AID cooperative agreement no. PDC-0158-A-00-1105-00 with the Foundation for International Community Assistance (FINCA) for a program entitled `business development promotion/PEBD"

In Costa Rica, FINCA will capitalize eight women-focused village banks and train village bank committees. Loans will fall into two types: (1) poverty loans of $50-$300 for 200 women, and (2) 170 microenterprise loans of $500-$1,500 for men and women who are already village bank members and in need of larger and longer loans. Efforts will include establishment of an open-ended line of credit with a formal sector financial institution. All banks will be 100% self-financing by the end of year 3. FINCA will seek to determine the relative cost-effectiveness and economic impact of poverty lending and microenterprise lending. Activities in Guatemala, Haiti, and Honduras will be similar, except that no gender-specific poverty loans are planned. FINCA will organize 40 village banks in each country, train bank committees and members, and promote savings mobilization and microenterprise lending. As in Costa Rica, 1170 microenterprise loans are targeted for each country, and all banks will be 100% self-sufficient by the end of the grant period. In each of these three countries, FINCA will introduce a computerized accounting and management information system for its staff, and hire one accountant and one promoter for every ten banks, FINCA will also establish participatory evaluation systems in all four project countries, build in-country FINCA networks for assisting village bank programs, and add personnel needed to strengthen its own ability to perform these tasks.