Post-Disaster and Post-Conflict Microfinance: Best Practices in Light of Fonkoze's Experience in Haiti

This paper was commissioned by the Microcredit Summit Campaign in 2006. The paper describes Fonkoze's experience in Haiti, and lists the best practices for implementing microfinance in a post-disaster situation.It discusses:

• The poverty in Haiti;
• The conflict and natural disasters in Haiti in the year 2003-2004;
• The objectives and activities of Fonkoze - Haiti's largest microfinance institution (MFI);
• Fonkoze's response to conflict, describing:
  • Its partnership with 'Concern Worldwide' to help repair local supply chains that were broken during the socio-political problems at the end of 2003,
  • Its response to flooding in Gonaives.

The paper presents the following review of best practices in post disaster/post conflict situations, stating that the MFI should:

• Develop a business plan to analyze disaster risk factors and outline a strategy of response in the event of a disaster;
• Develop contingency plans to cope with the resurgence of conflict/natural disaster and train staff for implementing it;
• Prepare poor people to use microfinance services and establish a strong repayment culture;
• Develop products and services aimed at disaster risk reduction;
• Advocate, create, and strengthen partnerships;
• Establish logistical challenges before embarking on any action;
• Create both short-term and long-term plans to manage crisis;
• Provide relief and back-to-work assistance to employees;
• Respond to clients on a case-to-case basis;
• Separate microfinance from relief activities.

The paper concludes by listing lessons learned from Fonkoze's experience.