H4H

Microfinance Project

Introduction

Since its incorporation, one of the main priorities of Hearts for Hue has been to reduce poverty and improve the livelihoods of poor members in Hue’s surrounding areas.

The Microfinance Project of Hearts for Hue was established in 2007 to achieve this objective by providing ongoing financial independence through the provision of microloans for small enterprises.

The project will not be complete if an effort is not made to develop the education of the borrowers, such as providing them with money managing skills.

This project will concentrate on the resettlement areas for the boat people and those with disabilities.

The Microfinance Project will be carried out through different Programs attending to different locations. It will be funded by contributions of one or more sponsors. Nevertheless private individuals are encouraged to contribute as well to both financial and educational efforts.

For a description of the loans granted under each specific program, please refer to the corresponding section of each program

Hearts for Hue Microfinance Project has been running since 2011. Until now, three different programshave been implemented:

–       The Vy Da Ward, Hue City Microfinance Program. $35,000.00 USD sponsored by the D.O.V.E. Fund, a non-profit organization, founded in 2000, whose goal is to provide humanitarian and development assistance to the impoverished areas of Vietnam.

–       The Vinh Phu, Quang Phuoc and Huong van Communes Microfinance Program. $30,000.00 USD, sponsored by VESAF, a 501(c)(3) nonprofit charitable organization, founded in 2014, whose goal is to provide educational and social assistance to impoverished, underserved communities in Vietnam. .

–       The Huong Van Microfinance Program for persons with disabilities. $7.200 USD, sponsored by Micro-Credit Macro-Action and Individuals.

Project Objectives

Among many objectives we would like to draw your attention to the following:

–       To address the needs of poor families living in resettlement areas, enabling them to generate a sustainable income and giving them a chance for a better future

–       To give to the children of those poor families opprotunities for a good education

–       To deliver a positive impact to the community 

We would be proud to achieve these objectives and encourage all of you to help us in doing so.

Specifically the Project has two main objectives:

1) to provide ongoing financial independence through the provision of microloans for small enterprises

2) to provide potential borrowers with specific training and education to develop their personal skills and to familiarize them with money management skills

We want to underline the importance of the educational objective. Hearts for Hue understands that providing loans to beneficiaries of the Project will not be fully effective without educational and training efforts.

Project Activities

–       To visit each location and to carry out surveys on the living conditions in those areas eligible to participate in the Project

–       To meet with local authorities and local organizations

–       To design specific programs for each location

–       To determine the terms and conditions of the loans

–       To determine the terms and conditions of the Saving Programs

–       Electing possible candidates to participate in each program

–       To monitor each loan as well as the impact of the loan and training on the borrower’s families, and especially measuring the improvement, if any, in the educational prospects of their children

–       To evaluate each loan and the each program overall

–       To report to the sponsors and general public through the specific channels established for those purposes

One of the most relevant activities to be carried out is the establishment of a Savings Program. Beneficiaries of each program must accept their participation in the Savings Program as a condition to their eligibility. According with the terms of each Program:

–       Borrowers have to make monthly saving contributions of 10.000 VND ($ 0.50 USD).

–       Contributions accrue monthly interest at the rate of 10% per year.

–       Saving contributions are fully refunded to borrowers at the end of their participation in the program together with accrued interest

–       Optional Saving Programs are offered to borrowers according to their needs and solvency.

In performing these activities organizations other than Hearts for Hue may play an important role, such as the local Women’s Union in the process of electing possible borrowers.

Budget

There is not a budget for the whole project. Instead each of the programs will have a corresponding budget.

Funds for each program will be contributed by one or more sponsors

Contributions from private individuals will always be a viable option to finance the project or any of its programs

Outcome and Evaluation

The project and each of the programs will be monitored and evaluated by Hearts of Hue

Quantitative and qualitative indicators have been set to measure the outcome of each program, such as the number of participants or beneficiaries, the impact of their living conditions, or the children’s educational prospects.

At the end of each year an evaluation will be conducted to assess the results (impacts and effectiveness) of each program and the whole project

Special surveys will be carried out whenever a participant applies for a second or third round loan within each program

Future Steps.

Depending on the degree of success of each program, future steps will focus either on increasing the budget and initial term of the relevant program or on expanding the project to other locations

Some results of the Project since 2011

Since the beginning of the Project in 2011 funds in the amount of $65.000 USD have been committed. More than 600 loans have been granted to beneficiaries, mainly poor women running small businesses.

The average amount of a loan was 7,000,000 VND.

Most beneficiaries have required little capital since the initial loan.

To our satisfaction and the satisfaction of our sponsors and donors, after receiving the loan, all households were able to run their businesses effectively and thus, increasing their families’ income, helping to eliminate hunger, reducing poverty in their corresponding areas and increasing the chances of a better education for their children.

The project is scheduled to run until 2020.

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