Law for the National Solidarity Credit Program for Rural Women

CREATION OF THE NATIONAL SOLIDARITY CREDIT PROGRAM FOR RURAL WOMEN. The National Solidarity Credit Program for Rural Women is hereby created, known as the CREDIMUJER Program, as an entrepreneurship program whose purpose is to promote the development of productive activities and services that contribute to the improvement of personal, family, and community living conditions. The CREDIMUJER Program functions under the budgetary and administrative authority of the Ministry of Economic Development, without this limiting the functions of other State Ministries or Public Institutions, within the framework of the activities developed by this entity to promote the development of micro, small, and medium enterprises.

PURPOSE. The Solidarity Credit Program for Rural Women (CREDIMUJER) is the State's technical-financial instrument to address the local demands of organized rural women through development projects, having as its principal instrument the facilitation of access to credit and technical assistance, under the following conditions:

• 1)

  That the Project to be developed demonstrates the existence of a Business Plan on which the credit is used for the acquisition of capital goods or working capital;

• 2)

  That the solidarity group demonstrates experience in the business activity it proposes to undertake; and,

• 3)

  That the applicant demonstrates the existence of the market where she will place her products. The CREDIMUJER Program can finance activities directed to micro, small, and medium agricultural production enterprises, agriculture, aquaculture, agropecuary, livestock, semi-culture, housing and fishing transformation, minor infrastructure, formal and informal commerce, and/or services, in accordance with the conditions and requirements established in the CREDIMUJER Program Operational Manual. The CREDIMUJER Program must focus its interventions throughout the country, giving priority to communities with the highest incidence of poverty and in areas with high agroecological vulnerability.

PROGRAM OBJECTIVE. The CREDIMUJER Program has the following objective:

• 1)

  To reduce vulnerability due to gender conditions and the weakness of economic and social participation processes of women;

• 2)

  To establish solidarity credit allocation programs for the development of agricultural and non-agricultural productive activities in amounts, guarantee conditions, low interest rates, repayment periods, and other conditions that facilitate access to credit and its optimal use;

• 3)

  To establish technical assistance programs in the formation of Basic Production Units (UPB), in business services, access to new technologies, market access, and any other assistance that increases the value chain, quality, and creditworthiness and business management capacity of women;

• 4)

  To establish a network of support and research to strengthen entrepreneurial culture and innovation to diversify productive activities and open new market opportunities;

• 5)

  To establish coordination mechanisms with other State Ministries that perform functions related to the purpose of this Law so that they support the development of the CREDIMUJER Program, particularly the State Ministries of Agriculture and Livestock, Development and Social Inclusion; the Honduran Professional Training Institute (INFOP), the National Institute of Women (INAM), the Honduran Tourism Institute (IHT), National Agrarian Institute (INA), National Bank for Agricultural Development (BANADESA), and State universities and schools in the fields of agriculture and business, through financial, training, and technological support programs;

• 6)

  To establish agreements with Non-Governmental Organizations and private entities in relation to support programs or through Corporate Social Responsibility programs they develop;

• 7)

  To enable new modalities for access to financial and non-financial resources that allow for increased rural production, employment, and income for women in rural communities; and,

• 8)

  To fulfill the commitments assumed by the State of Honduras in International Treaties and Conventions referring to women's rights. CHAPTER II FUNCTIONAL FRAMEWORK

CREDIMUJER FUND. To finance the activities of the Program, the Solidarity Credit Fund for Rural Women (CREDIMUJER) is hereby created, which must be administered through a Trust established by the Ministry of Finance at the Honduran Bank for Production and Housing (BANHPROVI), in accordance with the provisions determined in this Law.

ASSETS. The assets of the Trust are constituted by:

• 1)

  Ordinary and special contributions from the State that are included in the General Budget of Income and Expenses of the Republic;

• 2)

  Contributions and donations from national organisms and international cooperating agencies;

• 3)

  Subsidies and relief funds that contribute to reducing the cost of resources that must be placed as credit to the beneficiaries of the CREDIMUJER Program;

• 4)

  Loans contracted by the Trustee Agent with national and international financial institutions to strengthen the activities of the CREDIMUJER Program;

• 5)

  Other transfers, legacies, and donations from natural or legal persons;

• 6)

  Collection for services provided by the CREDIMUJER Program, as determined by this Law; and,

• 7)

  The product of patrimonial income and other revenues.

TRUST OPERATION. Investment plans must be authorized annually by the Ministry of Economic Development with the opinion of the Advisory Council of the Solidarity Credit Program for Rural Women (CREDIMUJER). The Trust's resources can only be used in credit operations and therefore cannot cover operating expenses and technical assistance costs of any public entity.

TRUST FUNCTIONING. The Trust must function under the following scheme:

• 1)

  The trustee institution that must act as a Second-Floor Bank;

• 2)

  A network of financial institutions, credit cooperatives, rural savings and loan associations, and other qualified financial institutions that must function as agents for placing the credit resources of the CREDIMUJER Program;

• 3)

  The network of risk-placing institutions must be qualified by the financial institution and in turn to the institutions that comprise the network, among those that have credit experience for MSMEs and present conditions of capacity, experience, prudence, and responsibility in the handling of these operations;

• 4)

  Credit risk must be assumed by the network of resource placement or by the agent that in turn will place the credit with the final borrower;

• 5)

  The trust contract must determine the placement modalities whether through advances, credits, advances and rediscounts of credit instruments, which shall be applied in the relationship between the second-floor institution and the credit placement network; and,

• 6)

  The other conditions of the fiduciary mandate must be included in the trust constitution contract, including those relating to the determination of the financing plan and other administration and reporting formalities for advances, the results of the trust's activities, and the term of the trust itself.

THE CREDIT REGULATIONS. Once the Trust is established, the Credit Regulations shall be prepared by which credit placement operations shall be governed in solidarity credit operations, financial leasing, and other guarantee modalities among the beneficiaries of the Solidarity Credit Program for Rural Women (CREDIMUJER). These Regulations must be prepared within ninety (90) days jointly by the trustee institution and the State Ministries of Economic Development and Finance, as those responsible for managing the Solidarity Credit Program for Rural Women (CREDIMUJER) and shall form part of the Trust documentation. In addition to the stipulations indicated in Article 2 of this Law, the CREDIMUJER Program Plan and Credit Regulations must be based on the experience of handling microcredit for the development of enterprises and self-employment activities that have demonstrated successful experiences at national and international levels. Credit operations can only be carried out with groups or producer associations under the solidarity program modality.

TECHNICAL ASSISTANCE PROGRAM. The Ministry of Economic Development, through the executing unit it designates as mandated by this Law, in coordination with other public entities, non-governmental organizations, and private entities as determined in numerals 3), 5), and 6) of Article 3 of this Law, must establish the Annual Technical Assistance Program for women entrepreneurs included in the CREDIMUJER Program to develop capacities, appropriation of new technologies, productive innovation, small business and enterprise administration, formation of business chains, market location and financing for producers; in any case, technical assistance must be defined based on successful experiences in the management of this type of business. The Ministry of Economic Development must issue the CREDIMUJER Program Technical Assistance Regulations determining the mechanisms for carrying out technical training, without prejudice to the supervisory actions of the resource-placing entities and operates an effective dissemination system on the activities of the CREDIMUJER Program.

PUBLICATION OF REPORTS. The reports presented by the trustee institution must be published annually in order to make transparent the accountability in the activities of the trust.

ADVISORY COUNCIL OF THE CREDIMUJER PROGRAM. For purposes of consultation, advisory, monitoring, and social audit, the Advisory Council of the Solidarity Credit Program for Rural Women (CREDIMUJER) is hereby constituted with the following composition:

• 1)

  A representative at the ministerial level of the Ministry of Economic Development, who must coordinate it;

• 2)

  A representative at the ministerial level of the Ministry of Agriculture and Livestock;

• 3)

  A representative at the ministerial level of the Ministry of Development and Social Inclusion;

• 4)

  A representative at the ministerial level of the Ministry of Finance;

• 5)

  A representative at the executive level of the National Institute of Women (INAM);

• 6)

  A representative of Via Campesina;

• 7)

  A representative of the Agricultural Platform;

• 8)

  A representative of rural women networks;

• 9)

  A representative of indigenous women's organizations; and,

• 10)

  A representative of Afro-descendant organizations. The representatives of women farmers' organizations must be elected for a period of two (2) years and may be reelected for one additional period. The accreditation of the representatives thereof must be verified by the Ministry of Economic Development.

FUNCTIONS OF THE ADVISORY COUNCIL. The Advisory Council of the Solidarity Credit Program for Rural Women (CREDIMUJER) has the following functions:

• 1)

  To present recommendations on policies that should be considered for strengthening the CREDIMUJER Program;

• 2)

  To issue opinions on policy documents, regulations, operational manual, as well as the strategies and credit activities planned to be implemented;

• 3)

  To conduct social audit activities on the activities of the CREDIMUJER Program;

• 4)

  To report to the competent authorities any irregularities presented by those responsible for implementation and the beneficiaries of the CREDIMUJER Program;

• 5)

  To disseminate and promote among beneficiary associations the available credit programs;

• 6)

  To propose to the entity responsible for administering the CREDIMUJER Program, needs relating to groups requiring new financing and to issue opinions on the Annual Investment Plan of the Trust;

• 7)

  To develop participatory processes that strengthen the capacity of rural women's organizations in identifying and prioritizing their needs to express their demands for technical assistance and financing, as well as to define management and negotiation actions for their economic activities; and,

• 8)

  To promote new sources of resources that financially support the Fiduciary Solidarity Credit Fund for Rural Women (CREDIMUJER). The Advisory Council must meet ordinarily at least two (2) times per year and extraordinarily when convened by the Secretary of State for Economic Development or by three (3) or more of its members. Its performance is ad honorem and for the purposes of its functioning it must be financially supported by the Ministry of Economic Development.

STATE CONTROLLING ACTION. The State Controlling Bodies must exercise their supervisory function over the CREDIMUJER Program in their respective scope of competence and ensure compliance with the obligations corresponding to those responsible for administering the resources of the Program (CREDIMUJER), who must observe the requirements of administrative transparency required by the corresponding laws. Notwithstanding what is established in the preceding paragraph and for the purpose of guaranteeing proper management of the CREDIMUJER Program and when circumstances warrant it, the Honduran Bank for Production and Housing (BANHPROVI) as responsible for administering the CREDIMUJER Program may contract consulting services and Project evaluation services.

COMPLEMENTARY SUPPORT. The Ministry of Finance, through the General Direction of Public Investment (DIGIP), must participate in the development of support and monitoring actions for the activities of the CREDIMUJER Program. The contracting of qualified companies to conduct evaluations must be done through competitive bidding.

COMPLEMENTARY FINANCIAL MANAGEMENT. The Program (CREDIMUJER) must manage resources and new institutional sources that financially support the Fiduciary Fund of the CREDIMUJER Program, including the use of any financial support program promoted by the Executive Branch for the reactivation of the agricultural, agroindustrial, and agroalimentary productive sector.

To strengthen the institutional capacity of the CREDIMUJER Program in aspects related to technical assistance, training of human resources, supervision, monitoring, evaluation and audit of rural development processes, the State Department of Agriculture and Livestock and the National Program for Sustainable Rural Development must provide personnel with experience in each of the relevant areas, in accordance with the needs of rural women. Additionally, non-reimbursable technical cooperation may be sought with cooperation organizations and/or friendly governments for the institutional strengthening of the CREDIMUJER Program, in order to efficiently fulfill its functions. CHAPTER III FINAL AND TRANSITORY PROVISIONS

Within ninety (90) days from the date this Law enters into force, in compliance with the provisions of Article 1 thereof, the Executive Branch through the State Department of the Office of Economic Development must assign in an executing unit within its existing organization for support to micro, small and medium enterprises, the functions corresponding to the administration of the CREDIMUJER Program. Within this same period, there must likewise be established through an initial contribution by internal transfer of not less than FIVE MILLION LEMPIRAS (L. 5,000,000.00) to initiate the Trust Fund for Solidarity Credit for Rural Women (CREDIMUJER) referred to in Article 4 of this Law.

The Executive Branch, through the State Department of the Office of Economic Development and with the support of the State Departments of the Offices of Social Development and Inclusion and of Agriculture and Livestock, within a period of ninety (90) days, shall issue the Regulations relating to this Law.

The State Department of the Office of Finance is authorized, in coordination with the State Department of the Office of Economic Development, to allocate in the Revenue and Expenditure Budgets of the Republic corresponding and in a progressive manner, the budgetary items for the ordinary and special contributions of the State to the Trust Fund of the CREDIMUJER Program, ensuring that in the absence thereof, the Solidarity Credit Program for Rural Women (CREDIMUJER) may begin its operations with resources from external cooperation, from loan contracting or with any other of the elements that make up the assets of said trust fund, including the transfer or simultaneous management of other State credit support programs.

For purposes of this Law, economic initiative is understood as that of a personal or collective nature that has as its purpose the production of goods and services, without any requirement regarding the number of employees and capital size, even in its basic expression.

This Decree shall enter into force as of the day of its publication in the Official Journal La Gaceta. Given in the city of Tegucigalpa, municipality of the Central District, in the Hall of Sessions of the National Congress, on the first of October of two thousand fifteen. ANTONIO CESAR RIVERA CALLEJAS PRESIDENT JOSE TOMAS ZAMBRANO MOLINA SECRETARY SARA ISMELA MEDINA GALO SECRETARY To the Executive Branch. Therefore: Execute. Tegucigalpa, M.D.C., November 24, 2015. JUAN ORLANDO HERNÁNDEZ ALVARADO PRESIDENT OF THE REPUBLIC THE STATE SECRETARY IN THE OFFICE OF ECONOMIC DEVELOPMENT ALDEN RIVERA MONTES