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Haiti - Economy : Household debt rose
15/04/2011 10:23:02

Haitian households, whatever their class, have mostly used loans to meet their economic needs. This is the result of an investigation between October 2010 and March 2011, conducted by the Agency for Technical Cooperation and Development (ACTED), on the economic situation and household debt in Port-au-Prince and Leogane.

This study shows that the use of loans increased in Port-au-Prince, after the earthquake of January 2010, while borrowing practices have slightly decreased in Leogane because of a lack of refinancing options available for usual creditors such as moneylenders, individuals and Micro Finance Institutions (MFIs). Representing 17% of loans before the earthquake, MFIs have experienced difficulties after the earthquake, which resulted in a decrease in the volume of microcredit available.

Several factors explain the use of the loan:
1 - Pay the school fees;
2 - Financing economic activities due to the non-viability of small businesses
3 - Buy food, especially in Leogane.

The categories of respondents, using debt as a form of "safety net". However, from a productive tool, the loans have become survival strategies or a way to maintain social and economic status of households.

PI/ HaitiLibre