John Keith Hatch

Dr. John Keith Hatch (born November 7, 1940) is an American economic development expert and a pioneer in modern day microfinance. He is the founder of FINCA International and the Rural Development Services (RDS), and is famous for innovating village banking, arguably the world’s most widely-imitated microfinance methodology.

Following his duty tour in Colombia he briefly served as an instructor in two Peace Corps training programs. Then, in early 1965 he was recruited as a regional Peace Corps director for Peru. Over the next 30 months he supervised some 55 volunteers working in agricultural cooperatives and credit unions serving the poorest. He returned home for graduate studies at the University of Wisconsin–Madison, obtaining an MA in Economic History (1970) and a PhD in Economic Development (1973). In between (1970–71) a Fulbright grant allowed him to spend two crop cycles as a hired labor to 30 peasant farmers in Peru, documenting the power and wisdom of their traditional farming practices. The experience taught him deep respect for the subsistence skills of the poor. For the next 12 years he worked as a consultant in the design, management, and evaluation of mostly agricultural projects seeking to benefit the poor, eventually completing over 55 assignments in 28 countries of Latin America, Africa, and Asia. Sadly, he found himself documenting dozens of foreign assistance failures that came closer to destroying than assisting their intended beneficiaries. He longed to create an organization that would allow the poor themselves-not bureaucrats, consultants, or other outsiders-to manage their own development initiatives.[1]

Founding FINCA

In 1984, Hatch finally created his own nonprofit agency-the Foundation for International Community Assistance (FINCA). He was inspired with the idea of FINCA while in an airplane high above the Andes, en route to a consultant assignment in Bolivia. He grabbed in-flight cocktail napkins, scraps of paper, and a pen and began writing down ideas, equations, and flow charts as fast as he could. By the time he landed in La Paz, he had the outline of a radically different approach to poverty alleviation: a financial services program that put the poor in charge. “Give poor communities the opportunity, and then get out of the way!” he said. The means to achieving this purpose were “village banks”, a self-managed support group of some 25 borrower-owners. Its purpose was to provide the poorest families, particularly those headed by single-mothers, with loans to finance self-employment activities capable of generating additional household income. The story of FINCA-which has been called a “World Bank for the Poor” and a “poverty vaccine for the planet”-is quite remarkable and even miraculous. FINCA currently operates village banking programs in 23 countries and since 1984 it has assisted over 1,000,000families, lending over $360 million (in 2007) to the world’s poorest families with a repayment rate of 98%, while also generating enough income to completely cover the operating costs of the field programs themselves. Moreover, there are now over 800 village banking programs worldwide in 60 countries created by about 30 other nonprofit agencies.

Retirement

In 2006, Hatch announced his retirement from day-to-day operations at FINCA headquarters in Washington, DC, although he continues to support FINCA in his capacity as a board member, fundraiser, and guest lecturer at universities. He currently lives with his wife Marguerite in Santa Fe, New Mexico, where he is pursuing a lifelong interest in watercoloring and screen writing. He is also co-founder of a new nonprofit—the Alliance of Students Against Poverty (ASAP)–which has a goal of ending global poverty by getting two million Americans to pledge “$1/day for those living on less than $1/day, thus raising $10 billion by the year 2025 to be distributed to those microfinance agencies with the best track record of serving the “poorest of the poor”. On June 26, 2009, Hatch will be presented with the Sargent Shriver Award for Distinguished Humanitarian Service by the National Peace Corps Association

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