Last Updated June 21, 2012

Partner Description:

The Foundation for the Development of Southern Communities (FUDECOSUR) is a non-profit microfinance institution established in 1993 to promote development in the poorest regions of Southern Costa Rica. FUDECOSUR operates in 165 communities located in the cantons of Pérez Zeledón, Buenos Aires, and Coto Brus. As a non-profit, it funnels all income earned from interest payments back into local communities to expand credit opportunities and fund non-financial services like computer education.

The main source of income for FUDECOSUR’s clients is small-scale farming, supplemented in many cases by part-time work for large plantations in the area. To serve the unique needs of the agricultural market -- which runs on the ups and downs of the harvest cycle -- credit is often extended for longer loan terms, with principle payments made once yearly.

FUDECOSUR utilizes the village banking model to facilitate lending and education. This model empowers the communities where FUDECOSUR works by training village residents to run village banks, also known as credit committees.

With dedicated mentoring and guidance from loan officers, FUDECOSUR’s village banks are run by five to seven dedicated volunteers, who are elected every two years by members of their community. Partnering with FUDECOSUR’s loan officers, credit committees are responsible for assessing and approving loan requests, disbursing loans to borrowers, collecting loan payments, documenting all credit requests and exchanges, and monitoring borrower progress. Credit committees are also charged with educating their community members on FUDECOSUR rules and requirements for soliciting, receiving and repaying loans.

These village banks are comprised of a locally-elected president, vice-president, treasurer, secretary, compliance officer and up to two additional representatives who meet twice monthly to receive payments and distribute credit to their local communities. Loan officers from the FUDECOSUR central office visit each village bank once a month to review procedures and approve new loans. A board of directors comprised of elected borrowers oversees this community credit provision and meets at the central office monthly.

Notably, 31% of these elected positions and 35% of loan funds are earmarked for female participants, helping to empower the women living and working in these communities. The village banking model helps mitigate risk by utilizing the intimate knowledge that these communities possess about market conditions on the ground. It also creates a bond of trust in these farming communities between the organization and its clients, ensuring that decision-making starts at the community level. Finally, the ability to obtain loans without having to leave the community helps keep costs down and ensures a low cost of debt for the communities FUDECOSUR serves.

In addition to credit, FUDECOSUR borrowers benefit from free community and business development courses funded by the institution. Free technical training and education courses are provided to increase crop and cattle yields, improve community health and sanitation, and expand alternative job opportunities. Course themes are requested by the village banks, and are coordinated by the FUDECOSUR director and loan officers. They find experts in each field of training, including technical college agronomists for crop cultivation or livestock care courses, and information technology professionals for computer training courses. Village bank communities have benefitted from detailed courses combining theory and practice. Examples include:

 Livestock Health Care and Output Optimization
 Coffee Cultivation and Output Optimization
 Hydroponic Farming Capacitation (to optimize more environmentally-friendly, pesticide-free, fungicide-free, and disease-free farming)
 Food Handling and Sanitation (to improve community health and support start-up food service businesses)
 Computer Training (Microsoft Office for children and adults)
 Sewing/Clothes Making
 Community Recycling
 Water Purification

To support additional village banks for new clients in need, FUDECOSUR opened a second office in San Vito in April 2011. The institution currently operates 45 village banks.


To learn more about FUDECOSUR and its borrowers, see the following resources:



- Kiva Fellow Blog posts:
Bank-O-Mat Under a Hot Tin Roof: Making Non-Profit Microfinance Sustainable
Village Banks BY Farmers FOR Farmers: A Microcredit Labor of Love

Or visit fudecosur.org for more information.

September 11, 2011

As part of an ongoing effort to fully migrate risk ratings to our new and enhanced risk rating system, Kiva has conducted a re-assessment of the level of risk posed by this institution.

During this re-assessment, our analysts were able to gather updated operational and financial information about the institution, as well as speak with key members of the staff.


Kiva's new risk rating system, which now includes half stars, has enabled us to display FUDECOSUR's risk rating with a higher level of granularity. As a result, FUDECOSUR's risk rating will now be displayed as 2.5 stars instead of 3 stars.

We have prepared a blog post with more information on Kiva's new and enhanced risk rating system, along with a chart showing the relative magnitude of the overall changes for Kiva's portfolio.  To view that, please go here.

FUDECOSUR has been informed of the change in the display of their rating on Kiva's website.

Repayment Performance on Kiva

    This Field Partner All Kiva Partners
  Start Date On Kiva Oct 8, 2009 Oct 12, 2005
Total Loans $1,207,375 $590,831,750
Amount of raised Inactive loans $0 $819,825
Number of raised Inactive loans 0 696
Amount of Paying Back Loans $507,075 $116,310,325
Number of Paying Back Loans 642 123,737
Amount of Ended Loans $700,300 $473,701,600
Number of Ended Loans 876 601,061
Delinquency Rate 6.87% 4.21%
Amount in Arrears $25,224 $3,160,641
Outstanding Portfolio $367,265 $75,153,836
Number of loanDelinquent 125 14,150
Default Rate 0.24% 1.13%
Amount of Ended Loans Defaulted $1,686 $5,347,284
Amount of Ended Loans $700,300 $473,701,600
Number of Ended Loans Defaulted 3 16,817
Currency Exchange Loss Rate 0.02% 0.09%
Amount of Currency Exchange Loss $290 $536,853
Refund Rate 0.69% 0.77%
Amount of Refunded Loans $8,275 $4,537,625
Number of Refunded Loans 8 5,064

Loan Characteristics On Kiva

    This Field Partner All Kiva Partners
  Loans to Women Borrowers 30.35% 74.18%
Average Loan Size $797 $418
Average Individual Loan Size $797 $655
Average Group Loan Size $0 $1,828
Average number of borrowers per group 0 8
Average GDP per capita (PPP) in local country $11,100 $3,430
Average Loan Size / GDP per capita (PPP) 7.18% 12.20%
Average Time to Fund a Loan 6.43 days 5.6 days
Average Dollars Raised Per Day Per Loan $123.86 $74.74
  Average Loan Term 30.33 months 10.35 months

Journaling Performance on Kiva

    This Field Partner All Kiva Partners
  Total Journals 607 295,934
  Journaling Rate 77.02% 42.37%
  Average Number of Comments Per Journal 0.02 0.08
  Average Number of Recommendations Per Journal 0.04 1.87

Borrowing Cost Comparison (based on 2012 data)

    This Field Partner Median for MFI's in Country All Kiva Partners
  Average Cost to Borrower 28% PY 23.00% PY 33.27% PY
  Profitability (return on assets) 2.7% 0.5% -1.45%
  Average Loan Size (% of per capita income) 14.30% 28.00% 40.88%

Country Fast Facts

Field Partner Staff

David Avalos Vega
Leonardo Azofeifa Lopez
Crisia Badilla Duran
Melissa Barahona Madrigal
Gerardo Barrantes Calderon
Diogenes Garcia Hidalgo
Heiner Gonzalez Marin
David Hidalgo Fonseca
Silvia Villalobos Ceciliano
Wendy Viquez Bonilla
Danny Zuñiga Rodriguez