Haitians Unite: Fonkoze: The Bank For The Poor

Spotlight: Haitians Unite: Fonkoze: The Bank For The Poor

"When the fire-flies shine the way for one another, we will all succeed at developing the country." In our modern rat-race, we often lose sight of the big picture: we need each other. Regardless of how the modern human being fights this idea, we cannot escape its truth. Yes, we need each other to survive. Without the garbageman, our streets would be littered with waste; without the healer, our bodies would fall sick and die. Making millions of dollars is useless if the farmer refuses his work, for even the millionaire depends on the food produced by the farmers for his survival. We tend to see the business owner as more respectable than the street cleaner, the superstar sports player as a hero but the construction worker as low-class, and the governor as an authority but the housewife as а поп- productive part of society. Our tendency, to value one profession over another is simply barbaric and unfair, as a society cannot function without the contributions of every individual it serves. The quotation above reminds us of this reality that is too easy to overlook in our modern capitalistic mindset. The people of Haiti, however, have not forgotten this fundamental truth, and the Fonkoze bank has adopted this principle as one of its guiding pillars. 

Fondasyon Kole Zepol, or Fonkoze, (which means The Shoulder-to- Shoulder Foundation*) is a bank for the poor in Haiti. It is the largest micro- finance institution in the country, and through loaning small amounts of money to Haiti's underprivileged, the bank is truly making a difference in the lives of people throughout the country. 

A decade ago, Haiti was struggling for equality. The organized poor were targets unbelievable repression and were not allowed to access banks or financial services. If one was poor, one had very little chance of escaping poverty because funding of small business ventures was nonexistent. A group of grassroots leaders saw the need for real change, and thus organized themselves to create a bank of their own. Under the leadership of Father Joseph Phillippe, a Spiritan Priest and the founder of the Peasant Association of Fondwa, started Fonkoze. The group of 32 grassroots leaders launched the bank in 1994, and in 1995 the bank received recognition as a foundation under Haitian law. 

While funding small businesses is one of the main objectives of the organization, it is not the only focus. Fonkoze also provides educational opportunities, skills training, savings accounts, currency exchange, and other services. These programs provide a very positive opportunity for entrepreneurs and have helped change the lives of many Haitians over the years. 

FOUNDING PRINCIPLES 

Fonkoze's mission is to build the economic foundations of Haiti and to foster an atmosphere of social improvement in the country. Fonkoze is non-political and does not take positions on the political climate of Haiti. The principles of Fonkoze are:

Solidarity: “When all the fireflies shine the way for one another, we will succeed at developing the country". 

Priority to Women: "The liberation of women is the liberation of the family. When the women dish out the food, everyone eats." Women are the backbone of the Haitian economy. 

Credit is Not Enough: Credit is accompanied by training, advice, social programs, and follow-up 

Advantage: Everything offered is in the advantage of the client rather than the bank. 

Priority to Rural: "There are no outsiders - everyone is inside". 

Participation: Everyone should participate so that suffering can be overcome 

Transparency: Nothing is concealed from clients as far as the organization's activities 

Sustainability: The purpose is to benefit the poor, but the business aspects of the bank are also kept in high priority to guarantee its success and ability to provide services and support, without the need for continuous outside investors. 

We Grow as Clients Grow: Client feedback is necessary so their needs can be satisfied. 

PROGRAMS 

Fonkoze has four main programs: literacy, branch incubation, business development, the development of innovations in rural finance delivery. 

Illiteracy is reduced through an educational program that helps clients learn to read and write so that they will not be taken advantage of in the business world. Clients also have opportunities for business development and training in the best use of their loans. Sexual and reproductive health are also addressed by Fonkoze. 

Building new branches are always an interest for Fonkoze. New branches are brought to rural areas and poor communities regularly, because once a branch reaches profitability, Bank Fonkoze purchases another branch. 

Fonkoze Financial Services provide opportunities to generate self- reliance and harmony. Group and individual loans are granted to start or expand a business. Currency exchange services have been put into place that allow people to change US dollars into Haitian gourdes at a good rate. Money transfer services allow Haitians that live overseas to send funds to their families at a very low cost. 

As of March 31, 2004, Fonkoze had over $4.8 million in savings deposits and about $2.5 million in outstanding loans. Amazingly, loans that were overdue more than 30 days were less than 2%. 

FONKOZE USA 

Fonkoze USA was created in 1996 after Fonkoze organized a conference to bring micro-credit practitioners together in Miami. The work of Fonkoze needed to be financed, and it was not feasible to finance the loans out of the savings that people put into the bank because the demands for loans would quickly exceed the savings dollars that could be liquidized for investment. Fonkoze USA was conceived as a partner organization for the purpose of funding the bank. Notes for a Democratic Economy in Haiti were sold to individuals and organizations from the USA, and the proceeds went to fund micro-loans in Haiti. In essence, individuals or organizations loaned a minimum of $1000 to Fonkoze USA, who re-loaned the money to Fonkoze, who then loaned the money to Haitian entrepreneurs. 

The loan fund grew quickly, but because the Haitian gourd is of less value than the US dollar, a problem of repaying the loans occurred for Fonkoze. In the fall of 1999, Fonkoze applied to the United National Development Program to become a MicroStart grantee, and in 2000 they received financing and technical assistance through that organization. Other fundraising activities were done and this allowed the Fonkoze association to grow. 

CLIENT'S STORIES 

"My name is Rose Aesphie Seraphen, 1 am 32, and 1 am a member of Fonkoze. I have a stand in the market and sell everything from soap and shampoo to onions and fruit. It's my own business, and I work every day except Sunday. Since I have been getting loans at Fonkoze, I have been able to build a small stand and have all different kinds of merchandise. I have no problem paying school fees now. tell women about Fonkoze and how they can get loans". 

"My name is Robert Willeau Eliacin. I live in Maissade and have a business here, like my father. There are some people in Maissade and Ench that loan money, but I would never go to them. They charge 20% or more a month. Fonkoze's program is clear and simple. I am happy with my loan because with it I was able to restock my warehouse. When I repay this loan, I will take out another because it's good business to buy in bulk." 

About 96% of the clients of Fonkoze are female. As of March 31, 2004, the bank has had zero write-offs! As of 2003, Fonkoze had 24,990 loan clients with a value of a little over $1.1 million out in loans. With eighteen branch offices (as of 2003), Fonkoze stands strong as the backbone of change in Haiti.