Micro and small enterprises in Haiti, especially those located outside the capital city, Port-au-Prince, tend to have very few accessible sources of affordable and specialized financing. While the Haitian microfinance industry has been growing in recent years, it still faces challenges on many fronts, including an insufficient number of service providers, and a limited range of services offered. This lack of access to credit is a serious constraint on the growth of the micro and small enterprise sectors in the country.
In order to improve access to new economic opportunities for micro and small enterprises in Haiti, the Multilateral Investment Fund (MIF), a member of the Inter-American Development Bank Group, has approved its an equity investment in the microfinance institution ACME (Action pour la Cooperation avec la Microentreprise S.A.), and will also provide a $600,000 technical assistance grant. This is the first equity investment that the MIF will make in Haiti. The project’s purpose is to help improve ACME’s equity base to expand its operations, and strengthen its institutional capabilities to better serve its clients.
While the investment will enable ACME to carry out its expansion and outreach program, the technical cooperation will help to further strengthen its governance and operations and improve specific areas of its microfinance services. By making its first direct equity investment in Haiti, the MIF sets a strong example to other investors with interest in tapping into frontier market countries.
Over 50,000 Haitian micro and small enterprises that currently lack access to affordable financial services are expected to benefit from income generating activities supported by the loans, as well as from increased income from jobs created or maintained in these enterprises.
This project is considered strategic for several reasons. First, it will be implemented in a country where the microfinance industry is still faces challenges to respond to the needs of its market. Second, it will help to expand financial services beyond the capital city, Port-au-Prince, to other regions in the country, potentially yielding significant social and economic benefits. Third, it will help to upgrade microfinance standards in the local industry through demonstration effects. Lastly, it will generate demonstration effects for the rest of the industry, becoming a model for other MFIs and private financial sector actors interested in expanding operations.
By helping ACME, the MIF honors its commitment to the peoples of Latin America and the Caribbean to considerably enhance their lives via improving access to high quality financial services.