Micro-credit programme improves living standards of HCM City’s poor

At a meeting o­n Saturday to review its working, managing director of the Capital Aid Fund for Employment of the Poor (CEP), Nguyen Thi Hoang Van, said the number of poor people getting micro-credit from CEP had risen from 792 in 1992 to 68,000 this year.

The total amount of loans in the period had increased from VND460 million (US$30,000) to VND190 billion ($12 million).

Founded in 1991 and based o­n Bangladesh’s Grameen Bank – whose founder Mohammed Yunus recently won the Nobel Prize for peace – CEP is a non-profit government organisation operating under the HCM City Labour Confederation.

Van said: "CEP’s mission is to work with, and for, the poor, to realise sustainable improvements in their well-being through the provision of financial and non-financial services."

For 15 years it has received financial support from government and non-government organisations including AusAID, the Belgium-based Co-operation Internationale pour le Developement et la Solidarite (CIDSE), the Ford Foundation, the Senegal-based Environment and Development Action for the Third World (ENDA), the French organisation Solidaritel Internationale pour le Developement et l’Investissment (SIDI), and the World Bank. Van said Australia’s AusAID had made the biggest contribution to CEP’s micro-credit services in HCM City.

In June 2005 the New York City-based Ford Foundation signed an agreement with CEP to donate $402,000 for a project to expand its services. It comprised of $393,500 for small loans to poor residents and $8,500 to make organisational changes within the fund.

Gender equality

The Ford Foundation’s representative in Thailand and Viet Nam, Dr Charles Bailey, noted that CEP was the largest of some 55 micro-credit programmes outside the state sector in Viet Nam.

It has 17 branches in HCM City. In addition to small credit to help poor people start businesses, CEP also provides loans for housing repairs and for getting access to electricity, water supply, and health care.

It gives 80 per cent of its loans to women. "Gender equality is still severely skewed. By targeting [women], offering them employment opportunities, CEP aims to enhance their status in their family and within the community," deputy director Vo Van Truong explained.

Loans ranged from VND1 million ($65) to VND7 million ($450) for terms lasting three to 15 months, he said.

Chairman of HCM City Labour Confederation, Nguyen Huy Can, said: "With CEP’s micro-credit and the sweat of their brow, many clients have escaped poverty."

Van said in the next five years CEP would expand its services in HCM City and open seven new offices in Dong Nai, Binh Phuoc, Can Tho, Tien Giang, Binh Dinh, and Quang Ngai provinces.