VBSP expands policy lending to empower marginalised communities

VBSP expands policy lending to empower marginalised communities

Vietnam Bank for Social Policies (VBSP) recorded strong credit growth and disbursement in the first five months of the year, laying the groundwork to fulfill its 2025 goal of expanding inclusive lending and supporting national development goals.

At an online conference on June 5, the Board of Directors (BoD) convened with representatives of its local-level BoD to review performance results.

As of the end of May, the total capital for policy credit programmes approximated $16.4 billion, marking a 9.2 per cent increase on-year.

Outstanding loans across policy credit programmes amounted to $15.6 billion, up 5.9 per cent on-year. Credit quality remained stable, with overdue and frozen debts maintained at 0.54 per cent of total outstanding loans.

Several key programmes have delivered strong results, notably those supporting job creation, social housing, and housing for poor families, significantly contributing to the implementation of national target programmes.

These efforts also align with the government’s objectives on social housing development and the elimination of makeshift and substandard housing.

In the first five months of 2025 alone, social policy credit enabled production and business investments that created jobs for over 404,000 people, including more than 4,500 workers placed in temporary employment overseas and nearly 2,600 rehabilitated former inmates.

The bank also supported nearly 13,400 disadvantaged students with education loans and funded the construction of over 751,000 rural clean water and sanitation facilities.

VBSP chairwoman Nguyen Thi Hong giving remarks at the meeting

To achieve the 2025 credit growth target set by the prime minister, Nguyen Thi Hong, governor of the State Bank of Vietnam (SBV) and chairwoman of VBSP’s BoD, urged the executive board to continue implementing key tasks and solutions outlined in the BoD’s resolutions.

She emphasised the importance of proactive capital mobilisation to meet growing demand for policy lending and to ensure the disbursement aligns with the assigned credit growth plans.

Governor Hong also called on the bank to advise the government, central agencies, and local authorities at all levels in the effective implementation of Directive No. 39-CT/TW dated October 30, 2024, issued by the Party Central Committee’s Secretariat.

The directive aims to enhance the effectiveness of social policy credit in the new period.

Additionally, she highlighted the need to adhere to the prime minister’s strategy for VBSP’s development through 2030, and a National Assembly resolution on policies to implement national target programmes.

“VBSP must continue to closely coordinate with ministries and relevant agencies in refining credit mechanisms and operational regulations,” said Hong.

She also called for reviews and proposals for adjusting policies in line with changes in administrative structures and delegation of authority.

In the words of Governor Hong, VBSP’s organisational model is unique. Unlike commercial banks, it incorporates participation from the entire political system.

Since its establishment, VBSP has received close guidance from BoD members and leadership at provincial and district-level BoD representative offices.

These local representatives serve as the extended arm of the central BoD, ensuring that policy credit reaches the right beneficiaries, for the right purposes, and achieves tangible impacts on the ground.

“2025 marks a pivotal year as we accelerate efforts to meet the goals of the socioeconomic development plan,” the governor said. “We are also undergoing a sweeping reorganisation of our administrative and institutional structures to drive reform and national progress. In this context, the role of VBSP’s BoD and its representatives at all levels is more critical than ever in implementing preferential credit policies for the poor and other vulnerable groups. Their responsibility, dedication, and closeness to the people are essential in ensuring effective service delivery.”

VBSP CEO Duong Quyet Thang giving remarks at the meeting

The importance of local BoD representatives was also highlighted in a report presented by Duong Quyet Thang, a BoD member and CEO of VBSP. Local BoD representatives have already advised party committees and local governments to transfer budgetary capital to VBSP for entrusted lending.

As a result, the volume of locally entrusted state budget capital to VBSP has increased by $2.3 billion, up $430 million on-year. This brings the total entrusted capital from local budgets to $2.46 billion as of May 31.

“The dedication and commitment of local BoD representatives over the years have been a cornerstone in building the credibility, effectiveness, and sustainability of social policy credit operations,” Hong concluded. “Their contribution is vital to our shared goal: to ensure that no one is left behind.”

VIR