Haiti is a land of micro-entrepreneurs. In every town, on every street, shopkeepers, traders and craftsmen are working hard to provide their communities with the essential goods and services of daily life — and in so doing, lift their own families from poverty.
In the remote village of Nathan, located in the southwestern part of Haiti, health services are limited. The nearest hospital is over two hours away and access to even basic first aid supplies requires a trip to the city of Les Cayes.
With training as a nurse, 48-year old Josette saw an opportunity for her family and community.
So three years ago, she applied for a loan with local microfinance institution Fonkoze, and opened her small business selling basic pharmaceuticals, such as Tylenol, Ibuprofen and rehydration salts.
Making a comeback — twice
Then the devastating earthquake of 2010 hit; Josette lost her husband and instantly became the sole provider for her three children. As cholera flared up during the rainy season, she also quickly became the first to see when one became ill and was on call 24 hours a day to offer immediate emergency care before people could get to the hospital.
Her family and neighbors were dependent on her business to keep them healthy and moving forward. And she made it work.
But just a year and a half later, in June 2011, heavy rains pummeled the southern part of Haiti, resulting in widespread flooding and mudslides that damaged many businesses. Josette lost three-quarters of her inventory, which threatened to ruin her livelihood. Instead of going under, however, Josette and nearly 4,000 other female business owners got help.
An innovative safety net
Through the Microinsurance Catastrophe Risk Organisation (MiCRO), these Fonkoze borrowers received an automatic payout of £93 and their outstanding loans were forgiven while they were pre-approved for new loans to restart their businesses when ready.
To help businesswomen like Josette — who often face more pressure (and more risk) as they try to support their children — gain greater financial security, Mercy Corps partnered with Fonkoze to cofound MiCRO. The innovative insurance programme offers both traditional coverage of losses, as well as an additional automatic payment that is triggered whenever a natural disaster of a specific magnitude occurs. In a place like Haiti — one of the world’s most vulnerable areas to hurricanes, floods and earthquakes — this additional safety net allows these small business to rebuild with little other resources.
During the 2011 hurricane season, a total of 5,385 Fonkoze borrowers across Haiti received £1 million in insurance benefits.
Josette’s microinsurance coverage allowed her to purchase the necessary supplies to get her business up and running again soon after the rains. She also played a vital role in the recovery and rebuilding of her community. As a “centre chief,” she oversees seven groups (35 women total) of Fonkoze clients in her area. She visited all of them within the first three days of the flood to take inventory of the damage and verified their claims, ensuring a quicker repayment process. The system is another key way that Fonkoze’s microfinance programme creates a support network around hardworking borrowers.
Recovering from a natural disaster is a painfully difficult process. For the uninsured, it can be nearly impossible. With MiCRO, we aim to support micro-entrepreneurs beyond just their initial loan, working to make sure their economic welfare is sustainable for the future. Though they may carry the entire burden of supporting their families with their businesses, when a crisis hits, they can be assured they are not alone.