A Good Quality Loan From The Perspective Of VisionFund Cambodia

VisionFund Cambodia is among the top three microfinance institutions (MFI) in Cambodia in terms of number of active borrowers.  As of December 2013, VisionFund Cambodia operates in 23 provinces and municipalities with a loan portfolio of over USD 60 million and more than 190,000 active clients of which 93% are women, and impacting over 600,000 children. With an average loan size of around $320 per client, VisionFund Cambodia believes that they are able to cater to the poorer segment of the population.

The benefit of getting a loan from Visionfund Cambodia? VisionFund Cambodia’s  loans have been recognized as good quality, indicating that repayment default rate is low (0.26% only) and most borrowers become better off. Moreover, customers can get financial education and other benefits through its many innovative programs. Mr.Chee Chin Hoe, CEO of VisionFund stated that VisionFund strives to provide good-quality loans in Cambodia to help reduce poverty in the country. A good quality loan has two key elements, which are: the repayment record and the proper usage of the loan by VisionFund’s clients for positive outcome. It also means that clients are able to properly manage and use the loan in order to generate enough income for repayment and at the same time to improve their livelihood, especially providing for their children’s health and education needs.

Financial Education Programs: As mentioned, getting loans from VisionFund also means receiving benefits on financial education. To derive quality loan, loan officers of VisionFund always provide basic financial education to clients focusing on basic money management. For instance, VisionFund usually provides advice and consultation to the customers about using loans more effectively, such as: their income should be more than expense; how to reduce unnecessary costs; and advising clients to have a specific savings goal. Therefore, they can use their cash to cover the cost of their children’s education in the future, or to invest or deal with any emergency needs.

Besides VisionFund also has a more advanced financial education program which is progressively rolled out by loan officers during loan collections. The 8 key topics under this program are: (1) setting goals, (2) managing your money, (3) taking a loan or using your own money to do a business, (4) the dangers of over-indebtedness and default, (5) comparing saving services, (6) making the budget for the family, (7) making a savings plan, and (8) staying within your budget/ implement your family budget plan.

Protection On Debt: VisionFund  Cambodia also provides some safety net to cushion clients against unexpected shocks or misfortunes – Apart from personal savings available through the savings product, loan clients get free protection benefit whereby VisionFund would write off the outstanding loan of eligible clients upon death.

Future Plan:VisionFund Cambodia is working on several projects in order to more effectively help those with low income and underserved community in Cambodia. VisionFund focuses on consumers’ welfare through continuous development and by expanding their products. Currently, VisionFund is working with a licensed insurance provider to offer customer a micro-health coverage because VisionFund understands the great need for health care in the daily lives of the people.

Finally, Mr. Chee Chin Hoe also believes that the identity and strength of VisionFund in social performance is complemented by the provision of good quality loans. A proof of the success of VisionFund as a social-focused MFI can be seen from the series of awards it has received in recent years. In the last 12 months VisionFund received at least five prestigious awards and recognitions from various segments.

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Photo information: Mrs. Mok Sameth, 42 years old, VisionFund’s client in Leuk Dek district, Kandal province