Situation Overview

On August 14, 2021, a 7.2 magnitude earthquake struck Haiti’s southern peninsula, affecting the South, Grand-Anse and Nippes Departments. Less than three days after the earthquake, Tropical Depression Grace arrived with 35mph winds, dumping rain on the region at a rate of 2 inches per hour. This is the same region that was devastated by Hurricane Matthew in 2016, with a lingering memory of the 2010 magnitude 7 earthquake, which killed 220,000. The reported total number of people affected by the August 2021 earthquake was 800,000, and the death toll was approximately 2,200 with hundreds still missing. Additional reports include 650,000 in need of humanitarian assistance; the damage and destruction of over 137,000  houses. Tropical Depression Grace hit the Southeast Department, where 615 homes were flooded. The disasters struck as Haiti was already reeling from a sociopolitical crisis. On July 7, President Jovenel Moise was assassinated, exacerbating instability and gang violence in the country.

Understanding Who We Are

Since its founding in 1994, Fonkoze has taken a comprehensive approach to alleviating poverty in Haiti. With over 60,000 borrowing clients and 170,000 savings clients nationwide, Sèvis Finansye Fonkoze (SFF or Fonkoze Financial Services) is Haiti’s leading microfinance institution. The Fondasyon Kole Zepol (Fonkoze Foundation), the nonprofit sister organization to SFF, reinforces microfinance activities by providing additional support to clients and their communities, such as adult education; health screening and information; and a "graduation approach" program for households in ultra-poverty. Fonkoze USA is the 501c3 partner to SFF and the Fonkoze Foundation. Learn more about who we are here.

Fonkoze is not a humanitarian relief organization. Our added value has always been in long-term recovery and development; as the immediate crisis subsides, and as aid agencies move on, Fonkoze remains to support clients and communities—many of which we have been supporting for more than 10, even 20, years. We are, however, committed to supporting our clients and their communities when the going gets tough. For 28 years, Fonkoze has all too often had to contribute to response and recovery when Haiti was confronted with shocks, including Hurricane Jeanne (2004); Hurricanes Fay, Gustav, Hanna and Ike (2008); the Haiti Earthquake (2010); Hurricanes Sandy and Isaac (2012); and Hurricane Matthew (2016).

The Impact

The day after the earthquake, Fonkoze sent a team to conduct an assessment of the impact on our clients and on the region. The team is assessing urgent needs but is also keeping an eye to future recovery--a measured approach with a long-term view. Results and data are still trickling in; we expect assessments to be complete by the first week in September. Thus far, we know the following:

• All of Fonkoze’s nearly 1,000 staff members are accounted for, including the 122 staff in the affected region. Unfortunately, many have lost homes and family members.
• There are 12,146 borrowing clients in the immediately affected area, including the branch regions of Aken, Okay, Bomon, Jeremi, Okoto, Miragwan, and Ti Rivye d’Nip.1 Unfortunately, our assessment has identified the passing of several clients.
• Fonkoze has 453 “Solidarity Credit Centers” in the immediately affected area. These are touchpoints in rural, isolated areas that can be leveraged to bring support and aid to remote populations.
• The outstanding loan portfolio was $3,718,881 in the affected region.
• Fonkoze Foundation has been reaching out to its team of 268 Community Health Entrepreneurs (women leaders amongst the microcredit clients and franchisees of the Boutik Sante social enterprise) in the region; thus far, they have been able to contact 164 (phone signals have been disrupted, especially near Jeremi). Of these, 50 lost their homes and 22 sustained damage to their homes. Many have lost family members and friends.
• In Haiti’s Southeast Department, Fonkoze Foundation’s ultra-poverty alleviation program (Chemen Lavi Miyo, CLM) has been serving 950 families in ultra-poverty. Parts of the region may have been affected by the earthquake as well as by Tropical Depression Grace. Unfortunately, swollen rivers have prevented teams from reaching many of the households to assess damage.
• Ten branch offices in the area sustained structural damage, of which three were assessed as now being hazardous (Bomon, Nip, Okay), and one (Aken) was assessed as being dangerous.  As appropriate, branch offices sustaining serious damage have undertaken measures to reinforce structures with rebar or to move operations to new/temporary locations.

Our Immediate Response

The team continues to explore the most appropriate response to clients’ and communities’ needs, ensuring coordination and collaboration with other entities, including the Direction de la Protection Civile (DPC) and the Ministère de la Santé Publique et de la Population. One of our first priorities will be to participate in the efforts of the DPC to identify all the victims of the earthquake by collecting information on our clients and, with their approval, pass on the information on those who were affected to the DPC. At present, we are either considering, in the process of doing, or will implement the following actions:

• Jumpstarting the local economy: During disasters, key intermediate traders/producers are often hardest hit.  They lose their inventory, their storage or production capacity or their capital as their clients, who often buy on credit, can’t repay them. Providing them with specially tailored loans to restart their business is key to restoring supply chains and production capacity in the affected areas.  SFF will offer these loans to existing and new clients.
• Distribution of hygiene kits: Through our network of CHEs, we will distribute hygiene kits to all 13,000 clients in the affected region.  Kits will include buckets, oral rehydration salt, water purification tablets, antibacterial soap, toothpaste and brushes, hand sanitizer, disinfectant, alcohol pads, menstrual pads, acetaminophen, toilet paper and diapers. Cost: $40/kit
• Support to CHEs: the Boutik Sante team will support the recapitalization of CHEs in the affected areas; they will receive Boutik Sante inventory of the same value as their latest procurement so they can start their business again.
• Loans: After Hurricane Matthew (2016), SFF made decisions on a case-by-case basis, sitting down with each of our 14,000 clients in the region to make these determinations. Some clients wanted to proceed with their existing loans; others wanted us to “top up” their existing loans with additional funds; and of course, other loans were dismissed without any repercussions for clients’ ability to borrow in the future. SFF will use this same case-by-case approach to address the needs of the clients by topping up loans, rescheduling or writing them off, based on the clients’ individual situation.
• Psychosocial support: Recognizing the extreme trauma our staff members and clients are experiencing, we are eager to identify opportunities to provide psychosocial support--perhaps through a partnership with experts and/or other organizations.
• Emergency staff fund: While our mission is first to support our clients, we cannot do so if our staff in the affected areas (numbering approximately 120 - 14 staff members for the Foundation) is overwhelmed by the situation.  We will therefore provide them each with a cash grant, a hygiene kit and psychological support to help them to recover as quickly as possible.
• Infrastructure repair and construction: We have already begun making repairs to branch offices and/or identifying alternative office space.

Long-term Recovery

We intend to start recovery efforts as soon as the local markets, the housing situation and the mental state of the affected populations allows it.  This could take 3 to 6 months.  We will then reach out to the microfinance clients who lost their livelihoods because of the earthquake and who have not been able to recover on their own.  We will offer them training, coaching and in-kind productive assets to restart their business activities.

Transparency and Accountability

Fonkoze is committed to transparent and accountable use of the funds that are generously entrusted to us. To date, Fonkoze has raised $608,760.

Audited financial statements from 2020 can be found on Fonkoze’s website here.

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