TRÀ VINH — Preferential loans from Việt Nam Bank for Social Policies have been proved effective in helping poor people in southern province of Trà Vinh to imporve their lives.

Quỳnh Minh Nhân, chairman of Hiệp Mỹ Đông Commune People’s Committee in the province’s Cầu Ngang District said that preferential loans played an important role in reducing the poverty rate in the commune, from over 10 per cent in 2014 to just 4 per cent at present.

He said that as soon as poor families received the bank loans, they were instructed to spend the money effectively, for example, investing in developing shrimp or cow farms.

Phan Văn Oanh, chairman of Lương Hòa Commune, Châu Thành District said that the commune used to be especially disadvantaged, with a poverty rate of 29 per cent.

Thanks to preferential loans, local people had money to start businesses, according to Kinh tế Nông thôn (Farming Economy) newspaper.

Local authorities encouraged farmers to grow two rice harvests, as well as vegetables throughout the year to increase productivity.

The vegetables helped generate up to VNĐ 100 million (US$4,400) per hectare every year, five times higher than rice production, he said.

Oanh said that when a production model was introduced to local people, the local authorities offered training classes to ensure they could employ it effectively.

“With a proper understanding and farming technique, people could use their loans effectively,” Oanh said.

Farmer Phan Văn Nhu in Lương Hòa Commune said that for years his family was unable to escape from poverty because he had no land for growing produce.

In 2013, he borrowed VNĐ10 million ($440) from a lending programme for poor households from the Social Policies Bank, and spent it on some cows.

Last year, Nhu received a preferential housing loan, so, together with his savings, he built a new house.

“Thanks to the loans, now I have business to run, a new house to live in, and my children can go to school. Life is much better,” Nhu said.

Thạch Thành Trung, another resident in Thuận Hòa Commune, said that he also built a house with his loan, worth VNĐ100 million.

A few years ago, I borrowed VNĐ40 million ($1,750) from the bank’s programme for the poor and another VNĐ8 million from bank’s programme for people of ethnic groups to start growing peanuts, okra and rice.

Earlier this year he decided to build a house after bringing in a stable yearly income of VNĐ100 million. He also got a loan worth VNĐ25 million from the bank’s housing programme.

Trung said that his mother was so poor that she sold her land to have money to raise eight children.

Despite working hard, Trung was unable to earn enough money to get his family’s land back.

“The VNĐ40million loan from Social Policies Bank helped me to take back the land, so my family could farm it,” he said.

Vice director of Trà Vinh Province’s Bank for Social Policies Lê Hoàng Phi said that the bank was providing preferential loans to nearly 127,000 households including poor households and near-poor ones who have just escaped from poverty.

More beneficiaries can access preferential loans through lending programmes such as the programme for poor households, a programme on clean water and rural hygiene and environment, and a programme for business households in disadvantaged areas.

Trà Vinh Province now has 23,000 families, accounting for 8.41 per cent of its population, living under poverty line. Last year about 7,300 families, or 2.75 per cent of poor families, reportedly escaped from poverty. — VNS