Fonkoze does not aim to lift poor Haitian families out of poverty. It aims, rather, to help the women who lead those families lift them out. This distinction is important. Fonkoze is not an aid agency, but a micro finance institution, one that helps its members assemble the skills, habits, and resources they need to carry their families forward.
Fonkoze offers access to credit to the women who are its members. This credit enables them to invest in their businesses and make them grow, along with educational programs that develop crucial life and business skills – like literacy and business skills, for example. Fonkoze is also beginning to facilitate access to health care, helping members learn to use the resources available to them in their home communities. These three kinds of services – financial, educational, and health – form a stable, triangular base, a strong foundation that women can build on.
But lifting their families out of poverty requires more than laying that foundation. A foundation is not a house. Building up a house – what we’re really talking about is building up a better life – requires leadership as well. And though we like to refer to people as “born leaders”, and though some of Fonkoze’s members surely deserve that label, most do not. Developing leadership among its members remains, and must remain, one of Fonkoze’s core objectives.
This simple fact is rich with implications for the design of Fonkoze’s programs. Though, for example, Fonkoze could hire qualified and experienced educators to teach its literacy classes, calling on the same ones year after year and thus minimizing its training costs and maximizing the competence of its team, it does not do so. Instead, it hires literate members, borrowers who do think of themselves as market women, not as educators, and helps them learn to share their knowledge with others around them. That may mean that teaching reading and writing is a little less efficient than it might otherwise be, but the chance to invite Fonkoze members to accept leadership positions, and to nurture their growth as they do so, is an opportunity too important to lose.
The results of that emphasis were on display in two separate meetings over the last couple of weeks. One was for credit center chiefs at Fonkoze’s Active Learning Center, in Lenbe. The other was a gathering of Fonkoze’s most successful borrowers in Kafou, the sprawling suburb south of the capital.
Fonkoze’s office in Lenbe is designed to promote learning in a number of respects. First, it is a fully functioning model branch office, with a staff specially selected from among Fonkoze’s best. With its attached residence hall, the branch becomes a convenient place to train new staff and to provide professional development to staff from other branches. Second, it has a staff trained to do field research, with a social impact monitor, who collects information about the effect of Fonkoze’s programs on its members, and an economic analyst, who studies the relative effectiveness of the different types of businesses that Fonkoze members engage in. Finally, it’s set up to manage experiments that test new ways for Fonkoze to serve its members.
The meeting at Lenbe brought together nine Fonkoze credit center chiefs to discuss a new approach to creating Fonkoze credit centers like the ones that they are part of. A credit center is, in some ways, the basic unit in solidarity group credit. It’s a collection of five-eight groups of five women. Centers meet regularly for disbursements and reimbursements of loans, and for educational programs. They are important because even with 36 offices throughout Haiti, Fonkoze isn’t close enough to where its members live and do business. The credit centers allow Fonkoze to serve members, even ones in very rural areas, in their own neighborhoods by sending credit agents on motorcycles to center meetings as far as two hours from the nearest Fonkoze office.
The keys to these centers are the women elected to lead them, the center chiefs. They are chosen by their fellow borrowers and have several important responsibilities. They advocate for borrowers, presenting their concerns at regional assemblies and, if elected from those assemblies, at the annual general assembly in Port au Prince as well. They are their credit agents’ primary means of contacting other center members. They even approve the size of the loans that each member of their center receives.
Center chief is a volunteer position, but it has its rewards. Marie Edel, a center chief from Lenbe put it well. “I’m a businesswomen. If the people around me have more money to spend, that’s good for more. Anything I can do to help my neighbors helps me too.” As a center chief, she is a force building the economy that surrounds her.
Our experiment involved asking selected center chiefs to expand their roles and offered them, for the first time, the chance to earn some money for their work for Fonkoze. We were asking them to take substantial responsibility for recruiting new members, not by encouraging women to join the credit centers that they already lead. This is something that they already do. We asking them instead to create whole new credit centers by recruiting women in groups of 25-40 at a time.
This would be a major shift for Fonkoze. New centers are currently opened by credit agents, and the way they tend to do it is not without substantial risks. What they tend to do is take their motorcycle to a new area that doesn’t have a credit center yet. They contact a community leader – a priest or pastor or a local politician – and ask him to help them organize a meeting of people that might be interested in credit. The credit agent introduces Fonkoze to those who attend the meeting, and uses follow-up visits to sign up new members in groups of five.
This entails two sorts of problems. On one hand, it’s a problem for the credit centers themselves. They can remain beholden in various ways to the man whom they think of as having brought Fonkoze to them. This hampers the women’s development as leaders. It weakens their position within their communities as it reinforces the position of the men who already have a lot of control. On the other hand, it’s a problem for Fonkoze as well. It feeds the credit agents’ tendency to move farther and farther from their bases, recruiting just the smallest percentage of potential members everywhere they go, rather than working to penetrate the potential market for Fonkoze credit. This maximizes Fonkoze’s costs per loan, already necessarily high. And there are other problems as well.
So we thought we’d see what credit center chiefs could do, without motorcycles, in the paces where they already live and work. They would get a cash payment for every complete center of 5-8 groups of five women they were able to recruit. This would tend to push a denser penetration of areas that Fonkoze already serves, and it would do so without bringing in interference from community leaders who can never be part of these centers. The program started in April, and our meeting at the end of July was a chance to talk about how things were going.
The data is clear enough. So far, 130 new members have been recruited, and two of the center chiefs have earned payments. But our meeting enabled us to go much deeper than such data.
The women were vocal in their excitement about the program, but also about the barriers they’re encountering to making it work. They spoke of competition from another micro finance institution, one that offers an approach that can seem, at first look, to be better for market women. They spoke of aspects of Fonkoze’s approach that can turn potential members off. And they spoke of reasons some market women give for avoiding any formal credit program at all.
What was most striking was that they were the ones that spoke. They did not come to a meeting at Fonkoze’s branch office looking for Fonkoze staff to answer their questions, but for an opportunity for dialogue with one another. In fact, the one time that they got an extended explanation from Fonkoze staff – I gave them a detailed account of where Fonkoze gets the capital it lends them – they complained that I was talking too much, that they could work things out on their own.
Those that had struggled with the new competition shared the problems they had discovered in its method of offering credit, problems that had convinced some women to choose Fonkoze instead. They talked about the realities behind some of the things that new members can dislike about Fonkoze’s method – why Fonkoze asks personal questions, why Fonkoze is relatively slow to get its credit to new borrowers, why Fonkoze’s first loans are relatively small – and brought up explanations for each that they think can be convincing.
And they defended their own interests as well. The criteria that determine whether they can be paid were poorly designed, and they negotiated a revision of them with the branch manager that will work better for them and, perhaps, for Fonkoze as well.
Not everything was purely positive. Of the fourteen women who were initially invited to participate in the program, only nine came to the meeting, and only two of them had succeeded in earning a payment thus far. But it’s a start, and they are confident that, within a couple of months, the numbers will look very different.
The meeting in Kafou was much larger and very different. It was a weekend gathering of almost 50 of Fonkoze’s most successful members. These are women who started with solidarity group loans of 1500 – 3000 gourds and are now managing individual loans of 50,000 – 100,000 gourds or more. (The current exchange rate is about 40 gourds to the dollars.)
We had invited them to the Kafou meeting to celebrate their success in a particular way. We wanted to talk with them about how one might be able to meet with a business women who’s not succeeding and help her understand how to turn her business around. We would then have a large group of struggling solidarity group borrowers come to Kafou for a half-day’s work with the more successful women. The more successful women would, in other words, become unpaid business consultants.
What was initially most striking was seeing how the women relished the opportunity we were offering them. They are rightly and vocally proud of what they have accomplished, and they’re not too shy to admit that they’re good at what they do. They were excited about an invitation to share their know-how.
In a sense, that’s not surprising. Why wouldn’t they be glad for the recognition? At the same time, they were very clear about the thought that I quoted Marie Edel as expressing. These women, when asked what the barriers to their own further success are, listed their neighbors’ ability to run their businesses well as one of the more important ones. They know that they can move farther if their neighbors are moving forward too.
So when we welcomed twenty-five struggling market women to join us Saturday afternoon, they all got right to work. We paired one or two of the successful women with each of the struggling women, choosing women from the same part of Haiti, and they spent the rest of the day talking. They spoke of how they were managing their businesses and their households. They talked about how they partnered with the men in their lives, or how they managed if they had no stable partner. They exchanged thoughts about the particular businesses they are in or about special challenges they are facing of whatever sort.
Fonkoze staff stayed out of these conversations. We wanted to create an environment in which the women would look to one another, and I think we succeeded well.
There’s much more work left to do. The successful women said they would be willing to serve as consultants for women in their home communities, and Fonkoze will need to follow up to make sure the opportunities arise. We’ll also want to check to see whether the advice that the women give actually helps the women who receive it. But the heart of the matter, that Fonkoze women are willing and able to take the lead as they do their work, is in pretty good shape.