Semiofficial micro-financial activities are usually included in projects that are sponsored by non-governmental organisations or mass organisations, funded with budget capital or member contributions. These projects are considered successful in approaching poor customers.

The Vietnam Microfinance Working Group of the Vietnam Union of Friendship Organisations hosted a seminar to assess these activities on February 26.

Deputy Head of the SBV Banks Department Truong Ngoc said that compared with other financial organisations, the market share of semiofficial micro-finance activities is just 5-6 percent of the total value of organisations involved in micro-finance activities for the poor.

“If these organisations are changed into those with legal entity status to operate under the Business Law, they will be equal with the others in mobilising capital in the market to give better help to the poor,” he said.

The SBV has received three applications from organisations that want their status changed into micro-finance organisations, he added.

Together with finalising the legal procedures necessary to boost the development of the micro-finance sector, the central bank is lending its weight to the establishment of the Vietnam Microfinance Association. The association is expected to protect the legitimate rights and benefits of micro-finance organisations. It will also coordinate with the SBV to lobby the Government regarding issues that concern microfinance activities.

The French Development Agency and the Asian Development Bank have pledged US$3 million to help Vietnam’s micro finance sector fund personnel training for its professional organisations.