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Chemin Levi Miyo: A Pathway for the Poorest

Chemin Levi Miyo: A Pathway for the Poorest. Karishma Huda Savings and Credit Forum 3 December 2009. Fonkoze: The Shoulder to Shoulder Foundation. Founded in 1994 by : Anne Hastings and Father Joseph 750 employees 200,195 clients (savers and borrowers) Portfolio volume: $10.2 million

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Chemin Levi Miyo: A Pathway for the Poorest

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  1. Chemin Levi Miyo:A Pathway for the Poorest Karishma Huda Savings and Credit Forum 3 December 2009

  2. Fonkoze: The Shoulder to Shoulder Foundation • Founded in 1994 by : Anne Hastings and Father Joseph • 750 employees • 200,195 clients (savers and borrowers) • Portfolio volume: $10.2 million • Solidarity and individual lending, remittances, savings, graduation program, adult literacy, health education, micro-insurance • Building the economic foundations for democracy in Haiti by providing the rural poor with the tools they need to lift themselves out of poverty.

  3. Haiti – A Fragile State • Most impoverished country in the Northern Hemisphere • 50% of the population live on less than $1/day and can be characterised as extreme poor • For every 100,000 births, 523 women died • Over 40% of population is illiterate LACK OF SOCIAL SAFETY NETS

  4. Voices of Extreme Poverty “When I was pregnant, I ate white earth to feed the baby inside of me. Sometimes I would scratch the wall with a spoon and eat what came off it. Then I would drink a little water. My husband did the same thing” “I would buy on credit from one vendor to feed my kids, then buy from another market the next day. I had to, I couldn’t afford to repay. The vendors would come to my house and swear at me – I wouldn’t go out of the house. I was scared”

  5. Need for a strategic change… Fonkoze was selecting (and selected by) microfinance clients that looked like this...

  6. Need for a strategic change… Rather than the extreme poor, like this...

  7. A Graduation Pathway • Regardless of where our clients start, Fonkoze offers them a range of services to keep them on the ladder. We cannot make the climb for them but we can accompany clients to keep them from falling off.

  8. A Graduation Pathway Chemin Levi Mayo: Road to a better life... • Reaches out the poorest of the poor funded by CGAP and Concern • Accompanies for 2 years with training, one-on-one supervision and encouragement, confidence building and other services like health care and home repair. • Provides some initial assets to starts their own microenterprise.

  9. A Graduation Pathway Ti Kredi (Little credit) • For Families that are not ready for large loans • Loan range $25 to $75 • Shorter repayments periods, additional support from loan officer and literacy class

  10. A Graduation Pathway Solidarity Group (Core program) • Groups of 5 friends form solidarity groups and take a loan together. • Groups are part of a Credit Centers of 30-40 women - long term associations of women devoted to individual and community economic & social development. • Loans range from $75 to $1300 for 6 months.

  11. A Graduation Pathway Business Development Level • Year-long loans from $1300 to $25,000 & More • Clients are part of a formal economy and create jobs in rural Haiti where there is little employment.

  12. CLM Specifics • Financing: Pilot - Concern Worldwide and CGAP; Scale-up - Concern Worldwide, Fonkoze USA, TiMoun Foundation • Implementing partners: BRAC, Concern Worldwide • Funding: ~ $375,000 (scale-up) • Number of beneficiaries: 250 (scale-up)

  13. Targeting Methodology

  14. Characteristics of the Families Selected • Extremely poor women • Between the ages of 18 to 75 • 4-10 dependents • No productive assets • Food insecure with hunger • High incidence of childhood malnutrition • Excluded: women too old, too sick, too handicapped to work or tend animals & women with no dependents

  15. Program Inputs 18 months of support

  16. Program Impacts Changes in poverty scores

  17. Food Security Impacts

  18. Graduation Results Graduation Criteria 95% of members graduated, and 75% took their first loan

  19. Voices of the graduates “At baseline, I was drowning. Halfway through the program I had goats, chickens and a stipend. I climbed to the second step. Then I took a loan, grew my business. My kids are in school, and I have 7 goats. So now I am on the 6th step. I’m not at the top yet, but I continue to climb. The next time you see me, I promise to God that I will be there!”

  20. Risks and Challenges • External shocks: food price increases, hurricanes • Limited enterprise options, chicken epidemic • Securing funding • Health, health, health

  21. Replicability • Scale up in BoukanKare: Partners in Health • 250 families, with the goal of reaching 1,000 • Cost at $1100/household, biggest challenge

  22. Recommendations and Lessons Learnt • Commerce is essential • Case management is most important ingredient • Striking the balance between individualisation and customisation • Need for financial literacy • Flexibility in stipend use • Be responsive, without veering too far from the program pathway

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