Bringing the Fund for supporting workers, civil servants and poor laborers closer to the workers

The City Labor Federation's capital support fund for workers, civil servants, and poor laborers has become a solid support, helping thousands of union members overcome difficulties and stabilize their lives.

Fund representatives work with the Trade Union of Thai Anh Investment and Trade Services Joint Stock Company on implementing an emergency loan package for union members and employees. Photo: NGUYEN NGUYEN

Established in 2014, up to now, the Fund for supporting workers, civil servants and poor laborers of the City Labor Federation has helped thousands of union members overcome difficulties and stabilize their lives. The Fund is also a practical solution to help workers avoid "black" credit. Comrade NGUYEN ANH TUAN, Vice Chairman of the City Vietnam Fatherland Front Committee, Chairman of the City Labor Federation, talked with reporters of Hai Phong Newspaper and Radio and Television to clarify more about the Fund's activities.

- Could you tell us what outstanding results the Fund for supporting workers, civil servants and poor laborers has achieved after more than 10 years of operation?

- The City Labor Federation's Fund for Workers, Civil Servants, and Poor Laborers is a model that is deeply humane and for the people, aiming at the goal of "not leaving any union member behind due to financial difficulties". The Fund operates on a non-profit basis, complies with legal regulations, preserves and develops capital, and aims to promptly support union members, workers, civil servants, and laborers when they encounter difficulties and hardships; and prevents the situation of "black credit" and financial fraud that is creeping into the lives of workers.

From the initial capital of 5 billion VND in 2014, the Fund has now grown to 60 billion VND, a 12-fold increase, supporting 7,205 union members to borrow capital with a total circulating capital of more than 194.6 billion VND. The loan packages do not require mortgages or asset guarantees, only need confirmation and credit from employers and grassroots unions, making it easy for union members to access.

Every year, nearly 1,000 customers, accounting for nearly 70% of the Fund's total customers, have borrowed capital to invest in production, business, small services... creating jobs for relatives and the community. The average income of each family increases by 2 - 4 million VND/month.

By the end of 2024, more than 1,000 union members will not have to re-borrow after borrowing capital, and their family conditions will improve, stabilize, and develop.

Representatives of the Fund for supporting workers, civil servants and poor laborers give gifts to union members and borrowers in difficult circumstances. Photo: HA THANH

Along with that, the Fund disburses loans to promptly support many union members who have had accidents, for medical examination and treatment, house construction and repair, investment in children's education, etc.

From the beginning of 2025 to now, the Fund has disbursed nearly 100 emergency loans through direct or the Huong Cong App - Hai Phong Trade Union. The loans mainly serve union members facing sudden difficulties, such as: illness, tuition fees, funerals, natural disasters... For example, Mr. Pham Huu Van, a union member of Nhat Hung Leather and Footwear Company Limited (Hong An Ward) borrowed 7.8 million VND to buy a vehicle for his child; Ms. Nguyen Thi Nhan, a union member of Sao Vang Company Limited (Dong Hai Ward) borrowed 5.5 million VND to buy household items...

- During the implementation process, what difficulties and problems did the Fund encounter?

- Although the Fund's activities have achieved many positive results, there are still some limitations. First of all, the capital source only meets about 1/3 of the actual needs of workers. Many grassroots unions and enterprises want to deploy loans for workers, but the Fund does not have enough resources to expand.

On the other hand, the current maximum loan amount of 50 million VND is no longer suitable, while the prices of goods and living expenses are increasing. The fact that some businesses are still hesitant to sign guarantees for workers to borrow because they are afraid that workers will "jump ship" also makes the rate of workers in the business sector accessing capital still low, only about 10%.

In addition, the Fund's staff is still thin, the workload is increasing, requiring more specialized training and supplementation.

- To make the Fund more effective in the coming time, what solutions does the City Labor Federation have?

- The upcoming goal is to maintain, preserve and develop capital, strive to have no bad debt or risks; at the same time, expand the loan target to more grassroots unions and enterprises.

In the period of 2025 - 2030, the City Labor Federation strives for 50% of grassroots unions to have access to loans from the Fund. The City Labor Union will also open a second microfinance program or advise on increasing charter capital by another VND50 billion if there are new instructions from the State Bank to serve more deeply the disadvantaged workers.

The City Labor Federation promotes the application of technology, completes the Huong Cong App, builds an automatic risk management and control system; strengthens professional training, closely coordinates with grassroots trade unions in inspection, supervision, and ensures that loans are used for the right purposes.

The Fund continues to maintain activities to support community development such as giving gifts to children of union members who have overcome difficulties and studied well, helping union members who have had accidents or serious illnesses, etc.

- It is known that the Fund is testing the shortening of the loan process and has many innovations in procedures. Can you provide more information?

- One of the Fund's breakthroughs is to bring loan activities to the digital platform App Huong Cong - Hai Phong Trade Union, helping union members to register for loans, sign contracts, disburse and monitor loans completely online.

Previously, the loan process consisted of 6 steps, from registration, confirmation, signing of loan principle contract and loan application to disbursement and debt collection. Currently, the City Labor Federation is testing to shorten the process to 4 steps, integrating intermediary steps, reducing waiting time.

In particular, customers who re-borrow do not have to re-sign the loan principle contract within 12 months, but only need to register the loan amount on the App based on the previously signed principle contract.

Thanks to this improvement, operations are completely performed using MySign digital signatures, helping grassroots unions and employees save significant time and costs.

- In addition to the solutions within its authority, what recommendations and proposals does the City Labor Federation have?

- The City Labor Federation recommends that the Vietnam General Confederation of Labor continue to advise and coordinate with the State Bank and the Ministry of Finance to issue unified regulations on management and supervision of capital support funds, and soon have separate regulations for the microfinance program of trade union organizations.

The Vietnam General Confederation of Labor supports capital or preferential loans, creating conditions for localities, including Hai Phong, to expand the scale of services for poor workers.

The City Labor Federation also proposed that the City People's Committee support additional charter capital to better meet the growing demand for loans; the State Bank of Vietnam, Hai Phong branch, support the Fund's operations to open new microfinance programs, contributing to making capital support activities more effective and closer to the practical life of workers.

- Thank you very much, comrade!

Main loan packages of the Fund for supporting workers, civil servants and laborers

* Emergency loan package: Allows union members to borrow up to 80% of their salary and allowances; interest rate 6.6%/year. This is also a loan package that the City Labor Federation is promoting through the Huong Cong App - Hai Phong Labor Union.
* Short-term loan package: Maximum loan amount of 20 million VND/borrower; loan term from 1 - 12 months; for needs such as medical treatment, tuition payment, funerals, natural disaster relief, epidemics, etc.
* Medium-term loan package: Maximum loan amount of 50 million VND/borrower; maximum loan term of 36 months; serving production, small business, improving living conditions, building and repairing houses, medical treatment, supporting vocational training, raising children to study... Interest rate applied from 6.6% to 7.8%/year/actual outstanding debt.

THANH HA (performed)

Source: https://baohaiphong.vn/dua-quy-tro-von-cong-nhan-vien-chuc-lao-dong-ngheo-den-gan-nguoi-lao-dong-525772.html