Community Development Fund – Story from Sustainable Livelihood Development Project in Cao Bang

Community Development Funds (CDFs) were established in 28 Development Clubs of Sustainable Livelihood Development Project, Cao Bang, Vietnam. The funds aim at assisting household economic development that directly helps increase family’s income. After 3 months of entering practice, 262 households received loans from CDFs of total disbursement reaching 686 million VND.

CDFs are the Matching Funds among the community and ADRA in Vietnam. The organization provides a certain grant to each Community Development Club (CDC), layering the first brick line for the so-meant Community Fund. This is to ensure that after project’s withdrawal, the local people are still able to run and manage their own financial source that benefits whole community.

Families desiring to access this fund must submit proposals to the Club. The Club will decide the amount of loan, interest rate and payment period as well the feasibility of development model based on a participatory manner of all members.

Mr. Quan Van Thu is a member of Duong Dinh CDC. His family’s income was mainly generated from the small agricultural production which frequently faces the dramatically up and down trend of weather and market price. He however had to spend a large part of this income to support his daughter who is studying at a university. Often, Mr. Quan did not have enough capital to buy breeding animals and fertilizers in order to develop cropping or animal husbandry.

Quan still owed a debt from the Social Policy Bank, paying for his daughter’s schooling. The Bank still offered him another loan, yet he resisted in taking the new one, being afraid of debt heaped up.

Once the CDF was formed in his community, Quan and many other families took use of their gained knowledge from a variety of provided training courses by ADRA in order to elaborate economic models. Though this was the first time having a plan for rearing ducks clearly written, Quan took into account the measurement of risk and profit. Furthermore, sharing and discussing the scheme with other CDC members have increased the reviews towards plan, strengthening his confidence on the plan implementation.

Quan received the loan’s worth of 2 million VND from CDF, plus his corresponding fund. He decided to kick start the flock with 50 ducks. After a raising period, each duck now weighs 2.5 – 3kg in average. The whole flock is more than 10 million VND of current price market; Quan earns approximately 6 million VND of profit. This amount is subtracted a portion to assist his daughter’s schooling, the rest will be used for reinvestment in the same model.

“CDF is meaningful in a way it helps solve the need of borrowing money for developing various household economic models. We still have to contribute our own part to form the sufficient funds; however we feel like bearing more responsibilities to keep our models safe and profitable. Another plus point is that CDF is managed by Community Development Club, in which most of the issues are brought into discussion and sharing among members. Am glad that my experience of the last time raising ducks unsuccessfully finds the clue of getting better this time. For instance the other club member showed me the usage of Gluco-k-c to reduce the mortality rate among the baby flock”, said by Quan.