> Posted by Beth Rhyne
This week I had the pleasure of attending a fundraiser for Fonkoze, the largest microfinance institution in Haiti, to mark the anniversary of Haiti’s devastating earthquake. What I saw in the testimony of the leaders, partners,and staff of Fonkoze demonstrated the spirit of Haitians: They take the worst life has to throw at them and still resolve to rebuild and even celebrate.
But the earthquake was not the focus of the event. Rather, it highlighted Fonkoze’s Chemen Lavi Miyo program, which identifies the very poorest people in villages and provides intensive support to help them get on the “Road to a Better Life”. This is the program Nicholas Kristof wrote about recently in his op-ed column in the New York Times, “Ladders for the Poor” – and spoke about with great enthusiasm at the fundraiser.
The Chemen Lavi Miyo program, I learned, was modeled explicitly on BRAC’s Targeting the Ultra-Poor Program in Bangladesh, which has reached 800,000 families since it began in 2002. It was one of ten replication efforts supported by CGAP and the Ford Foundation to spread the methods of the Ultra-Poor program around the world. Elizabeth Littlefield, former CEO of CGAP, used the term “super poor” to note that not only does the program reach out to the very poorest women, but it helps those women make super-human efforts to improve their lives.
Here’s briefly how it works: The poorest clients in a village, those too poor to use standard microfinance services, are identified and asked to join the program. For the next 18 months, each person receives intensive support including free health care; assets necessary to establish two or three very basic income-generating activities (like a few chicks, a goat or some tools); materials to improve or construct a basic home (with latrine and water filter); a weekly cash stipend for the first six months; and weekly visits from a caseworker who brings training in life skills, enterprise management, health, and nutrition. At the end of the 18 months the client is expected to be ready to join a group credit program in order to assist her with keeping her business going. Based on positive initial results – 143 of 150 clients graduated – Fonkoze’s pilot program will be scaled up to reach several thousand families.
Graduation programs like Chemen Lavi Miyo for the poorest people require a subsidy – donated cash – to keep them going, and so they cannot be provided by commercial microfinance institutions, although some commercial microfinance providers have non-profit arms that can operate such programs. I wanted to know how much it cost per client, but no one at the fundraiser had that answer on the tip of their tongue. Anne Hastings later informed me that although it is only a few hundred dollars in Bangladesh, conditions in Haiti (like poor infrastructure across the mountainous terrain and island-economy food importation costs) send the figure up to about $1,500 – still a good investment if the graduation rate is as high as claimed.