Evaluation of the FICOOP credit program

The existence of FICOOP has enabled cooperatives and their members throughout the Dominican Republic to obtain credit at favorable rates. For many who have received credit, FICOOP was the only possible source of funds. Via lines of credit with the Central Bank, FICOOP obtains funds at rates from 3.5% to 7.5%; member cooperatives and individual borrowers receive funds at slightly higher rates. These funds, as well as FICOOP"s capital and reserve funds, are made available to agriculture, livestock and poultry, mining and transportation, or other production-related services. Most loans have as their objective improving the nutrition of the Dominican people. Loan requests originate at the level of the final user; only well-founded projects are eligible. The Executive Director of FICOOP may approve loans of less than $15,000; this procedure expedites disbursements and thus production. Larger loans require FICOOP board approval. In 6/79, FICOOP signed an agreement with the Secretary of Agriculture (SEA) setting up a $250,000 revolving loan fund as part of the Program for the Small Farmer, which was established by an agreement between A.I.D. and the SEA under project 5170100. Under this agreement, FICOOP has processed 5 loans benefiting 284 small farmers, and totaling just under $100,000. As of 1/31/80, FICOOP loans totaled 4 million pesos; 4,000 families have benefited directly and 22,000 indirectly. Additional loans to cooperative federations for warehouse construction have the potential to benefit another 30,000 families. Continued growth in FICOOP lending can be expected as FICOOP enjoys considerable unused borrowing capacity within the Central Bank. Several recommendations are made regarding FICOOP"s lending and collection procedures.