Vietnam Business Challenge Fund

Background

The Vietnam Business Challenge Fund (VBCF) is a specialised fund designed to support the private sector in Vietnam to develop innovative Inclusive Business models that deliver both commercial benefits for the company and social impact for the low income population.

The Fund operates from September 2012 until December 2015.

The mandate of the VBCF is to develop innovative Inclusive Business models that deliver both commercial benefits for the private sector and developmental benefits for the low income population. Developmental benefits include creating jobs, increasing incomes and improving access to basic goods and services.

Specific mandates of VBCF:

• To promote inclusion and innovation in the following sectors: i) Agriculture, ii) Low Carbon Growth and iii) Infrastructure and Basic Services;
• To overcome business risks and reduce transaction costs associated with including low income people in the value chain of companies;
• To remove barriers and improve the operation of value chains to facilitate inclusion of low income people in the core business of participating companies;
• To create incentives for companies to offer access to goods and services that include low income people in their value chain;
• To promote a better business climate for the private sector in Vietnam, addressing poverty eradication activities under innovative market-based and commercial mechanisms.

Eligibility Criteria

In order to evaluate and select Inclusive Business Executive Summaries, the first filter to be applied is the review for compliance to the following criteria.

VBCF grantees should fully meet all the following criteria to be eligible for assessment:

• The business proposes to work with the poor people in Vietnam either as suppliers, and/or consumers for mutual benefits of both the business and the poor people.
• Investment proposals should be relevant to any of the three sectors of application (agriculture, low carbon growth, infrastructure and basic services), and the subsectors and themes available for application.
• The business has proven experience, of at least two years, in a relevant sector to
  the proposed project, counting from the date of submission of the Inclusive Business Executive Summary.
• The applicant business is able to finance at least 51% of the project budget.
• The applicant business has one of the following legal status:
  • Private and Limited liability companies (LLC) registered and operating in Vietnam
  • Joint stock companies (JSC) registered and operating in Vietnam
  • Cooperatives registered and operating in Vietnam.

The Process:

The VBCF proposal application process follows the two-stage process.

The first stage is the submission of a concept note which will set out the idea not only in terms of its commercial viability but also on its potential development impact.

This will be assessed by a small team of assessors and the Fund Manager who will shortlist the best applications and then by the VBCF's independent Appraisal Panel.

At the second stage, shortlisted applicants will be invited to submit a full proposal, detailing their business plan and respond to all questions set out in the application form. This will be reviewed by the Independent Appraisal Panel. Successful applicants will be invited to contract negotiations with VBCF and awarded the grant.

DFID contact: tt-hien@dfid.gov.uk

Further information is available on the website: www.vbcf.org.vn