Haiti MSME is a financial sector service project designed to facilitate transactions between the demanders and suppliers of financial services through supply-oriented interventions. From its start in July 2006, Haiti MSME has promoted a vision of improving livelihoods by broadening access to sustainable financial services. Project activities leveraged prior USAID financial sector and enterprise development projects to reach a target population that includes both potential generators of income and livelihoods, such as rural and agricultural MSMEs, market-oriented enterprises, microenterprises, and the poor and vulnerable populations.
The project encouraged innovative financial services to the target population through its project intermediaries, including microfinance institutions (MFIs), caisses populaires, commercial banks, financial service associations, and producer groups and associations. Project activities jump-started product development and expansion initiatives, solidified financial institution capacity, and encouraged financial linkages between the financial sector and USAID-supported sectors and beneficiaries.
Haiti MSME contract objectives remain unchanged from year one to year two. However, as Haiti MSME entered its second year of implementation, DAI and USAID revised the project’s strategy to better ensure that the project objectives are met. Under its Year 2 work plan, Haiti MSME will improve the capacity of a group of Core Partners, namely strong microfinance institutions (MFIs), banks receiving DCA support, and USAID-supported caisses populaires (MSME CP), to design and deliver appropriate financial products.
The project role in creating linkages between the supply and demand sides for financial services has been formalized via the creation of an Inter Project Coordinating Committee on Finance, which Haiti MSME leads. Through this mechanism, the focus is on creating linkages to deliver financial services to bankable enterprises from USAID’s productive enterprise projects, including MarChe, DEED, MYAP, IDEJEN, and KATA.
Haiti MSME objectives are clearly identified: Supply Enhancement, Enabling Environment, Supply Expansion, and Linkages. The role of Haiti MSME in facilitating the provision of financial services and promoting financial linkages is illustrated in a graphic provided below. The graphic shows the Core Institutions, Financial Services Suppliers, and Demanders of Financial Services, as well as the Bankable Enterprises and Market Information.
The Haitian microfinance sector has passed through its initial phase and is evolving into a more dynamic and mature sector. The overall urban concentration and small commerce orientation of most of the credit portfolio is reflective of the initial phase of urban-based institutions focusing on the easier to reach and safer urban markets with simple, often single products. However, as Haiti is regaining security and stability, confidence is building, and the Haitian microfinance sector is well positioned to emerge into its second phase, characterized by continued growth and consolidation shaping an evolution into a more diversified base.
Strong institutions with excellent managers are the basis for a sustainable expansion of financial services and improved access to those services for more of the population. During the year, Haiti MSME worked under this objective to build the capacity of microfinance institutions and other financial service providers to deliver financial services to priority geographic areas and productive micro, small, and medium enterprises (MSMEs). The project provided technical assistance and training to strengthen the operational and technical capacity of MFIs and other financial service providers.
The project also worked to improve the enabling environment for microfinance by providing guidance for improving the regulatory framework and reducing information asymmetries between financial demand and supply. Additionally, the project promoted the development of new products that meet the diverse needs of MSMEs and encouraged service expansion. The project’s efforts to reduce information asymmetries between financial demand and supply and create linkages between USAID-supported enterprises and the Haitian financial sector have been successful, with a significant increase in the number of MSMEs accessing financial services.
The project’s achievements under Objective 1 include the strengthening of the capacity of microfinance institutions and other financial service providers to deliver financial services to priority geographic areas and productive MSMEs. The project also made significant progress in improving the enabling environment for microfinance, including the development of a regulatory framework that supports the growth of the microfinance sector.
The project’s achievements under Objective 2 include the development of new products that meet the diverse needs of MSMEs and the encouragement of service expansion. The project also made significant progress in reducing information asymmetries between financial demand and supply and creating linkages between USAID-supported enterprises and the Haitian financial sector.
The project’s achievements under Objective 3 include the promotion of the development of new products that meet the diverse needs of MSMEs and the encouragement of service expansion. The project also made significant progress in improving the operational and technical capacity of MFIs and other financial service providers to support the growth and diversification of the microfinance sector.
The project’s achievements under Objective 4 include the creation of linkages between USAID-supported enterprises and the Haitian financial sector and the reduction of information asymmetries between financial demand and supply. The project also made significant progress in promoting the development of new products that meet the