Congratulations to this week’s winner of the Raffle for Institutional Action Plan Submitters, Fonkoze of Haiti!
Fonkoze is Haiti’s alternative bank for the organized poor. In fact, it is a family of three institutions working together shoulder-to-shoulder towards a single compelling mission: building the economic foundations for democracy in Haiti by providing the rural poor with the tools they need to lift themselves out of poverty. This mission is reflected in our name, Fonkoze, which is an acronym for the Haitian Creole phrase “Fondasyon Kole Zepòl” meaning “Shoulder-to-Shoulder Foundation.”
Fonkoze was founded in 1994 by 32 grassroots leaders led by Father Joseph Philippe, a Haitian priest and community organizer, as a way for rural cooperatives and market women to have access to financial services like savings and credit. Fonkoze has since grown from two volunteer employees to Haiti’s largest microfinance institution with over 900 employees and 46 branches serving over 60,000 loan clients and 250,000 savers.
How We Work
Nearly all of Fonkoze’s branches are located in small rural towns in every corner of Haiti. Our branches serve as full retail locations with teller windows for deposits/savings, money transfer services and currency exchange. Branches also function as the home bases of our staff who travel on motorbikes to meet with clients.
In our main microcredit program, clients form solidarity groups of five women who take out loans together. These groups are organized into ‘centers’ with 10 or more other groups that meet bi-monthly with Fonkoze staff to complete transactions, participate in education programs, receive training and support each other’s’ progress out of poverty.
The Poorest – Chemin Lavi Miyo
Chemin Lavi Miyo, or the Road to a Better Life, reaches the poorest of the poor in Haiti who aren’t yet ready for one of our regular loan programs. We target women-led households who have little or no assets, no children in school, no access to healthcare and often have unreliable access to food.
During the 18-month program a Fonkoze case manager visits CLM families weekly and provides the training and tools necessary for them to build income generating activities and take the first step out of poverty. CLM families receive the assets needed to start a business (animals or merchandise), materials to repair or reconstruct their home, a small cash stipend, a water filter and free healthcare. Successful CLM graduates are able to graduate into our smallest loan program and join other women in solidarity groups.
Fonkoze & Small Business
Fonkoze is in the process of a multi-year expansion of its Small & Medium Enterprise lending efforts. As Haiti continues to recover from the earthquake, we recognize the need of formal sector businesses to have access to loan capital to fulfill increasing demand and hire new workers. Fonkoze fills a need for funding in the ‘missing middle,’ the gap between microfinance and traditional commercial lending.
Innovation – MiCRO & Kore W
The hurricanes of 2008 and the devastating earthquake in 2010 left hundreds of thousands of Haitians with nothing. In addition to the overwhelming human toll, people lost their homes and business leaving them with nothing on which to rebuild a new life. We had clients who, over and over again, would build up their assets and make significant progress in our programs only to lose everything in the next natural disaster.
In 2011, Fonkoze & MercyCorps founded the Micro Catastrophe Risk Organization (MiCRO) to develop a risk transfer mechanism for our clients called Kore W, compensating Fonkoze’s clients when they lose merchandise or their home or place of business is damaged. The payout includes a loan cancellation, USD $125 and the opportunity to take out a brand new loan when the client is ready.