VBSP loans help Bat Trang farmers expand high-value agriculture

VBSP loans help Bat Trang farmers expand high-value agriculture

With more than $2.52 million in outstanding entrusted loans, the Vietnam Bank for Social Policies is helping farmers in Bat Trang commune, Hanoi overcome capital constraints, expand production, and develop sustainable livelihoods.

Bat Trang commune in Hanoi is developing various high-value agricultural production models across more than 650 hectares of cultivated land, including around 330ha of vegetables and 320ha of flowers, ornamental plants, and speciality fruit trees, according to figures provided by Bat Trang People's Committee and Hanoi's Sub-Department of Crop Production and Plant Protection. In some production areas, annual income exceeds $20,000 per hectare. Preferential credit plays an important role in enabling farming households to invest in seeds, agricultural inputs, equipment, and expanded cultivation.

Through its entrusted lending mechanism via the Bat Trang Farmers' Union, Vietnam Bank for Social Policies (VBSP) brings concessional credit closer to its members, linking lending activities with grassroots-level borrower assessments, the management of savings and credit groups, and monitoring of loan utilisation.

According to Tran Bao Khanh, vice chairman of the Bat Trang Farmers' Union, the total outstanding balance of policy credit entrusted by VBSP through the union currently stands at $2.52 million, supporting 729 borrowers through 18 Savings and Credit Groups. Of this amount, more than $1.75 million is allocated to the employment creation programme, while $540,000 is provided under the clean water and rural environmental sanitation programme.

"Compared with 2025, VBSP's entrusted lending through the local Farmers' Union has increased by $200,000. Since the beginning of the year, 162 farmer members gained access to new loans totalling $639,200. The additional funding enables households to invest in production, develop local trades, and create employment opportunities within the community," he said.

The credit programme is implemented in line with residents' actual financing needs. Borrower selection is conducted publicly and democratically at the grassroots level. Following disbursement, the Farmers' Union coordinates inspections and monitors how loans are used. This approach helps households overcome capital constraints while also strengthening borrowers' accountability, ensuring that funds are used for their intended purposes.

Alongside policy credit, Hanoi's Farmers' Support Fund also provides additional financing for flower and ornamental plant cultivation, safe vegetable production, and speciality fruit-growing models. The local Farmers' Union currently manages an outstanding loan balance of $452,360 from this fund, serving 231 farmer households. Together, the two financing channels help meet the diverse investment needs of agricultural households, with VBSP playing a particularly important role in providing policy-based concessional credit locally.

The impact of this financial support is reflected in the development of specialised production areas for safe vegetables, flowers, ornamental plants, and fruit trees in Bat Trang. Safe vegetable yields range from approximately 83 to 108 tonnes per hectare annually.

Several areas have also adopted greenhouse and net-house production, hydroponic vegetable cultivation, and pomelo growing in accordance with VietGAP standards. These models are helping increase agricultural production value while generating additional income and employment for local residents.

Photo: VBSP

For small-scale farming households, access to appropriate financing helps ease the initial investment burden and gives them greater flexibility in purchasing seeds and agricultural inputs and organising production. However, to ensure the long-term effectiveness of lending, credit provision must be accompanied by effective loan management, supervision, and guidance on the proper use of funds in accordance with approved business plans.

In Bat Trang, credit quality has remained positive. According to the local Farmers' Union, neither the VBSP loans nor the Farmers' Support Fund loans managed by the union have recorded overdue debts or frozen debts, while the loan interest collection rate has reached 100 per cent. All 18 out of 18 Savings and Credit Groups have been rated good.

Since the beginning of this year, the union has conducted 10 inspection and supervision visits, monitored 12 newly financed households 30 days after disbursement, and carried out periodic checks covering 118 borrower accounts with outstanding loans. The results indicated that all inspected households had used their loans for their registered purposes.

In addition, 128 officials and union members received training in entrusted loan management and borrower selection procedures. Meetings of Savings and Credit Groups also provide opportunities for members to exchange production experience, share technical knowledge, and update one another on market developments.

"Looking ahead, the Farmers' Union hopes that VBSP will continue to allocate additional funding to meet members' growing demand for business and production expansion, while strengthening professional training and helping residents gain access to effective economic models," said Tran Thi Hai, chairwoman of the Bat Trang Farmers' Union.

VIR