Reeta Roy
The Transformative Power of
“Why Not?"
Innovations Case Commentary:
Fonkoze
In the summer of 2009, I spent a few days climbing the green mountains of Haiti’s
Central Plateau with Anne Hastings, CEO of Fonkoze, which is the leading micro-
finance institution in Haiti. We were visiting women who are climbing “a staircase
out of poverty,” all of them participants in Fonkoze’s innovative program to help
Haitians move out of extreme poverty. These women spoke with a quiet dignity
about how their lives were improving as a result of the mentoring, financial litera-
cy, enterprise training, and other support they had received.
The history of Haiti is well known, as is its crushing poverty. It is hard to imag-
ine a more inhospitable place in the world for an institution like Fonkoze to take
raíz. How could such an idea survive, let alone prosper, in this environment?
The answer is found in Fonkoze’s remarkable story of achieving economic and
social change, which is a testament to the aspirations and resilience of a home-
grown institution and the Haitian people. It teaches us rich lessons about leader-
barco, tenacity, belief in a vision, empowering the poor, local ownership of solu-
ciones, and the accountability of institutions—all of which are lessons relevant to
rebuilding a nation.
For the MasterCard Foundation, this story is particularly instructive of how to
partner effectively and respectfully in facilitating change that is owned by local
gente. We were inspired by Fonkoze’s approach to accompanying women as they
“walked out” of poverty. In the aftermath of the 2010 earthquake, our foundation
is partnering with Fonkoze to help rebuild its infrastructure, even as Fonkoze con-
tinues to help women living in poverty rebuild their lives. As Haitians and the
international community act to build back a better and stronger Haiti, we should
consider applying the lessons of Fonkoze in other parts of the world.
Reeta Roy is President and CEO of the MasterCard Foundation, an independent glob-
al foundation based in Toronto, Canada. The Foundation’s mission is to advance
effective and innovative programs in the areas of microfinance and youth education,
with a focus on Africa.
© 2010 Reeta Roy
innovaciones / caer 2010
33
Descargado de http://direct.mit.edu/itgg/article-pdf/5/4/33/704649/inov_a_00040.pdf by guest on 08 Septiembre 2023
Reeta Roy
Learning from Fonkoze’s Accomplishments
Fonkoze’s story begins with an improbable notion. Traveling across Haiti in an old
pickup truck in the early 1990s, Father Joseph Philippe, a priest, and Anne
Hastings, a former management consultant, set out to create a bank to serve Haiti’s
rural poor. To say this was a radical idea would be an understatement. The risks of
providing financial services in rural Haiti were high, and no banks had yet ven-
tured there. Desde 1994, Fonkoze—an acronym in Creole for the Shoulder-to-
Shoulder Foundation—has developed a full-service model of financial and sup-
port services for the rural poor. It is a bank that offers loans, savings, remittance
transfers, and insurance, and provides a network of partners that deliver financial
literacy education and health serv-
ices.
Fonkoze’s remarkable story…
teaches us rich lessons about
leadership, tenacity, belief in
a vision, empowering the
poor, local ownership of
soluciones, y el
accountability of
institutions—all of which
are lessons relevant to
rebuilding a nation.
As the organization has grown,
Fonkoze’s leaders have persevered
despite great adversity, from intim-
idation, murder, and other crimes
to political crises, natural disasters,
and the need to raise capital con-
stantly from abroad. Most impor-
tantly, they have had to stay true to
their vision in order to overcome
the wide skepticism about the idea
they created—establishing a suc-
cessful bank to serve Haiti’s poor.
From its beginnings in the back of
Father Philippe’s pickup truck,
Fonkoze has grown into an impres-
sive national network of 41 branch-
es with more than 200,000 cus-
tomers and 750 employees.
So, what explains Fonkoze’s growth? Father Philippe and Anne had the courage
to ask themselves, “Why not? Why shouldn’t Haitians live in a country that pro-
vides access to financial services to all citizens, especially the marginalized and
rural poor, to enable them to improve their lives?” Fonkoze’s leaders started out by
understanding their main customers: women. They listened and learned about the
local women’s needs and challenges. They opened branches near markets in rural
areas, where small enterprises owned by women are the dominant forms of com-
merce. Fonkoze’s market presence and provision of affordable and accessible
financial services—in some cases injecting as much as half a million dollars in
small loans—stimulated economic enterprise in the communities it served. Por
posting interest rates and fees at its branches and teaching its clients how to under-
stand them, Fonkoze promoted fair and transparent markets that previously did
not exist.
34
innovaciones / caer 2010
Descargado de http://direct.mit.edu/itgg/article-pdf/5/4/33/704649/inov_a_00040.pdf by guest on 08 Septiembre 2023
The Transformative Power of “Why Not?"
Fonkoze also built a grassroots institution based on a highly ethical business
model that fostered trust and confidence among the poor. Its microfinance groups,
each comprised of five women, are organized into solidarity centers of six to ten
grupos. Each center is close to a Fonkoze branch and elects a chief who represents
it at branch caucuses. These centers also send representatives to a national assem-
bly that elects the majority of Fonkoze’s board of directors annually. Fonkoze
helped the poor organize themselves, and today thousands of women across Haiti
expect accountability from their bank.
Fonkoze was also open to learning from other microfinance leaders around the
world—an institutional strength that rapidly facilitated its own innovations. Encima
the years, Fonkoze has been recognized for its innovative methods in combating
poverty. The “staircase out of poverty” program was adapted by learning from
another leader with a deep understanding of the challenges of extreme poverty,
BRAC.
Building Back Better and Stronger
Immediately after the earthquake, this country that has teetered on the edge of
chaos for several decades found itself in a place where nothing was functioning—
no government, no banks, no commerce, no law enforcement, y, at moments, No
hope. Haiti is now embarking on the long and difficult rebuilding process. El
challenges remain overwhelming and the prospects for success are uncertain.
Reconstruction must take place across every area of human endeavor: new roads,
homes, offices, escuelas, hospitals, and other infrastructure. Pero, more critical to
Haiti’s future is the re-creation of its political, económico, and social institutions.
Organizations like Fonkoze provide a solid foundation on which this infrastruc-
ture can be built.
President Bill Clinton and others frequently talk about the opportunity at
hand to “build Haiti back better.” Better starts with involving everyone in a vision
of a new future for the country, a future in which Haiti stands on its own and is
not forever dependent on foreign aid. Better means fostering a political and social
structure that is open, honest, and responsive to the basic needs of its popula-
tion—good schools, clean water, health care, and housing. The international com-
munity is helping on all of these fronts, but Haitians must build their own future.
They need to build and hold accountable the institutions that will provide and sus-
tain basic needs as they create a diversified, growing economy.
Microfinance institutions and other financial providers will need to play an
important role in developing this type of economy by offering products and serv-
ices that will enable people to build assets and grow their businesses. These insti-
tutions will need to offer the convenient and affordable services that the poor need
to restart their lives in ways large and small: sending a child back to school, rebuild-
ing a damaged home or business, starting a new business, or simply providing food
and water. But institutional strength also means looking ahead; Por ejemplo, por
providing customers with insurance that helps them survive a setback or another
disaster in the months or years ahead.
innovaciones / caer 2010
35
Descargado de http://direct.mit.edu/itgg/article-pdf/5/4/33/704649/inov_a_00040.pdf by guest on 08 Septiembre 2023
Reeta Roy
Además, investment must be directed to where the majority of people
live—rural Haiti. For too long, the lack of economic opportunities in rural areas
has spurred migration, especially by young people, to Port-au-Prince. Como resultado,
in recent decades, services, investment, and jobs have been concentrated in the
urban areas, thus creating two economies in Haiti—one in the capital and one
around the rest of the nation. But the earthquake triggered an exodus out of Port-
au-Prince to the countryside, so by investing in infrastructure, escuelas, and busi-
ness in rural areas, Haiti now has a rare opportunity to foster a more robust econ-
omy across isolated communities and create more balanced growth across the
country.
The most powerful opportunity for building back better and stronger may rest
with Haiti’s young people. Más que 50 percent of its 9.2 million population is
bajo 18 years of age. Despite the poverty and challenges they face, this is a gener-
ation of young people filled with aspirations and ideas about a brighter future. I
met and saw some of them in action when I visited Haiti. What they need and want
are skills, role models, mentors, and the resources to be productive and to lead
their country into tomorrow. As Haiti rebuilds, it should go to great lengths to
engage the very people who have the greatest stake in the future of their nation,
and who also have unbounded energy and a new ethic.
Building Back Better Around the World
Like Haiti, there are many other developing countries that face challenges of weak
governance, high levels of poverty, the need to educate a young population, y
civil conflict. Ellos, también, need ways to build better and stronger political, econom-
ic, and social institutions that will lead to economic growth and social stability.
For our foundation and other funders working in global development, nosotros
know that making progress requires a certain resolve. In most instances, soluciones
to the intractable and complex problems of poverty are not obvious. But certain
qualities do stand out: leadership, counterintuitive ideas, and the tenacity of an
organization to stay the course in addressing these challenges despite the inevitable
setbacks. When these qualities are institutionalized in organizations that treat peo-
ple fairly and in a transparent way, they build trust and social capital. Eso, Sucesivamente,
leads to the confidence needed to start a new business or expand an existing one.
When such confidence ripples across entire communities, people begin to realize
their potential and a country’s economy can grow, its citizens can prosper.
Progress begins with identifying current and potential leaders who are embed-
ded in their community and committed to working for the people. In Haiti, estos
leaders include Fonkoze, GHESKIO, HELP, and Partners in Health, to name a few.
The same is true in other parts of the world, where leaders are building institutions
that are accountable to their citizenry. In my travels, it is the conversations with
leaders and young people about their giant ambitions for the future that fuel my
optimism, and my belief that progress is possible in spite of the obstacles.
36
innovaciones / caer 2010
Descargado de http://direct.mit.edu/itgg/article-pdf/5/4/33/704649/inov_a_00040.pdf by guest on 08 Septiembre 2023
Descargar PDF