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Poverty-Focused Housing Microfinance: Case Studies from Haiti, Rwanda and Vietnam SEEP Annual Conference October 26, 2006
Leverage HFH expertise in low-cost housing and MFI expertise in micro-finance management to achieve greater impact in housing worldwide. Increase access to improved housing with a wide range of affordability (vs. mortgage lending). Enable access to new sources of capital (loans, equity, etc.), thereby increasing overall investment in housing solutions. Increase HFH learning in effective loan fund management, building on microfinance best practice. HFH Objectives for Working with MFIs
Haiti: Latrines, Roofs, Floors (only products currently offered) Rwanda: Foundations, Walls, Roofs, Floors, Doors & Windows Vietnam: Tube Wells, Foundations & Floors, Toilets/Sanitation, Roofs, Walls Types of Projects Financed (in order of priority)
Haiti Fonkoze housing specialists directly hire laborers, purchase materials and oversee construction. Rwanda URWEGO housing specialists review project budget, provide basic construction advice, and monitor construction progress. Vietnam HFH staff provide training in project implementation, and direct construction assistance/advice to clients. Construction Assistance
Enables lower income populations to access housing microfinance. Group screening and pressure strengthen repayment performance of housing loans. Use of group structure to capture/monitor repayments reduces costs. Loan Officers divide origination and servicing roles. Group coordination of construction-related negotiations and building activities. Potential leveraging of savings-led groups (e.g. “Save and Build”). Benefits of Linking HMF to Existing Groups
Break-down in groups’ operations can negatively impact housing repayment performance. May limit the access to HMF for other legitimate sectors (e.g. low-income wage earners, remittance recipients). Limitation of Linking HMF to Existing Groups
Organizational Mainstreaming of HMF Develop product locally Link to institutional mission Determine loan officer roles and loads Integrate into branch structures and operational systems Determining costs and monitoring performance Price HMF products and services Analyze affordability Measure sustainability Key Issues Affecting Scale & Sustainability