Are households’ poverty levels in Mekong Delta of Vietnam affected by access to credit?

Abstract

This paper investigates the impact of access to formal credit on household poverty in Mekong Delta (MD) – Vietnam. The analysis is based on some indicators of household poverty such as households’ total assets, educational costs, healthcare costs, food consumption, non-farm expenses, off-farm expenses and total income. Based on the given indicators, a comparison is made between borrowers and non-borrowers in a sample of 325 households using the Matching Methods. The findings suggest that the borrowers are better off in education expenditure, healthcare expenses, and total income than those of non-borrowers. The results show that access to formal credit is likely to reduce poverty levels among rural households in Mekong Delta