Financial inclusion without discrimination

Entrepreneurial ecosystems
In the department of Valle, many people don't have access to financial education and are excluded from the formal banking system due to the lack of credit history. The Horus Association, created by people from the local LGBTI+ community, found a solution to facilitate access to credit for everyone and promote financial rights for all.

About 100 km from Tegicigalpa, the capital city of Honduras, is the department of Valle, known for its tropical climate, its port and fresh seafood. Its economic potential is founded on small and medium-sized companies (MSMEs) and the remittances that generally come from relatives living in the United States or Canada.

Here, as in the rest of the country, being able to get a loan is not easy. Limited access to financial education, the lack of collateral and credit history exclude many people from the formal banking system. This situation throws thousands of people to unemployment, making it impossible to become an entrepreneur, to invest in education or improve their living conditions.

In the department of Valle is the city of Nacaome, called "The Bride of the Sun" because of its warm and sunny climate. Here are the headquarters of the LGBT HORUS Association, created by people from the LGBTI+ community who have been working for years to eliminate discrimination and improve access to social, political and economic rights in a society that still has deep sexist biases and is considered very traditional. But Horus found a solution to facilitate access to credit for everyone.

Members of the LGBTI+ community and residents of the Department of El Valle who make up the Savings and Credit Fund “Caja de Ahorro y Crédito”, the so-called "The Bride of the Sun" in honour of this location.

Economic opportunities without discrimination

Because of the need of people who normally cannot get credit through the normal channels, Horus created the Savings and Credit Fund "The Bride of the Sun" (CAC for its Spanish acronym). This is an inclusive non-discriminatory financial institution that has made a big difference by facilitating accessible credit and savings opportunities without looking at people's sexual orientation, gender identity or expression.

According to Amnesty International, LGTBI+ people suffer discrimination based on their sexual orientation (who they are attracted to), their gender identity (how they define themselves as a person, regardless of their biological sex), their gender expression (how they express their gender when dressing or putting on make-up) or their sexual characteristics (for example, their reproductive organs or hormone levels).

Wesley Mejía, member of the board of directors of the Savings and Credit Fund CAC and coordinator of the Horus association.

“As a vulnerable population, the institutions are closed for us, the interest rates and criteria to qualify for loans are difficult. With the pandemic, the need for us to grow financially became even more important.”

Mónica Velásquez, transgender member of the supervisory board of the CAC and the Horus association.

"It is a big step forward for the Horus association, for me it means acceptance and an opportunity to show everyone that we are upright and capable of serving our community."

CAC savings and credit fund: a community model

The Savings and Credit Fund CAC was set up in 2019 with the help from the Foundation for Rural Business Development (FUNDER), within the framework agreement with the Rural Opportunities Project in the Gulf of Fonseca and was sponsored by Global Affairs Canada and implemented by Swisscontact. The pandemic, however, forced this process to be accelerated, moving from the pilot programme (which began in 2020) to expand the membership criteria to support both the LGBTI+ community and those who needed access to credit in the community.

“The CACs are community structures that arise from the need to have access to financing and savings in the communities themselves, where values such as trust, solidarity, responsibility and transparency predominate," says Gladys Ordóñez, financial services advisor for the project Rural Opportunities in the Gulf of Fonseca.

Treasurer of the CAC, during a fundraising event for savings and credit. 

Based on the potential of the territory and the socioeconomic characteristics of its associates, the savings and credit banks facilitate inclusion, creating products that adapt to the local conditions. They operate and are created with their own funds that come from the purchase of shares and savings of their members. Subsequently, they place that money through loans at accessible rates; the main guarantee is trust among their clients and members.

There are approximately 916 CAC Savings and Credit Funds in the Gulf of Fonseca region. The project Rural Opportunities in the Gulf of Fonseca provides technical, administrative and financial assistance to clients and partners of 100 CACs to strengthen their capacities.

Marleny Cárdenas, treasurer of the CAC “The Bride of the Sun” and resident of Nacaome.

“I am proud to belong to this organisation, grateful to them for having opened their doors to me and being able to participate in the project of financial inclusion without discrimination.”

Members of the CAC credit committee in the process of analysing credit profiles.

The success story of "The Bride of the Sun" extends beyond the Savings and Credit Fund, namely to the six people who have already received credits, some of which are members of the LGBTI+ community of Nacaome. This has allowed them to invest in small businesses, deciding case by case what the payment methodology should be for each client.

With the assistance given to the project, they are managing their legalisation process, their meetings and assemblies, purchasing shares and increasing savings. Currently, with a capital of L 12,000.00 (CHF 454.-) they continue to grow and create opportunities in this alternative financial system for financial inclusion without discrimination.

"We take out the credit to buy firewood and corn to make tortillas, we pay ourselves a simple fee, the idea is to pay off the loan and reinvest to make more tortillas,” Norma Canales and Henry Escobar, clients of the CAC and owners of the tortilla business.

Norma Canales and Henry Escobar, clients of the CAC and owners of the tortilla business, residents of El Valle.
Danya Castro, member of the Horus association, transgender member of "The Bride of the Sun".

"With the CAC we hope to grow and advance financially, to grow internally, without discriminating anyone."

Rural Market Opportunities in the Gulf of Fonseca is a project financed by Global Affairs Canada and implemented by Swisscontact. The project strives to strengthen the business opportunities of agricultural and non-agricultural micro, small and medium enterprises (MSMEs) to improve their ability to participate and make a profit in the markets.

The project also promotes gender equality and inclusion; in addition, it fosters an encouraging environment at the local level that contributes to the success and sustainability of businesses. One of its objectives is to strengthen economic awareness through implementing a financial education programme and strengthening numerical skills. The project aims to reach 7,460 clients directly and their households.