FINCA Haiti Announces Approval of Savings Licenses
While revolutionary technological advancements have progressed in the financial sector globally, numerous developing countries have been struggling to provide their citizens with essential access to financial products. FINCA Canada, in partnership with the Government of Canada, has recognized a widening divide within the Haitian population between those supported and under-supported by financial institutions. The Financial Inclusion Project, among other forms of research, has provided a deeper analysis of the spending and savings habits of those living in underdeveloped populations, highlighting limited accessibility of financial services, such as savings programs, as a top constraint to accomplishing economic prosperity.
Over the last five years, FINCA Canada has distinguished the financial barriers associated with the people of Haiti as they continue to battle through this economic recovery. For years, Haitians have been subjected to banking services beyond their reach, as most banking operations take place in Port-au-Prince, limiting access to those in the surrounding rural areas. Without the help of banks, those in need of savings or financial support opt for loan sharks with higher rates that feedback within the cycle of poverty.
Providing Haitians with a reliable alternative
In August 2020, the Haitian Government implemented new regulations for microfinance institutions, which allow them to provide and operate savings accounts for clients directly. FINCA Haiti is among the few institutions that were granted this savings license and is currently developing a savings mobilization strategy that will increase the deployment of savings through FINCA branches, MonCash banking agents and partner banks. After successfully establishing a savings structure, FINCA Haiti served its first institutional Term Deposit client in August 2022 for an amount of 100M HTG ($862,891 USD).
In addition to term deposits, FINCA Haiti has recently developed two other savings products – current accounts and savings accounts (including a new micro-savings product) – which will soon be available in all its branches. When properly used, FINCA’s financial products are great tools for beneficiaries to improve their financial health, control their economic future and raise their standard of living.
Establishing availability, security and trust
In countries like Haiti, where traditional financial service providers are not available or accessible to many citizens, microfinance providers have become a more viable alternative with their smaller transactions and amounts.
Microfinance institutions normally cater to small businesses and individuals. They issue small loans that could be used to cover immediate personal and business costs. The smaller transaction sizes and repayable sums allow microfinance institutions to keep rates lower than defaults in major banks.
As an alternative bank for marginalized customers, microfinance institutions help alleviate the country’s extreme poverty by offering affordable loans to those with immediate needs.
To encourage more Haitians to leverage its key financial services, FINCA is committed to continuing to provide Haitians with financial literacy programs that will highlight the benefits of utilizing financial tools available in the market.
Gender inequality in the forms of financial and economic exclusion continues to be an obstacle for women in Haiti. As such, FINCA’s Financial Inclusion Project aims to mitigate these barriers by continuing to provide financial products that suit gender-centric and low-income needs.
By offering client-centred, gender-equal and human-rights-focused financial tools, FINCA aims to continue helping Haitians achieve financial independence and resilience today and for years to come.
Click here to learn more about how the FINCA Canada Financial Inclusion Project has developed and promoted economic prosperity for low-income women and men in Haiti and the DRC through microfinance institutions, technology and training.