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News tagged as "food security"
September 26, 2013

Microcredit in kind: an opportunity for the most excluded rural communities

Tags: microcredit in kind, micro farm, Haiti, revolving fund, access to credit, food security, farming tools bank | by Linda Facchinetti, Director Fundacion Nantik Lum

Noel Clautide lives in a mud house with a tin roof in a small rural village in the municipality of Balan, Haiti. She is a widow and has eight children. Five of them are deaf and mute and share their mother´s house with their own children. Their husbands abandoned them because of their disability. In Balan, as in most rural dwellings in Haiti, communities do not have access to water, electricity or proper sanitation services nor the local government has a plan to improve the current situation. In October 2012, Noel Clautide and her family survived hurricane Isaac and managed to save their house from collapsing thanks to a wooden pole borrowed from a neighbour. What is the opportunity that access to microcredit generates for women forgotten and in need like Noel Clautide?

(Photo: Noel Clautide with Beneco Enecia, head of Cedeso) 

The condition of extreme vulnerability of these women makes it necessary the use microcredits in kind, a new tool which consists in delivering directly to them consumer goods, tools, seeds or animals which have been previously selected and purchased in the local markets.

Microcredits in kind are especially effective when employed with very vulnerable populations who are not able to cater for their families´ basic needs or who do not have sufficient resources or knowledge to travel to the local market and purchase the goods they need to develop their micro businesses. 

Through the microcredit facility in kind, Noel Clautide received three goats which she raised for consumption and trade. Another 162 women participated to the initiative. They received goats and/or green beans seeds following approval of their application by the credit committee whose members are local communities leaders supported and trained by local professionals. 

One of the key objectives of this project consisted in providing food security to rural families in extreme poverty. Another stated objective was the generation of income through the sale of products from the micro farms in order to ensure their sustainability, thus improving the living conditions of the communities in the West Department of Haiti.

(Photo: first delivery of green beans seeds) 

Access to credit in kind works like an injection of capital in a farm so that, after several production cycles, the farmer is able to pay back in kind to the Fund the credit received (plus an ´interest´, also in kind). The monies accumulated may thus be disbursed as new micro credits in kind to other families in the community. This process achieves the constant rotation of the Fund. In order to maximize the impact of the Fund in the long term, the Haiti project included not only access to credit but also support to community-based organization and its leadership in the decisions relating the management of the Fund in kind so that this activity may be taken over by the communities without the need for constant external technical assistance.

In addition, we also worked to advance participants’ technical knowledge through training courses on farming techniques and small farms management with the objective to improve farmers’ skills in these areas. We must also remember that progress in the self awareness and empowerment of the women who participated to this action and who fulfill a triple role as mothers, workers and active participants to community life, represents a key strengthening factor for them as it helps them become agents for change and of community development. 

(Foto: protect banner in creole, Balan school)

After over twelve months since this proyect was launched, we can already detect two important signs of success. Firstly, more that forty farmers have applied for their second microcredit in kind; secondly, and not less important, the project has secured additional funding to set up a Farming Tools Bank which will rotate amongst the micro farms who have received a microcredit in kind, applying the same methodology. 

Through access to a microcredit along with training in Haiti, we can deliver opportunities to resolute and hard working women like Noel Clautide, who are the first to get up and the last ones to go to bed.  Stronger community awareness, social cohesion and socio-economic inclusion of women and their families represent some of the positive outcomes of micro finance. Noel Clautide is very special, but there are millions of stories of women who possess the abilities and who long for helping their families and communities but lack the opportunity. Micro credits in kind are the solution for many of them. 

This project and the Agricultural Tools Bank were managed by Fundaciòn Nantik Lum. Both initiatives were made possible by the generosity of Clifford Chance and the collaboration of the Haitian-Dominican NGO Cedeso.

Initiative financed by: Initiative financed by AECID
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