“This is a once-only opportunity to build a whole new country from scratch, perhaps to offer something of the good wishes the new nation should have been given 200 years ago,” writes AA Gill in the London Times, in a gut-wrenching account of living conditions in Haiti today, three months after a crushingly destructive earthquake that was followed by dozens of aftershocks.
And, Fonkoze, aims to help that rebuilding. Fonkoze, Haiti’s largest microfinance provider, along with a $4.5 million grant from the Mastercard Foundation made on April 20, hopes to spur the economy from the ground up by enabling the poorest of the country’s women to rebuild or create livelihoods. (Watch a video of Fonkoze and its work in Haiti.)
Why focus on women?
Gill notes that the quake “was a women’s tragedy,” because many were in their homes cooking in the late afternoon when the earth trembled and structures fell apart akin to card houses. “It was of course a nation’s tragedy, but it [leans] particularly heavily on women,” he adds.
What will the grants provide?
The Mastercard Foundation grant funds will be used to help provide enterprise training; assets such as goats and chickens; stipends; and mentoring to 1,000 women. It will offer small loans and financial counseling to another 4,000 women. And some of the funds will be used to help restore Fonkoze’s core operations, which were badly damaged by the quake.
The women’s program, which has already gone through a pilot phase and is now ready to scale up, costs $1,500 per family, according to Ann Hastings, Fonkoze’s CEO. “Based on our surveys, we believe about 143,650 households in Haiti would qualify for this program,” she adds. “That would cost about $215 million, although the cost per family could go down with efficiencies of scale.”
The Mennonite Economic Development Associates will provide oversight of the program. MEDA, a group that invests in the lives of poor families around the world, will manage the funding and provide periodic progress reports and some advisory services. MEDA itself has a $500,000 investment in Fonkoze, and is represented on its board of directors. The group has also raised $30,000 to help Fonkoze further re-establish itself after the earthquake, and “works with Fonkoze to determine how to best apply funds donated, and will also help with advisory services and any technical assistance required,” according to the MEDA website.
“People living in poverty can change their lives in the long-term with needed, short-term assistance,” asserts Reeta Roy, president and CEO of The MasterCard Foundation.
Unlike traditional philanthropy, “microfinance provides people who are living in poverty a means to build assets and generate income by starting a business,” explains Roy, which also donates to other microfinancing projects. “It’s not a hand-out, it’s a hand up that enables people to use their own resourcefulness to create more sustainable livelihoods,” she adds.
The Mastercard foundation has made other investments in microfinancing projects. Among them are endeavors in Uganda, where it partnered with BRAC and invested $19.6 million, sub-Saharan Africa, where it partnered with Opportunity International Canada and invested $8 million, and Egypt and Morocco, where it partnered with MEDA and invested $5 million.
Roy travels to the places where the foundation makes investments. “I met people in our program [who] measured change in simple and powerful terms: going from chronic hunger to eating twice a day, doubling the number of chickens or eggs sold in the market, to their ability to cover school fees for their children,” she says.