Knowledge is not just power for the poorest of the poor in Dien Bien province; Knowledge is necessary to maintain daily life and to be able to provide food and shelter for one's family, let alone climb out of poverty. In addition to microloans and savings accounts, Kiva's field partner, Entrepreneurs du Monde-Anh Chi Em ("ACE"), in Dien Bien provides the most vulnerable in Vietnam with agriculture, business and social/health trainings to help ensure that borrowers are in a position to be able to repay their loans to eventually increase their standard of living.
Dien Bien Province Contains Some of Vietnam's Most Vulnerable Populations
Dien Bien is one of the poorest provinces in Vietnam; 30% of ACE's clients have been designated "poor" and "near poor" by the Vietnamese government, as agriculture and business-oriented, money management trainings provided by ACE are of utmost importance for their clientele who largely work in the agriculture sector. This is significant because many microfinance programs reach low income borrowers, but struggle to reach the poorest of the poor. ACE also primarily serves vulnerable populations, namely, Thai ethnic minority women, who are 74% of ACE's clientele and who live in rural areas outside Dien Bien Phu City and often represent the poorest of the poor in Vietnam. Additionally, the mountainous province of Dien Bien faces double the number of residents who have HIV/AIDs as compared to the rest of Vietnam, as education and awareness of the effects of and ways to prevent the spread of HIV/AIDs in Dien Bien are essential to maintain daily life, let alone successfully pay back loans.
Scope of ACE's Non-Financial Services
From social trainings (e.g., how to prevent HIV/AIDs; how to handle domestic violence) to agriculture trainings (e.g., how to raise pigs, chickens and water buffalo; how to vaccinate animals to prevent disease) to business trainings (e.g., managing funds; networking between suppliers and buyers), the poorest of the poor in Dien Bien are armored with necessary, impenetrable skills to ensure their success, before and after receiving loans, by ACE. HIV/AIDs is one of Vietnam's most pressing health issues, as an estimated 250,000 are living with HIV and about 67,000 of them are women, according to UNAIDs. Dien Bien province has double the number of residents living with HIV/AIDs because many unaware residents who travel to other areas for work sometimes inject heroin, contract the virus through needles, and then unknowingly spread the virus to their spouses and partners. When a borrower or their family member contracts HIV/AIDs or falls victim to domestic violence, it can be doubly hard to pay back a loan. Many who contract HIV/AIDs die shortly thereafter.
1. Social Trainings. Here are images from an HIV/AIDs training that took place at an ACE group leader's home in a traditional Thai ethnic stilt house. Most of the attendees are Thai ethnic minority women. You can tell that the women are Thai ethnic minorities because the women wear their hair in a high bun every day to signify that they are married.
One of ACE's social workers engages borrowers with photos and explanations of what the drugs look like, how to tell if someone is using drugs, and what to do if they discover that someone they know is using drugs.
An audience member volunteered to explain which photo falls under which category out of the three categories (cause, effect & solutions/ways to prevent drug use).
ACE manages to make serious trainings engaging and fun. The women seemed to be enjoying themselves as they learned more about a serious issue in their village.
Borrowers in the above photo discuss images of different types of drugs. This social training was mostly focused on opium and heroin addiction.
2. Agriculture Trainings. Likewise, when a borrower obtains a loan to purchase crops to grow or animals to raise and sell in the future without the proper knowledge as to how to properly grow the crop or raise healthy animals and prevent diseases, the loan becomes a burden rather than a blessing. Animals can easily fall prey to common, preventable diseases, and die shortly thereafter. ACE therefore requires agriculture loan recipients to attend a mandatory agriculture training before receiving their loan disbursement.
Here are photos from an agriculture training and disbursement I attended in a local village about one hour outside of Dien Bien Phu City:
Structuring the Program to Maximize Benefits: Flexibility & Transparency
The devil is in the details when it comes to crafting a successful poverty alleviation program that utilizes both financial and non-financial services, as the program must provide flexibility for the trainings and make knowledge sharing as painless for the borrowers as possible as well as facilitate social support and transparency to encourage timely repayments. ACE's carefully crafted "Doan Ket" ("Solidarity" in Vietnamese) program achieves all of these goals, as outlined below.
1. Trainings: Flexibility & Knowledge Sharing. ACE's Doan Ket program facilitates knowledge sharing and flexibility via building and maintaining cohesive social support and transparency at the village level. Borrowers, especially single mothers who have lost their husbands to HIV/AIDs or another illness, sometimes find it difficult to attend the trainings since they have several (often 3-4) different jobs that occupy most of their time. Additionally, many borrowers remain unaware as to how essential the trainings are to their livelihood. For example, borrowers may receive a loan to purchase animals to raise and sell (which, along with rice harvesting, is for many of these borrowers the only source of income they have ever known and had access to) only to have their animals die from disease shortly thereafter without knowing why or how this could have been avoided.
This is why the program structure is key. Through ACE's "Doan Ket"program, ACE facilitates the democratic selection of a group leader for a group size of no more than 40 borrowers. The group leader selected by the group members is normally relatively successful, well-liked in the village, and motivated to assist fellow borrowers. After the group selects the group leader, ACE requests that the group members meet monthly to both make repayments as well as receive necessary training. If a group member cannot make a training, in the event it conflicts with their work schedule, the group leader is responsible for informing the group members about the information she or he learned during the training at a time that is convenient for the group member who missed the training.
Thuy, pictured below, is one such Doan Ket group leader.
Thuy is the chief of her village's women's union in addition to her job as the elected Doan Ket group leader. She is married with two children: a son who is 15, and a daughter who is 12. Thuy has received several loans from Kiva and has since been able to build a new, larger house and also doubled her income from when she began taking out loans. All of Thuy's loans have been for animals (pigs and chickens) or animal feed. Thuy has attended 13 free-of-charge trainings through ACE's Doan Ket program since 2013. The trainings she found most helpful were the technical trainings regarding how to properly raise pigs and chickens. Through these trainings, Thuy learned how to select healthy animals, when to sell her animals, how to protect the animals from disease (e.g., what kinds of vaccines to buy), and what to feed her pigs when they are pregnant to ensure they receive proper nutrition. She told me she plans to begin raising ducks in the near future, in addition to her chickens and pigs.
2. Loan Repayments: Social Support & Transparency. ACE's Doan Ket group leaders are also responsible for collecting repayments (along with ACE's credit officer) and ensuring that the borrowers are able to attend the designated repayment days together. Doan Ket group members are required to meet monthly to make repayments (and receive training), as this format encourages transparency and has resulted in higher repayment rates due to social pressure.
Conclusion
ACE's poverty alleviation program arms borrowers with the knowledge and skills needed to ensure that they are in a strong position to make repayments on their loans to eventually escape the poverty trap. ACE accomplishes this via its Doan Ket methodology and structure, which leverages group leaders and monthly meetings to ensure knowledge sharing and flexibility and to encourage transparency and social pressure to make repayments on time. ACE has expanded their reach over the past few years, accumulating more clients each year, and plans to expand its services further. I have no doubt ACE will continue to make a tangible impact on the lives of others with continued support from Kiva lenders!
To support ACE's work, you can lend (*not* donate) as little as $25 to ACE's Kiva borrowers in one of the poorest provinces of Vietnam by clicking here.