PURPOSE

The Microcredit Program aims to provide for the poor, the indigenous women in rural areas and other vulnerable groups to have a chance to access financial resources in producing and solving difficult problems in their life. Asides from that, the program also help to create and enhance a collectiveness toward consciousness, saving awareness, and financial use effectively for the poor.

PATHWAY

The goal of the program is: "the poor can help each other out of poverty". The program is not based on commercials but mainly on social background. However, the annual income generated from the program activities that becomes crucial in promoting sustainable development.

The program helps participants save money in groups; the contribution of many participants can help the group members having a certain amount of funds when needed. The way to participate in groups creates flexibility and is extremely disciplined. The program also supports ethnic minorities with some investment to avoid premature borrowing, so that the economy gradually improves.

HOW TO PERFORM

The microcredit program is implemented by forming savings groups of women (8-12 people/group). Each group will elect a team leader and a deputy in charge of monitoring, summarizing savings and books keeping of group members. Group members must be accountable to each other and have full authority to decide who belongs to their group. Each month, each person saves about 30,000 VND (1000 VND per day). After a period of savings, participants can borrow money in an emergency at an interest rate set by the group. A member can only borrow when all others in the group agree. The amount of the group's profit for the year will be used at the group's decision agreement.

When the members of the group contribute regularly from their savings, they can get an additional loan from the funds sponsored by the benefactors. Loan support is only used to invest in production and cannot be used for any other purpose. Everyone is responsible for encouraging other members to pay the loan amount (with an interest rate of 0.6%/month), which is a condition for the group to continue to get loans in the next period.

The model is only successful when everyone complies with group discipline: group meetings and regular savings accounts, sharing production experiences, saving experiences, sharing life circumstances, taking responsibility for borrowing /payment of group members, each member has a voice, has the right to decide… Therefore, in addition to the goal of increasing income, reducing premature loans, the program also has a social impact. Women will feel trust worthy, their voices are heard and they are confident in their ability to help themselves and help others out of poverty.

The microcredit program has been implemented by the Social Charity Department - Caritas Da Lat since 2008 in several districts in Lam Dong province. In 2021, the program is supporting 720 members who are ethnic minority women's groups, several groups of men and groups of people with disabilities in Don Duong, Di Linh, Dam Rong, Lac Duong, Bao Lam.