The Thọ Phú commune police work with residents at their homes, gathering information and promptly disseminating information to prevent violations of the law at the grassroots level.
After work, LVH, a worker at a company in Tho Phu commune, sat in front of his rented room and recounted his loan: "Initially, I only borrowed 10 million dong to cover living expenses, promising to repay it within 10 days. The loan was undocumented, simply through a mutual acquaintance."
More importantly, the lender didn't mention or record the interest rate, but the repayment method was fixed from the start. For a 10 million VND loan, Mr. LVH had to pay 1.2 million VND per day for 10 days, totaling 12 million VND. The interest was divided into small daily installments, making the loan appear like a regular payment. In the beginning, Mr. LVH's payments went smoothly; however, if he was even one day late, the calculation immediately changed. "For each day late, they added 200,000 to 300,000 VND to the amount due the next day."
"Once I had to pay nearly 2 million dong to make up the difference according to the lender's calculation," said LVH.
The unpaid amount was carried over to the next day, along with penalties, causing the total amount owed to increase each time LVH was late. After more than half a month of struggling to pay, the total amount he owed had reached nearly 15 million VND, even though the original loan was only 10 million VND. "Each time I was late, the lender charged more. They didn't specify the percentage, but the amount just kept increasing. If I didn't pay, they would call constantly, even my relatives," LVH said.
For workers like him, income depends on shifts and monthly wages. With a salary of over 7 million VND, after deducting rent and food expenses, there's almost nothing left over. Short-term loans therefore give the illusion of being manageable, but when payments are late, the pressure isn't just about the money; it extends to the constant calls and messages reminding him of the debt.
LVH's story is not unique. In areas like Tho Phu – where there is a high concentration of workers and a thriving production and service industry – the need for quick loans is ever-present. When interest is spread out daily, the risks don't come all at once but accumulate little by little until the borrower is no longer able to cope.
According to the 2015 Civil Code, interest rates in civil transactions cannot exceed 20% per year. However, many informal loans do not specify an interest rate, instead charging daily installments, making it difficult for borrowers to determine the actual interest rate. Lawyer Vu Van Tra from Son Tra Law Firm stated: “The absence of an interest rate in the loan agreement does not change the fundamental nature of the loan. When the amount payable exceeds 20% per year, the excess will not be protected by law. In cases where there are signs of illicit profiteering, the lender may be prosecuted under criminal law.”
Following the merger, Tho Phu commune's area expanded, resulting in a larger population, a concentration of laborers, and numerous businesses, production facilities, and service establishments. Along with this dynamic development came complex underlying security and order issues, including crimes related to "loan sharking." Based on this reality, the commune's police force shifted its focus to more proactive prevention of "loan sharking," prioritizing early detection. Regular monitoring of the area is maintained, with officers assigned to each village and residential cluster. Simultaneously, they coordinate with local security teams to review population data and identify emerging relationships, thereby early detecting signs of intermediary loans or loans from unknown sources. In public spaces, illegal loan advertisements along roads and in residential areas are inspected and removed. "Underground" channels such as word-of-mouth phone numbers and social media groups are collected and cross-referenced to aid in management and limit the spread of these activities. Simultaneously, awareness campaigns were conducted, focusing on high-risk groups such as factory workers and young laborers.
Similarly, in the coastal commune of Van Loc, where the population is large and small-scale trading and services are thriving, "loan sharking" does not appear openly but still exists in the form of small transactions through personal relationships. According to the commune police, no cases of people reporting being involved in "loan sharking" have been recorded since the beginning of the year. However, based on monitoring the situation, loan transactions still occur sporadically, requiring the commune police force to closely monitor the area to identify them promptly.
Here, the commune police force goes down to each village, coordinating with the village head and the security and order protection team to review emerging relationships, thereby detecting early signs of "loan referrals" and intermediary loan connections. Illegal loan advertisements in market areas are inspected and removed; phone numbers and QR codes with loan content are collected and cross-referenced for management purposes. For cases with urgent loan needs, the commune police coordinate with the Women's Union, the Farmers' Association, and the Youth Union to approach and educate people about the risks, while guiding them to access legitimate sources of capital from the outset.
From overt forms, lending activities have shifted to insidious small-scale transactions based on personal relationships. It is in these seemingly simple transactions that risks begin to accumulate. Therefore, prevention should not only stop at eradicating the problem, but must begin with early identification and intervention at the grassroots level, as soon as the first signs appear.
Text and photos: Tang Thuy
Source: https://baothanhhoa.vn/nhan-dien-som-de-ngan-chan-nbsp-tin-dung-den-o-lang-que-286384.htm
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