INFORMAL CREDIT FOR POOR HOUSEHOLDS: A CASE STUDY IN THAI NGUYEN PROVINCE

Abstract

This study aims to assess the demand for informal credit, the status of access, and the purpose of using informal credit by poor households in Thai Nguyen province, with primary data from a survey of 300 poor households. The results show that the rate of poor households accessing informal credit is relatively high through various forms such as borrowing from siblings, friends, neighbors; usury (high-interest); borrowing through community groups; private credit and pawn services. The purposes of using informal credit by poor households are diverse and have little significant impacts on poverty reduction.