickly access capital from VBSP. She treats group members as her family members. Therefore, she always discusses and advises members ways to repay principal and interest on time and get profit when receiving loans from VBSP, making sure their life improves in the process.
She was happy to see so many households escape poverty thanks to VBSP's inclusive financial services. Thanks to her efforts, for many years now, the SCG has had no overdue debt or outstanding interest.
Up to now, the group has attracted nearly 50 members with a loan balance of more than VND1.6 billion ($695,570). Especially, thanks to VBSP’s capital and the efforts to advise people to use the capital for the right purposes, many group members have escaped poverty and now have a stable life.
3. Nguyen Thi Phuong of Village 10, Phuc Son commune, Anh Son district, Nghe An province is also an example of overcoming difficulties thanks to VBSP’s financial inclusion service. Since losing her husband to a sudden illness, she became the main breadwinner of the family, working as a hired labourer without managing to improve her living conditions. Her children were also at risk of dropping out of school due to money constraints.
|Nguyen Thi Phuong standing at her tea field grown by using VBSP capital|
Thanks to the enthusiastic guidance of the head of her savings and credit group, in 2013, she borrowed VND30 million ($1,300) from a credit programme earmarked for poor households from VBSP in Anh Son district.
She invested immediately in raising pigs and cows. Gradually, her family got better. After making a profit, she continued to invest and turned 2,500 square metres of her family's hill garden into a fish pond and tea plantation.
Thanks to the application of science and technology in animal husbandry and cultivation, each year, she makes a tidy profit from raising pigs, planting tea, and raising fish. At the beginning of 2017, she escaped from poverty and repaid VBSP in full.
In mid-2017, she bravely borrowed VND50 million ($2,170) from VBSP’s lending programme earmarked to support production and business households living in disadvantaged areas and communes, she invested into planting acacia and green tea on 5ha.
“VBSP's inclusive finance helped my family have an acacia forest, lush green tea hill, eight cows, and fish ponds so my family's life is getting better now," said Phuong.