MICROCAPITAL BRIEF: Federación de Nacional de Cooperativas de Ahorro y Crédito (FENACOAC), World Council of Credit Unions (WOCCU) Support Microfinance in Guatemala, Mexico with $4m Rural Technology Cooperative Program

The World Council of Credit Unions (WOCCU), a US-based trade association for credit unions in 51 countries, and Federación de Nacional de Cooperativas de Ahorro y Crédito (FENACOAC), an association of credit unions and cooperatives in Guatemala, is using technology to assist rural farmers in Guatamala and Mexico in achieving financial stability. The WOCCU “Improving Small Rural Producers’ Income Through Integrated Access to Financial Services and Agricultural Markets” program is supported by USD 4 million in funding from the US Agency for International Development (USAID), an arm of the US Government [1]. The program focuses on developing agricultural and financial products to improve rural development. The program combines various methods of technological delivery of financial services to aid small farmers with products such as low-interest loans.

WOCCU and FENACOAC are implementing the program through four credit unions. One of these, Cooperativa Tonantel (Tonantel), has added agricultural lending to its product lineup and lowered its interest rates. Since the program began in 2010, membership has grown by 30 percent to 70,000 members [2]. Among Tonantel’s new mobile technology strategies is the provision of staff agronomists with laptop computers and mobile printers to offer financial services to farmers at their homes and on their farms. Tonantel is developing relationships with 18 member businesses in hopes of establishing agent banking outlets, which would offer enrollment, deposits and withdrawals, bill payment and other services [2]. The other three credit unions in the program have not been named.

USAID offers a suite of resources aimed at improving the outcomes of microenterprise development research and practice at http://microlinks.kdid.org.

By Courtney Snelling, Research Associate

About World Council of Credit Unions (WOCCU): Headquartered in the United States, WOCCU is a trade association and support agency for credit unions. WOCCU advocates before international organizations on behalf of 41 national-level credit union member trade groups operating in 51 countries, and it coordinates with national governments regarding legislation and regulation. Its technical assistance programs introduce tools and technologies intended to strengthen the financial performance of credit unions and increase their outreach. WOCCU consists of three entities: (1) WOCCU proper, (2) WOCCU Services Group, which functions as a for-profit corporation and (3) Worldwide Foundation for Credit Unions, which serves as a charitable organization. WOCCU reported total assets of USD 15.5 million in its 2010.

About the United States Agency for International Development (USAID): The United States Agency for International Development (USAID) is a government agency that provides international economic and humanitarian assistance. It focuses on areas such as economic growth, agriculture, trade, health, democracy, conflict prevention and humanitarian assistance. Under the Development Credit Authority (DCA), it provides credit guarantees that cover up to 50 percent of defaults on wholesale loans made by private financial institutions to institutions that lend on a retail basis to underserved borrowers. USAID had a total of USD 23.8 billion in budgetary resources in 2011.

About Federación de Nacional de Cooperativas de Ahorro y Crédito (FENACOAC): The Federacion Nacional de Cooperativas de Ahorro y Credito (FENACOAC) is an association of credit unions and cooperatives in Guatemala that was founded in 1963. It represents 27 member credit unions and aims to serve as a forum for information exchange and training.

About Cooperativa Tonantel: Cooperativa Tonantel, a credit union in Guatemala, is a member of Federación de Nacional de Cooperativas de Ahorro y Crédito (FENACOAC). Tonantel provides loans and savings products to its members. Financial information on the organization is not available.

Sources and Additional Resources:

[1] WOCCU.org, “Improve Rural Income, Cooperative Development Program” http://improveruralincome.woccu.org/cdp_overview

[2] WOCCU.org, “Rural Lending Supports Guatemala’s Economic Growth”, http://www.woccu.org/newsroom/releases/Rural_Lending_Supports_Guatemalas_Economic_Growth

MicroCapital.org Brief, August 23, 2011, “MICROCAPITAL BRIEF: World Council of Credit Unions’ (WOCCU’) “2010 Statistical Report” Announces 12% Increase in Credit Union Deposit Holdings, 10% Increase in Reserves” https://www.microcapital.org/microcapital-brief-world-council-of-credit-unions’-woccu’-“2010-statistical-report”-announces-12-increase-in-credit-union-deposit-holdings-10-increase-in-reserves

MicroCapital.org Brief, June 15, 2011, “MICROCAPITAL BRIEF: World Council of Credit Unions (WOCCU): Afghan Islamic Investment and Financial Cooperatives (IIFCs) Distributed Microfinance Loans Worth $7.4m in Last Third of 2010 https://www.microcapital.org/microcapital-brief-world-council-of-credit-u…

MicroCapital Universe Profile, WOCCU, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Wor…

MicroCapital Universe Profile, USAID, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Uni…

MicroCapital Universe Profile, Federación de Nacional de Cooperativas de Ahorro y Crédito (FENACOAC), https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Federacion+Nacional+de+Cooperativas+de+Ahorro+y+Credito+(FENACOAC)

MicroCapital Universe Profile, Cooperativa Tonantel, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Cooperativa+Tonantel

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