The impact of microfinance on employment and income of the poor in Vietnam

In terms of theory and practice, microfinance activities have affirmed their role in promoting job creation and increasing income for the poor. This study focuses on analyzing the impact of microfinance on the employment and income of the poor in Vietnam through financial intermediary services and social intermediary services. Based on the theoretical framework, the author conducted a direct survey of 300 poor people who received loans for production and business in the past 5 years. The survey area was identified as three provinces in the mountainous region of the Northwest - the area with the most difficult economic conditions in Vietnam; the provinces include Lai Chau, Dien Bien, and Son La. The results of the research and survey show that the poor are more interested in receiving direct loans (through financial intermediary services) to invest in production and business with the hope of escaping poverty and developing. Borrowing capital through savings groups and lending groups (through social intermediary services) is bound by many procedures and processes related to local organizations and groups, so many poor people have limited access; they rate it lower in terms of convenience and efficiency compared to borrowing capital directly from microfinance organizations. From the results of this study, the author discusses some contents aimed at removing difficulties to continue promoting microfinance development to create jobs and income for the poor in Vietnam.