Port au Prince, Haiti, May 19, 2014
— IFC, a member of the World Bank Group, is helping to promote a more inclusive financial system in Haiti to increase access to credit for micro, small and medium enterprises. In partnership with the UK Department for International Development, IFC is supporting the development of the Haitian leasing market and the modernization of its secured transaction system.
Close to half of Haiti's micro, small and medium enterprises have credit needs that are not being met by financial institutions, amounting to an estimated loan financing gap of more than US$2.5 billion. The lack of access to finance is one of the most significant constraints to the development of Haiti’s private sector.
Today, IFC, in collaboration with the Association of Professional Bankers of Haiti, is hosting a workshop for financial institutions and the government to share expertise on the legal and institutional frameworks that govern secured transactions and leasing.
Collateral provides the basis for free-flowing commercial and consumer credit by reducing potential losses lenders face from non-payment. While land and buildings are widely accepted as collateral for loans, the use of movable assets, such as inventory and equipment, is restricted in Haiti due to limitations in the existing legal framework and registries. The modernization of existing legal structures would facilitate the use of movable assets to guarantee loans and unleash leasing as a new mechanism through which micro and small businesses can access term financing to build thriving companies in key sectors such as construction, transportation, services, and agriculture.
In parallel, with support from the U.S. Agency for International Development, over the next two weeks, IFC and La Société Financière Haïtienne de Développement (Sofihdes) will sponsor training for up to 350 Haitian small and medium enterprises to deepen their knowledge of leasing. IFC has worked with partners in more than 58 countries to develop leasing companies and in more than 20 countries to help establish modern, web-based collateral registries to increase credit for small and medium enterprises.
“A modern secured transaction system and robust leasing market will help accelerate progress toward financial inclusion in Haiti,” said Ary Naïm, IFC’s Representative for Haiti and the Dominican Republic. “The objective is for the Haitian financial sector to be able to offer credit to SMEs that cannot provide real estate collateral, unleashing new opportunities for thousands of small entrepreneurs”
IFC’s portfolio in Haiti amounts to $67.9 million, including $24.4 million mobilized from other partners. We operate in sectors such as hospitality, energy, financial markets, and manufacturing. Through our advisory programs with the private sector and the government, we support access to finance, public-private partnerships, improvements to Haiti’s investment climate, and programs that make small and medium enterprises more productive. Our combined investment and advisory projects in Haiti have helped create 5,000 new jobs and safeguard an addition 5,000 existing jobs.
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in more than 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and promote shared prosperity. In FY13, our investments climbed to an all-time high of nearly $25 billion, leveraging the power of the private sector to create jobs and tackle the world’s most pressing development challenges. For more information, visit
www.ifc.org
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