Why Debt Relief?
Chi Em is initiating a debt relief program in one case study village, Huoi Pung. In the late nineties, several consecutive failed rice harvests triggered a debt for the entire population of Huoi Pung (125 Kho Mu people), who borrowed from private rice lenders who charged interest rates of up to 50 percent per season. A cycle of debt ensued. Every October after the annual harvest, private rice lenders drive up the steep dirt road to Huoi Pung to collect thousands of kilograms of rice dues, leaving behind empty homes and residents disenfranchised of between 75 and 100 percent of their grain. Given the dire situation in Huoi Pung, Chi Em’s microfinance program is not viable. Rather than exclude Huoi Pung, Chi Em chose to innovate, attempting to set up a program that has never been tried in Vietnam. Chi Em expanded its activities to include debt relief through the creation of alternative financial and non-financial products. On the non-financial side, Chi Em teamed up with Hanoi Agricultur
