We have had a continuous presence in Guatemala for 30 years, working alongside credit unions and national associations, more recently with FENACOAC. Through 11 consecutive projects and activities (CGAP, USAID, and credit unions), we helped to develop credit unions’ capacity, expand membership and services, develop and test demand-driven products in agriculture and remittances, create a deposit guarantee fund, and provide lobbying, legislation and regulation support. To date, FENACOAC has over 1,518,544 members from its 25 member credit unions and 266 branches throughout the country that are all united under the brand MICOOPE (my cooperative).
We also have a long history in the region, with current activities in Mexico and Colombia, and with over 20 years in Honduras and 16 years in El Salvador developing and building the capacity of credit unions. These programs focused on SME lending, agricultural finance, IT development, rural economic growth, credit union rating and certification, and remittances.
Most recently, under the USAID-funded Cooperative Development Program (CDP, 2010-2017), WOCCU developed and refined a set of agricultural finance tools to guide agricultural lending for credit unions in Guatemala and Mexico. We are now moving the tools to a mobile platform in Kenya under the second phase of the program. Through our support in Guatemala, FENACOAC, seven member cooperatives, and 26 producer groups and exporters led the development of the tools for agricultural lending. The group refined a set of 17 tools into a structured methodological process in order to 1) provide appropriate, affordable and high-quality financial services; and 2) provide specialized technical assistance to diversify production, increase productivity, create access to new markets, and improve household income. CDP introduced Good Agricultural Practices and Good Manufacturing Practices, provided technical assistance in greenhouses, and promoted the use of macro and micro tunnels, irrigation (drip, gravity), and seeding. Direct implementation in Guatemala ended in 2013, but FENACOAC continues to use the toolkit and methodologies learned from CDP.
The strategy in Guatemala led to a large increase in membership and significant impact in other areas: loans increased by $52 million, assets increased by $60 million, and, most dramatically, savings increased by $57 million. The agriculture loan portfolio was nearly nonexistent at the beginning of the project, accounting for only 4 percent of the total loan portfolio. Through development of the tools and refined policies and procedures, FENACOAC financed more than $34 million in agriculture loans to more than 13,000 members. The success of this project convinced FENACOAC to permanently house a rural finance division at its home office to expand the use of the toolbox to all cooperative members across Guatemala.
From 2005-2008, WOCCU partnered with FENACOAC and credit union affiliates to bring more unbanked remittance recipients into the financial sector and provide them with better opportunities to manage their money through the Integrating the Unbanked through Remittance-Linked Product Development program. The program developed a remittance-linked savings product that enables recipients to eventually have their remittance transfer deposited directly into an account; upgraded the remittance MIS web-based remittances platform to capture more information about recipients and senders; and designed a publicity campaign, “Cuéntales que” (“Tell them that”) to promote the new remittance-linked product and credit union benefits. Today, FENACOAC continues to offer remittance services under the brand MIREMESA, working with more than 225 agencies and more than 200 MICOOPE agents across the country.
Credit unions in Guatemala are working to establish credit worthiness for youth with little to no credit by creating small and flexible loan products. These products do not require a formal credit history and require fewer employment documents, and creates access to credit in scaled amounts by increasing loan amounts with successive repayment. Accessing credit through these simpler access products make young people more invested in a permanent asset accumulation relationship in their communities and less subject to irregular migration. And through our networking and education partnerships, WOCCU's Young Credit Union People (WYCUP) scholarship program has hosted 5 young credit union leaders from Guatemalan credit unions over the past 5 years.