Little boxes on the hillside,
Little boxes made of ticky tacky,
Little boxes on the hillside,
Little boxes all the same.
There’s a green one and a pink one
And a blue one and a yellow one,
And they’re all made out of ticky tacky
And they all look just the same.

In 1962 the folk artist Malvina Reynolds wrote this song to describe the suburban development she saw in the communities south of San Francisco. While the hills of San Francisco are about as far away from the hills of Bali, Indonesia as can be—both literally and metaphorically—these lyrics popped in to my head while driving my motorbike to visit Kiva borrowers last week.

Mitra Usaha Kecil Koperasi (Micro Enterprise Partners Cooperative) works in the seldom-visited rural regions of northwest Bali. There is little economic opportunity in this region outside of agriculture, so most families subsist off of the meager profits received from raising pigs or cows. The area is not densely populated—only a few houses scattered here and there on the windy country roads—but in front of nearly every house stands a small thatch kiosk selling candy, soda, snacks, soap, rice, etc.

During a drive down one particularly lonely stretch of road, I passed 6 houses, 5 of which had small kiosks that all sold essentially the same items. How any store owner can make a living when there are so few customers and so much competition is an absolute mystery to me.

From conversations with Kiva borrowers who manage such shops, I gather that these kiosks are not expected to generate tremendous profit. Owners simply lay their snacks on the table each day and if they happen to make a sale or two, so be it. This same situation exists around the globe (and has been commented on  by previous Kiva Fellows), particularly in rural regions where economic opportunities are limited. Whether it’s a series of kiosk owners in rural Bali, a series of tire-repair shops in Cambodia, or a series of Avon salespeople in rural America, the principal is the same–unfortunately, all the micro loans in the world can’t create opportunity where there is none.

So the question is: how do we develop new business models and incubate innovative ideas in regions with extremely limited opportunities? Is that the role of the individual entrepreneur or are there larger players that can/should be involved? What levers must be pulled by the government to spark change? In essence, how do we create business ecosystems that allow us to avoid an endless series of green, pink, blue and yellow ticky-tacky boxes?

by Nick Lewis, KF10 Indonesia

While you think of the solution, join the brand new lending team for Mitra Usaha Kecil.


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