The US government has facilitated a USD 2 million transfer in reserves from City National Bank of New Jersey (CNB) to 34 branches of Fonkoze, a Haitian microfinance institution (MFI) that had been running low on cash since the January 12 earthquake. According to an article released by the US government, “Fonkoze was the only bank able to stay open for customers making withdrawals and receiving money transfers” following the earthquake.

The funds were transferred from CNB to JP Morgan in Miami and divided into 34 packets of cash. A military aircraft delivered the cash from Miami to Haiti, where it was distributed by military helicopter to Fonkoze’s 34 branches.

“Fonkoze is essentially the way in which Haiti’s most vulnerable populations get cash. They have a reach in that population that it would take years to recreate if they went under. As a priority of stabilizing the banking sector, Fonkoze matters as much, if not more than recapitalizing the Citibanks and Sogebanks,” said Ms Jennifer Harris, a member of Secretary of State Hillary Clinton’s policy planning staff. Fonkoze serves over 55,000 women borrowers, more than 175,000 savers and one million families who receive remittances from abroad.

By: Stefanie Rubin, Research Assistant

About Fonkoze:

Fonkoze was established in Haiti in 1995 with the mission of “building the economic foundations for democracy in Haiti by providing the rural poor with the tools they need to lift themselves out of poverty.”

Fonkoze is comprised of three institutions: Fonkoze, Fonkoze Financial Services (FFS) and Fonkoze USA. Fonkoze is a non-profit microfinance institution that opens and builds new branches. FFS is a commercial MFI that expands the branches established by Fonkoze. Fonkoze USA channels financial and technical support to its Haitian partners.

As of 2008, Fonkoze and FFS served over 50,000 borrowers and had over 100,000 depositors, making it the largest Haitian MFI listed on the MIX Market, the microfinance information clearinghouse. As of 2008, Fonkoze had a gross loan portfolio of USD 4 million; FFS has a gross loan portfolio of USD 8.2 million.

Additional Resources:

Source Article: America.gov: “United States Flies Cash to Haitian Microfinance Bank,” http://www.america.gov/st/business-english/2010/January/20100125173456berehellek0.4566767.html

The MIX Market: Fonkoze: http://www.mixmarket.org/mfi/fonkoze

MicroCapital Universe: Fonkoze: http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Fonkoze

Fonkoze: http://www.fonkoze.org/