Ha Noi's Social Policies Bank director, Nguyen Kim Phung, spoke with Thoi bao Ngan hang (Banking Times) newspaper about the impact of preferential loans for social welfare beneficiaries and the poor.
Can you review what the bank has achieved in helping social welfare beneficiaries and the poor during the past decade?
The bank has covered 559 out of the city's total 577 communes and wards over the past 11 years. Preferential loans have been provided to nearly 1 million low-income households and beneficiaries of social welfare, including 575,000 poor households.
Loans have helped over 150,000 households escape from poverty, created jobs for 370,000 labourers and provided loans for more than 120,000 students with financial difficulties.
It has resulted in more than 200,000 clean water and environmental hygiene facilities, and over 7,200 houses for low income families were built thanks to the support of the bank.
By the end of October 2013, total outstanding loans, spanning over 11 programmes, had reached VND 4,185 billion (approximately US$199.2 million), a rise of VND 191 billion ($9.1 million) compared to the previous year.
The bank has been a unit with good quality loans and a low rate of overdue debts, at VND12.7billion ($600,000) or 0.3 per cent of total outstanding debts.
The loans have achieved many social-economic results that contributed to urban and political stability and to social welfare.
How did the bank provide preferential loans to the city's low-income households?
In order to implement the Government Decision 15/QD-TTg on loan policies for the poor, we actively directed our branches to target disbursements for the needy.
By end of October 2013, total outstanding loans for these households had reached more than VND380 billion ($18 million), equivalent to nearly VND50billion ($2.38 million) per month, meeting the given targets.
Thanks to the overall implementation of measures to mobilise human and material resources, more than 20,000 struggling households have accessed loans for business development, job creation and the improvement of living standards.
How do you evaluate results of the bank's programme on loans for students in the city?
By October 31 2013, outstanding loans for students had reached VND859 billion, a decline of VND142 billion ($6.76 million) compared to beginning of this year.
Statistics showed that the implementation and debt repayment from students was pretty good. Many have settled their debts before the due dates, while some have faced difficulties and some graduates who haven't had job, extended their debt deadline.
A few years ago, we had faced difficulties in accessing capital sources. However, capital sources were available for the programme during the previous two years ensuring all students who met conditions could borrow loans for their study.
In the 2013-14 school year, the annual cap for loans for students increased to VND11million ($520) per student.
The bank is scheduled to disburse around VND50 billion ($2.38 million) in the first term of this school year and there is enough money for the student loans.
Demand for job creation in the city is a difficult problem to solve, does the HSPB face pressure in providing loans for job creation?
By the end of October 2013, outstanding loans for job creation had reached VND1,010 billion ($48million) benefiting 48,000 customers and meeting 99 per cent of the year's target.
The yearly capital sources for job creation loans was low and didn't meet the increasing demand from localities, especially traditional trade villages and industrial areas.
We asked the municipal People's Committee to allocate an additional VND120 billion of trust capital to the HSPB's fund for job creation for beneficiary of social welfare in 2014.
In addition, the HSPB also asked the city to consider adding another category of trust capital (VND200 billion) to fund households who recently jumped out of poverty and would benefit from ongoing support to ensure they would not slip backwards, an initiative aiming to firmly reduce the poverty rate in the city. — VNS