Kiva Stories from the Field

As my fellowship continues to fly by, I’ve had many, many positive experiences, and really only one low point, which I’ll get to after reporting a little on my latest work. I’ve now been at FAPE for two weeks and it’s been fascinating to see the similarities and differences between the two organizations I’ve had the privilege of working with. FAPE is a much smaller organization than Friendship Bridge and FB has access to many more resources, as they are based out of Colorado and therefore have various sources of U.S. support. FAPE is a completely local organization, with a purely Guatemalan staff and board of directors. As a relatively small (less than 3,000 clients), local organization, FAPE has historically been quite limited in the loans that they can offer. Traditionally they have only offered group loans and in relatively small amounts (averaging about $250 per person). Over the years, they have acquired quite a few really good clients that have repeatedly demonstrated their ability to pay off their loans. As their businesses have grown (thanks in part to their loans as well as their entrepreneurial abilities and hard work), many of these clients have started to outgrow the small loans that FAPE has historically been able to offer. The organization clearly doesn’t want to lose these great clients, but their hands have been tied as they simply haven’t had the resources to offer larger loans. And then along comes Kiva. FAPE is now utilizing the partnership with Kiva to offer a new product: individual loans of up to $1,200. It’s been really great to interview the clients that have worked with FAPE for several years getting smaller group loans, and to hear how excited they are to now have access to more credit. While microfinance is clearly supposed to be, well, micro, these clients are taking what amounts to a relatively large sum of money to them to take larger steps in growing their businesses.

Between my time at Friendship Bridge and FAPE, I’ve interviewed over 80 clients to hear about how they’ve used their loans to invest in their business. Most of the time they’ve used the credit to buy more stuff to sell – more pigs or chickens, more inventory for their convenience store or their clothing sales, more thread and fabric for traditional weaving and embroidery. While all of these investments are clearly exactly what microfinance is about, in talking with the recipients of these relatively larger loans I’ve heard stories of even larger successes where these clients are strategizing to maximize the use of their money and investing in things with more long-term benefits. A few clients proudly reported that they had been able to pay off the last bit of the debt for their land, so now their earnings from their agricultural work are truly theirs. Other successes include paying off their market stall or being able to make a downpayment on a store of their own. As I interview these clients that have received substantially larger loans, a common theme is that they want even bigger loans. In general, they each have some sort of big purchase that they dream of, be it a truck to help them deliver their products to their customers, a house of their own for their often very large families, or a real store where they can sell their products in the formal sector, with the taste of a larger loan, they repeatedly ask for more. It definitely has me thinking about the delicate balance in microfinance, or lending in general, between the advantages of graduating to larger sums (such as discounts from buying in bulk, etc.) versus what is appropriate and responsible to give to people with few resources. While the clients clearly want more and can benefit from more, MFIs bear the tremendous responsibility of identifying what are reasonable amounts to lend to an individual. And that brings up another issue that Sergio, the director of FAPE, constantly mentions; that microfinance is not about credit reports and business records, it’s about the people. When FAPE looks into lending to a new person, they go out and meet with that person, see where they live, take a look at their business, or at least talk face-to-face about their business ideas. And when they decide to lend to an individual, it’s not really the business they are investing in, it’s the person. Overall it has been really interesting to hear this perspective and wonderful see FAPE making such good use of their partnership with Kiva to help their best clients even more.

On a completely different note, not all of my experiences have been positive. The vast majority have been amazing, but there was one low point recently and the worst part is not what happened to me, but the fact that this is a threat that so many people in this country have to deal with everyday. Last week I was on a bus, traveling with a FAPE loan officer from Guatemala City to the neighboring department of Chimaltenango, when five men with guns boarded the bus, shut the door, instructed the driver to keep driving, and proceeded to rob everyone on the bus. Overall it was as unbelievably harmless for me as such an experience can possibly be. I gave them the money I had in my pocket, which amounted to less than $2, and later they came back by and took my watch. As the lone token gringa on the bus I absolutely should have been their biggest target, so I sat and patiently waited for them to come by and take my backpack, with my camera and cell phone among other things, my wedding ring, and whatever else they might find valuable with close inspection of the foreigner. For some reason that is beyond human comprehension, that never happened. They really hardly paid any attention to me and after taking a few other people’s bags and many wallets and cell phones, they got off the bus and we continued on our trip. The loan officer I was with (Gloria) called FAPE to report the incident, and I immediately had several phone calls from a very concerned Sergio and other coworkers.

Incidences such as this are not uncommon in and around Guatemala City. I was well aware of that fact before I arrived, and I really had prepared myself mentally to be fine with handing over anything I have on me at any given time. So the robbery of my material possessions was really not all that traumatic. And other than the discomfort of seeing somewhat fake-looking guns being waved in the air and listening to general threats that they’d shoot somebody, I was subjected to no physical danger. The most disturbing part of the day was not the robbery itself, but all that I heard afterward. During the rest of the bus ride I heard story after story from other people on the bus, including Gloria, about all the robberies they had been subjected to; in their homes, their places of work, and on the road. And throughout the rest of the day as I headed to various interviews, Gloria mentioned the robbery to all we encountered and the reactions were all the same; everyone was so concerned that I had been subjected to this side of Guatemala and everyone had a similar story to tell.

So while it was unpleasant, in an odd sort of way I’m glad I had that experience. I’m here to experience the real Guatemala. I’ve had the privilege of getting dozens and dozens of small glimpses into the lives of some of the poorest of the poor in this country. And this incident, most unfortunately, really is a part of the lives these people lead. While I appreciate all the concern everyone expressed about how unfortunate it was that I had to experience that – me as a foreigner giving my time to help the people of Guatemala – what’s way more unfortunate is that this happens all the time to people who have so much less than I do and can so much less afford to have the little that they do have taken from them. I am so incredibly privileged to know that at any moment I could have any material possession I have taken from me and that I can replace it relatively easily. My only concern is my safety, which is certainly a valid concern for anyone in that situation, but really that’s it. However, 56% of Guatemalans live below the poverty line. That means that more than half the people in this country don’t have the minimum level of income needed to achieve an adequate standard of living. So to have any amount of money taken from them is so much more devastating, not just because it’s a scary experience, not just because they worry about their safety, but because they are often struggling to feed their families and keep a roof over their heads and having money and other possessions robbed from them really may result in missed meals for their children. So while I appreciate all the concern that I had to experience this, more than anything I am grateful to be that much more aware of the challenges people face in Guatemala and am reminded for what seems like the millionth time since I’ve been here of how lucky I am to have the life that I do.