Provincial Social Policy Bank improves credit quality

Along with loan disbursement, the work of urging debt collection plays an important role in improving the quality of credit programs and improving economic and social efficiency. Therefore, Binh Duong Provincial Bank for Social Policies (BSP) has strengthened solutions to ensure the safety of rotating loans.

Customers are granted policy loans at mobile transaction point People's Committee of Tan Hung commune, Bau Bang district.

Consolidation of activities

With the increasing scale of social policy credit activities, more and more credit programs, the management, maintenance and development of capital is always put on top. Credit investment must always be related with improving credit quality to ensure stable and sustainable development.

In the first months of 2023, the management, supervision, and urging of debt collection have been performed by provincial BSP and its transaction offices; At the same time, it requires cooperation from socio-political organizations, local authorities and related branches to strictly implement the Prime Minister's directive on improving the capacity and efficiency of preferential credit capital sources A series of solutions such as debt assessment, enhanced inspection, and unscheduled monitoring of transactions have been thoroughly implemented by the bank.

Vo Van Duc, Director of Provincial BSP, said that the bank has intensively implemented debt collection solutions throughout its transaction system and entrusted organizations at all levels. In particular, the bank system analyzed and evaluated credit quality periodically, continued to review and re-evaluate overdue debts, invading debts, outstanding interest debts to soon have solutions and plans for debt recovery according to regulations. 

In addition to regularly monitoring and unscheduled inspection of transaction sessions in the commune, the provincial BSP also conducted a comprehensive inspection according to the 2023 plan to closely monitor the transfer and use of loans. In particular, the bank focused on urging debt collection of savings and loan groups at the grassroots. Accordingly, heads of savings and loan groups conducted inspection and monitoring of capital use, evaluated the effectiveness of capital use of each member. At the same time, the groups actively monitored and urged overdue debts, regularly reminded and notified about debts that were about to be due so that the borrowers could prepare and pay their debts on time.

Secure capital resources

One of the units that always maintain good credit quality is BSP Transaction Office in Bau Bang district. By the end of June 2023, at this unit, 8,636 poor people and policy beneficiaries in the area received preferential credit loans with a total loan balance of 396.5 billion VND, low bad debt ratio, so far only accounted for 0.14%.

Nguyen Thanh Hiep, Deputy Director of BSP Transaction Office in Bau Bang district, said that this office timely offered advice to Board of Directors of the district BSP on the implementation and allocation of capital sources timely to communes and townships to ensure that it come to the right beneficiaries. In addition, this transaction office also actively directed staff to closely monitor due debts to coordinate with associations, unions, and savings and loan groups to urge borrowers to repay loans on time. Inspection and supervision work is also focused on by the transaction office, especially the observance of professional process at commune transaction points. As a result, many errors are avoided in the lending process, thereby improving the quality of policy credit in the area.

Loans from BSP have helped many people in the province create jobs, increase incomes, and stabilize their lives. The bright spot of social policy credit in the province is the guaranteed credit quality with a low rate of overdue debt, currently at nearly VND8 billion, accounting for 0.17% of the total loan balance of VND 4,252 billion with 82,218 customers.

Over the first 6 months of 2023, the local BSP system organized 89/91 transaction points at People's Committees of communes, wards and townships. At transaction points, preferential credit policies, loan programs, procedures, transaction rules, list of outstanding loans of customers are fully posted for organizations and individuals to check and supervise policy credit activities.  At commune transaction points, the rate of savings and loan groups joining the transaction reached 99.8%, disbursement rate reached 94.6%, interest collection rate reached 99.8%, principal debt collection rate reached 94.3%.

Reported by Thanh Hong - Translated by Ngoc Huynh