DPM Phoc highlights VBSP's role in poverty reduction

The meeting was attended by Nguyen Thi Hong, Governor of the State Bank of Vietnam (SBV) and chairwoman of VBSP’s Board of Directors; Nguyen Thi Tuyen, president of the Vietnam Women’s Union; Phan Nhu Nguyen, vice president of the Vietnam Farmers' Union; along with other members of VBSP's board and representatives from relevant ministries and agencies.

Deputy Prime Minister Ho Duc Phoc

In his address, VBSP general director Duong Quyet Thang revealed total social policy credit sources have surpassed $16.6 billion, with an average annual growth rate of over 21 per cent. Of this, $2.35 billion is entrusted capital volume by local governments.

The outstanding balance of social policy credit schemes stands at just over $15 billion. Currently, over 6.8 million poor households, near-poor households, and policy beneficiaries still have outstanding loans with VBSP.

Over the past 23 years, nearly 48 million poor households and other policy beneficiaries have received preferential loans, helping more than seven million households escape poverty.

The bank has also created jobs for more than 7.6 million workers, supported over four million students in need, and contributed to the construction of over 20 million clean water and sanitation facilities in rural areas.

Additionally, nearly 784,000 homes for the poor and low-income households, and policy beneficiaries have been built, purchased, or rented with support from VBSP schemes.

VBSP general director Duong Quyet Thang (standing)

VBSP has been tasked with several important missions by the government, including implementing credit policies to support individuals and businesses affected by the pandemic under the government’s Resolution No.68/NQ-CP.

These efforts have provided loans to almost 1,550 businesses, amounting to $193 million, to pay wages for over 1.2 million workers and help businesses recover production.

Furthermore, VBSP has also participated in materialising economic rebound and development initiatives under National Assembly Resolution No.43/2022/QH15 and government’s Resolution No.11/NQ-CP.

During the meeting, representatives from various state management agencies such as the Ministry of Agriculture and Rural Development, Ministry of Finance, Ministry of Justice, Ministry of Ethnic and Religious Affairs, and the Government Office expressed their high consensus with reports from the SBV and VBSP.

They praised VBSP's achievements over the past 23 years, particularly in developing a modern and rational governance model, which has effectively served the target beneficiaries and contributed to maintaining and enhancing the quality of social policy credit.

The rate of overdue and suspended debts in VBSP’s whole system has decreased from 13.75 per cent of total outstanding loans when it was handed over in 2002 to just 0.55 per cent as of March 20, with overdue debt accounting for under 0.2 per cent of total outstanding loans. This reflects VBSP’s successful efforts to preserve and grow state capital.

Nguyen Thi Hong, SBV Governor and VBSP chairwoman

At the meeting, Governor Hong emphasised that VBSP’s activities receive attention from party, state, and government leaders, praising the bank for its important achievements, which have been highly appreciated by relevant authorities and the public.

"VBSP is a typical microfinance institution and has been internationally recognised for helping Vietnam achieve its Millennium Development Goals ahead of schedule," said Hong.

Concluding the meeting, DPM Phoc highlighted that VBSP is one of the 'pillars' of Vietnam’s poverty reduction and social welfare policies. Its innovative approaches and increasingly improved organisational structure have served the needs of the poor and other policy beneficiaries effectively.

Looking ahead, the DPM outlined several key tasks for VBSP, including stabilising the organisational structure to align with the current administrative unit reorganisation process.

He emphasised the importance of maintaining the client network during any restructuring. Additionally, VBSP should diversify its capital sources, especially low-cost funding.

The bank should continue to improve efficiency and explore new avenues for receiving entrusted capital not only from local governments but also from businesses and corporations.

DPM Phoc also urged VBSP to continue focusing on developing a professional and modern workforce and to enhance the application of IT, digital transformation, and big data to improve operational efficiency.

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