Project assistance completion report : rural housing improvement project (522-0171)

Results were impressive. With INVA authorizing just over $5 million through signed agreements with 19 intermediaries, the project provided a source of credit for 16,196 rural families in areas that had previously been neglected by the Honduran government. As most of these families were dependent on agriculture, loan delinquencies varied with the success or failure of the harvest. At the end of the project, the range of delinquent loans to the PVO"s averaged 22%, comparing favorably with similar programs in urban areas in Honduras. The most active PVO, Caritas de Danli, issued 3,983 loans resulting in 6,614 rural home improvements. When the project concluded, this PVO had dispersed $946,000 and recovered $759,800. In light of project performance, INVA secured additional funding from the Honduran Ministry of Finance for a second phase of the project. Three lessons have been learned. (1) The project goal of making INVA financially self-sufficient by 1990 is not likely to be achvieved. The design of programs in which self-sufficiency is a goal must be sensitive to macroeconomic factors in the host country that may impede this goal. (2) The design of projects involving new activities should allow more start-up time than of projects involving activities in which the implementing agencies are already experienced. (3) Projects implemented by PVO"s should include sufficient TA from the outset to upgrade PVO accounting procedures to A.I.D. standards.