CARE Village Banks Project, Guatemala

The Women’s Village Banking (VB) Program of CARE Guatemala provides particularly interesting insights into some of the issues and challenges facing village banking programs around the world. Like many programs started in the 1980's, the CARE VB program was created as an experiment in the increasingly popular field of microenterprise finance. It modeled the FINCA VB approach and gradually adapted itself to the Guatemalan context. After seven years of operation, the program has reached a crossroad in its evolution as several major decisions related to its future mission and role must be made. While numerous lessons can be learned from the experience of the VB program of CARE Guatemala,1 the following focuses on three unresolved strategic issues that will affect the direction of the program in the future. First, will CARE Guatemala break from its corporate culture of subsidized humanitarian aid in favor of a more business-like approach to sustainable banking?Secondly, will village banks be encouraged to "graduate" from the program? Thirdly, how will the recent client interest in savings mobilization be incorporated into the program in a safe and sustainable manner? [author]