Microfinance – A First Impression

The last thing I did before leaving Australia to take up a 7-month volunteer assignment through the Australian Volunteers Programme, was to meet with my university professors. We discussed our working paper on modeling contracting processes in microfinance. One of them sardonically said, “and maybe when you get back, we can write about what actually happens!”. So here we are, some first impressions on what actually happens and the accomplishments of Hearts for Hue (H4H).

Hương Vân District

The H4H microfinance team drove about an hour to Hương Vân Ward to meet Mrs Anh, the leader of the local Women’s Union, and to receive the monthly loan repayments from the 187 microfinance participants in the district. Mrs Anh had already collected the money from the borrowers and so all we had to do was check that it was correct. Simple.

The most complicated financial transaction I’ve ever witnessed then ensued. We counted what looked like billions of dong from hundreds of borrowers only to be a few hundred thousand short (not significantly more than AUD$10).  So we started all over again. In the meantime, a stray envelop was found and the ledger squared.

Outside of Mrs Anh’s office, staff from H4H were greeted like family and quickly invited into the borrowers’ homes. Ms Nguyễn Thị Vẽ was the first to invite us inside. She was clearly on good terms with H4H staff and proudly showed us through her house and to her back yard where she had invested part of her microloan in her pomelo trees, now in full fruit. The other part of her loan was invested in setting up a roadside stall, where she sold cold drinks and was busy weaving religious incense.

Ms Phạm Thị Hà pulled up at the stall, bought a few items and invited us to her house down the road. Ms Phạm Thị Hà had invested 4 million dong (about AUD$240) of her loan in a second hand sewing machine, the other 3 million dong was spent on rent. The machine allowed Ms Phạm Thị Hà to work as a tailor and although never receiving training, she produces very high quality clothing. Thanks to her new business, Ms Phạm Thị Hà now earns around 4 million dong a month with which she supports her two children and her husband who has recently become too ill to continue working.

Ms Nguyễn Thị Vẽ  and Ms Phạm Thị Hà wanted to thank VESAF for the opportunity to begin their businesses. Proof that this thanks is genuine, is that demand for new loans in Hương Vân ward is enormous. Through word of mouth, more women are becoming aware of the microfinance programme and almost every month, staff from H4H receive business proposals from new groups of women requesting loans.


The first impression from Nguyễn Thị Vẽ and Ms Phạm Thị Hà is that some microfinance caricatures are true. More importantly, that H4H’s microfinance programme really does increase the incomes of the borrowers: it is working.

Alistair Cameron

Hearts For Hue Team

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