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VietNamNews

Poor workers to get small loans

Update: May, 20/2013 - 09:46

HCM CITY(VNS)— The Viet Nam General Confederation of Labour has proposed expanding a HCM City-based microfinance fund to help more poor households take out low-interest loans, according to Mai Duc Chinh, deputy head of the conference.

Although the Capital Aid Fund for Employment of the Poor provides small loans averaging VND7 million (US$337) each to millions of poor households, it can meet only 15-20 per cent of demand, said Chinh.

The fund needs more than VND3 trillion (US$144.2 million) from the State budget to provide credit to more than 450,000 poor workers, he said at a workshop held on Tuesday in HCM City.

The confederation is working with the Ministry of Finance on the microfinance expansion proposal, which will be submitted to the Prime Minister for approval.

It targets increasing the number of borrowers by 300,000-400,000 during the 2013-2018 period. It also hopes to establish 40 branches by 2018.

Founded in 1991, the fund has provided credit worth VND10.5 trillion (US$ 505 million) to 1.7 million borrowers, with women accounting for 75 per cent.

Last year, the fund provided credit to 208,000 active borrowers at a monthly interest rate of 0.9 per cent.

Nearly half of all loans are used for trading activities. Loans are also used for housing and sanitation improvement, agricultural cultivation and animal breeding as well as healthcare.

The fund, which is under the HCM City Labour Confederation, operates in the Cuu Long (Mekong) Delta and southeastern provinces. —VNS


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