Microcredit for Sanitation: The Case of Sanitation Revolving Fund in Viet Nam by Hang Tran Thi Thu

7/29/2019 Microcredit for Sanitation: The Case of Sanitation Revolving Fund in Viet Nam by Hang Tran Thi Thu

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SANITATION REVOLVING

Philippines, J anuary, 2013



• Law on Environmental Protection (revised in

• Decree No. 67/2003/ND-CP; Decree-

• Decree No. 59/2007 (solid waste), No..supply);

. - - TTg by the PM on orientation for urban and

development(2009).•



EFFORTS BY THE GOVERNMENT

• Launched National Target

Program I (1998-2005), NTP II

(2006-2011), NTP III (2012-2015)

• Launched National Rural Water

Supply and Sanitation Strategy

NRWSS in 2001:

NTPgoals

By 2015/ Rural areas

*

NRWSSgoals

By 2020

Rural area Urban area

supply

suitable clean water;

* 45% use clean water atCVN-02BYT

atersupply

Prov e100% of ruralpopulation

100% o maorcities &provinceshave suitable wastewater treatment

(60liters/day/person);

* 100% of kindergartens andschools, health station have

w t ceanwater;

ac ty;

Sanitation &

* 70%households

* 80 – 90% of o ulation have

adequate clean waterSanitation &

Environment

* 65% of rural households havehygienic latrines;

* 100% of kinder artens and

Environment

haveadequatelatrines;

*

access to wastewater treatmentservice.

schools, health station have

adequate latrines.

households

practicegood



CONTEXT OF SANITATION REVOLING

FUND

• Poor system of water supply, sanitation and environmentin VN, especially in rural areas: Among 755 cities and

towns grade 1-5, big cities: Ha Noi, HCMC, Da Nang, HaLong… have concentrated wastewater treatment facilities,treatin ~10% 250.000m3/da 30% of IZ wastewater istreated; 90% of households have suitable latrines (98% in

cities); 75% of households in provinces and cities do not…

• Needed numbers of investment capital: for NTP3: $1.3billion; for urban area: $4.3-16.2 billion (up to technology

to be used)



Sanitation Revolving Fund:

Institutional structure insanitation status of households in both urban and

urban sanitationmanagement

rural areas, especially for thepoor.

Provincial People’s • Reduce environmental

pollution;

Committee

• Reduce water-borne diseases;

• Increase awareness on the

Sewerage and Drainage company

Urban Environmental

company

n age eween san a on,hygiene and health; practicesanitation at household level;Households responsible

• Increase community

responsibility in the



REVOLVING FUND OPERATION

Sanitation Revolving FundThe monthl collectedregulate conditions o loan

access & identify the eligibleborrowers.

principal and interest is the

revolving amount to be

provided to new borrowers.

1

24

supervise the loan

repayment and provide

education materials to

loans; build/improve their

sanitary facilit ies and pay

monthly interest.3

borrowers.



STRUCTURE OF SANITATION REVOLVING

FUND

Sanitation project PMU

Sanitation Revolving Fund

Local Women UnionProject componen

t

Project componen

t

Fund Provincial Management Unit

of fund, supervisegroup activities,provide educationcampaigns; report

Management Unit at ward/commune

level

Activ it ies : managegroup, identifyeligible borrowers,

Credit to rovnc a .

Credit Credit run meetngs,manage loanrepayment, collectinterest. 12-20member

s

12-20member

s

12-20member

s



KEY POINTS

• OPERATION

PRINCIPLES• ELIGIBILITY TO ACCESS

LOAN

• LOAN COST

- Ensure rightloan

- Be member of Credit group;having long-term/ permanent

- Loan amount:up to 10 millionVND (480

,line with project

goals/objectives

residence permit;

- Be poor/marginal poor

household;

USD);

- Duration: 12-20

months;-

repayment:voluntary,democrac

- Be in need of money forbuilding/improving sanitaryworks; + be introduced by local

- Interest rate:0.5-0.65% (half of commercial

publicity, andtransparency.

Women Union or localauthority;

- Be free of outstanding loan/

rate).- Payment: after 1

month since the

guaranteed for previous debt;

- Be able to pay back the loan;- Obe the rou rinci les;

borrowing date.



SOME COMMENTS

• Increased number of sanitation coverage:approx1.5millionhouseholdsbenefited.

• Sustainableaccesstosanitationservice.- Increasedawarenessfor local people.ss

- Strengthenedcapacity for WomenUnion.

• Highrepaymentrate: 99.3-99.6%

• Demand of hi her amount of loan

• Less use of loan for sewer connections;

•

Shortcomin

gs .



•

compulsory component in new water and

• Better allocation of resources to the Fund

• Creation of some special subsidies for

ex reme y poor ouse o s o access othe Fund.



Improvement of sanitaryfacilities

Training courses

Latrine

Gutter Sanitary equipment



Microcredit for Sanitation: The Case of Sanitation Revolving Fund in Viet Nam by Hang Tran Thi Thu

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