The Japanese government and the Asian Development Bank (ADB) signed an agreement on Monday to provide Vietnam’s microfinance programs with US$1.5 million in grant aid, according to a press release.

The assistance, distributed via the State Bank of Vietnam, will also help strengthen the programs’ information systems, and help them introduce innovative pro-poor products as well as expand branch coverage, ADB said.

Programs with diverse stakeholders and private ownership will be the project’s main beneficiaries.

The funds also aim to provide key government officials with modern microfinance training as a step away from traditional government-financed credit programs, the press release said.

The Vietnamese government will give some $150,000 to the program, while participating institutions have committed to contributing $800,000 in total.

According to the press release, microfinance programs in Vietnam are dominated by the government and offer limited services to the poor.

Non-public microfinance, meanwhile, is often unable to mobilize large sums of money due to strict regulations, said the release.

Source: Thanh Nien