Customers who need to continue paying social insurance can borrow without collateral up to 120 million VND, for 84 months, through Vietnam Post.
On the afternoon of January 19, Vietnam Post Corporation (Vietnam Post) and Vietnam Public Joint Stock Commercial Bank (PVcomBank) launched a social security credit product for customers who want to continue paying social insurance.
The goal of the credit package is to help workers who have lost their jobs, are temporarily unemployed, or have reached retirement age but are not yet eligible for pensions to quickly access appropriate capital sources, reduce immediate financial pressure, and thereby avoid having to withdraw social insurance at one time.
This credit package includes three products: unsecured loans for people reaching retirement age; unsecured loans for people who are temporarily suspending social insurance payments and have a guarantor; and unsecured installment loans for people nearing retirement age and nearly reaching the required number of years of insurance payments.
Mr. Ngo Dang Hoan, Deputy Director of PVcomBank's personal customer segment, said that the scale of the credit package deployed in 2024 is 3,100 billion VND and "can be expanded depending on the situation". The interest rate is from 8.5% per year depending on the customer group.
People can access loans with a maximum remaining insurance period of up to 10 years; the maximum loan amount is VND120 per person, the principal grace period is up to 3 years; and the loan term is up to 84 months.
Borrowers are also not required to meet minimum wage, minimum income, or credit rating requirements. Customers who choose social insurance loan products are also given health insurance by PVcomBank for the entire loan period.
Vietnam Post General Director Chu Quang Hao said that this credit solution contributes to stabilizing the national social security network and limiting illegal credit activities. PVcomBank is the first partner that the enterprise cooperates with to deploy the product in 28 localities.
Mr. Tran Hai Nam, Deputy Director of the Department of Social Insurance (Ministry of Labor, War Invalids and Social Affairs) assessed that the credit package meets the goals of development and expansion of social insurance coverage, including retaining workers in the social security net and ensuring long-term income.
The Covid-19 pandemic and the global economic recession have directly affected businesses and workers. This has forced a large number of workers to withdraw their social insurance at one time to cover their living expenses.
In the 2016-2021 period, more than 4.25 million workers participated in social insurance and 4.06 million people withdrew at once, making the safety net increasingly thinner.
On average, nearly 700,000 people withdraw their social insurance at one time each year, with the number increasing each year, with an average growth rate of 11%. The total cost of payment during this period is VND 131,940 billion, according to statistics from the Ministry of Labor, War Invalids and Social Affairs in a report in early March 2023.
In the context of a rapidly aging population, forecast to reach 23.3 million (20.9% of the population) by 2040, the increase in one-time withdrawals has led to a further narrowing of social security coverage. In the future, the state budget will have to spend more on social subsidies for non-retired elderly people.
Duc Minh
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