By Jane Lim, KF9 Mongolia

Today my envy of other Kiva fellows faded because I finally, finally got to meet Kiva borrowers.

There is a certain sadness that most of these borrowers have. For some it’s buried deep beneath stoicism and the victories of subsequent success, but for others it’s brimming at the surface, and you get the feeling that one more slight push would send them into the chasm. When I take their photos, they never smile – and I’ve thought of asking them to, but I don’t want to if there’s nothing to smile about. The truth is, life has been hard for them.

where i went today: the Chingeltey ger district

Kiva lenders may think they are doing a great thing (and they are doing a good thing of course), but these borrowers don’t get the benefit of the 0% interest rate, and to them, they aren’t being done any favors – because who knows what they had to get through to make those repayments back in full and on time, with interest added. They certainly don’t owe anyone anything, and because of that, when I intrude in their lives with a video and a huge camera, I feel somewhat ashamed.

But it’s not all grey of course. So many in the microfinance industry are in it because they hope, as do I. And the borrowers I meet, they do laugh, but don’t necessarily dream. The reality is that for many, loans are required for survival or working capital, not necessarily to step up or make a significant game-changing investment. Consequently, default rates in the microfinance world are lower than those in the mainstream commercial world, because these borrowers need to repay to get the next loan, and the next, and the next. And perhaps that’s why some of them are willing to go on video, get their photographs taken, answer questions… even though they might not necessarily want to – because they don’t want to risk losing their line of credit.

I realize this post sounds a bit morose, only because one particular borrower made such a strong impression on me. Soft-spoken, it isn’t in her nature to fight. But she has to, because she has two young sons to feed – a little red-faced baby was sleeping soundly on the single bed she has, and her other son, no more than 6, was watching a dubbed version of LOTR while doing homework. The downfall of socialism 20 years ago meant the closure of a lot of government-run factories, and she lost her job. So now she sits in her dimly lit ger, sewing grey gloves, hoping to find a mass buyer.

Hers is the sadness that threatens to overflow.

by Jane Lim, KF9 Mongolia

notable quotes from recent reads…

“Ulaanbaatar is possibly the coldest capital city in the world.“
- Michael Kohn, Lonely Planet Mongolia, p14

as a testament to the point above, it snowed on wednesday for the first time since summer… and it’s only early october.

“The Mongols loved competitions of all sorts, and they organized debates among rival religions the same way they organized wrestling matches… Their debate ranged back and forth… No side seemed to convince the other of anything. Finally, as the effects of the alcohol became stronger, the Christians gave up trying to persuade anyone with logical arguments, and resorted to singing. The Muslims, who did not sing, responded by loudly reciting the Koran in an effort to drown out the Christians, and the Buddhists retreated into silent meditation. At the end of the debate, unable to convert or kill one another, they concluded the way most Mongol celebrations concluded, with everyone simply too drunk to continue.”
– Jack Weatherford, Genghis Khan and the Making of the Modern World, p172-173

absolutely hilarious stuff.

“Mongolians are lazy and (insert negative adjective that i’ve forgotten). Would you describe yourself as so?“
- Mongolian Airlines In-flight Magazine, Interview question for J. O- a prominent Mongolian businesswoman

WOW. all I can safely say is that Mongolians are extremely candid. (i still can’t believe they published that and made it accessible to an international audience!)

lastly,

“Why have economists remained silent while banks rejected the poor as unworthy of credit? Nobody can provide a convincing answer. Because of this silence and indifference, banks have imposed a financial apartheid and gotten away with it. If economists would only recognize the powerful socioeconomic implications of credit, they might recognize the need to promote credit as a human right.”
- Muhammad Yunus, Banker to the Poor, p150

go kiva.

by Jane Lim, KF9, Mongolia

here’s where i’m at:

i wanted to write a before and after just so you can hear my drawn breath of anticipation / trepidation in between…

before: 9:30am EST on Friday, Oct 9th
i realize no one knows a lot about Mongolia… therefore i can make up absolutely anything and people will believe me. haha

case in point. (some of the following are actually true)

1. there is a mongolian mythical creature called the Mongolian Death Worm which is purportedly found in the Gobi Desert, grows up to 5 ft long, and spews sulfuric acid which makes it deadly to men
2. Genghis Khan’s father wasn’t his mother’s first husband
3. mongolians historically have been nomads, and hence do not farm; therefore amongst many other things their vegetables are made-in-china
4. there is another mongolian mythical creature in the Kharyagas lake which is roughly equivalent to the Loch Ness Monster in Scotland
5. there is a Louis Vuitton store in the capital
6. there still exists barter trade in Mongolia. I am for instance, trying to use xx units of xxx as currency. (am not revealing exactly what because i don’t want it to devalue. j/k)

turning to more mundane matters, in the next 35 hours starting at 4:30pm EST i will take 3 flights, have 2 layovers, be in 4 airports (Boston>LA>Seoul>Mongolia), before arriving in Ulaanbataar.

hopefully it’ll go like clockwork.

after: roughly 3pm on Sunday, October 11th (Mongolian time is exactly 12 hours ahead of EST)

Landing in Ulaanbaatar, Mongolia

time to be a Kiva fellow.

Tamara Sanderson, KF8, Mongolia

Once upon a time, two NGOs named “the Golden Fund for Development” and “Gobi Start” came together to form their own commercial bank with a social mission.  They decided to name themselves “the right bank,” with the hope that Mongolians could repay.  Although all odds were against this new bank, it prospered at a time of economic uncertainty in Mongolia after the collapse of the Socialist system and overarching bankruptcy in the financial sector.  Eight years later, this initiative has resulted in the largest microfinance bank in Mongolia and a role model for other MFIs (microfinance institutions) throughout the world.  

When I first heard this story about XacBank, it seemed a bit like a fairy tale.  Based on analysis from the MicroBanking Bulletin (MBB), it takes about 7 years, on average, for an MFI to become financially sustainable.  Sustainable means that the MFI collects its loans and covers all its costs well enough to serve poor clients even after it does not get grants or soft loans from donors or government. 

 XacBank broke this norm.  It was profitable from the very start.

Although this is great for XacBank, it logically leads to another question.  If it is financially self-sufficient, why does it need Kiva?  Shouldn’t the 0% interest capital go to other MFIs that need it more?

I asked these questions to Jenny, a microfinance partnerships manager at Kiva, and she responded with the following reasons for partnering with XacBank:

1. Portfolio balance: Kiva likes to work with a diverse set of microfinance organizations to minimize risk
2. Reputation: XacBank has an incredible reputation in the microfinance space and can use the Kiva funding in innovative ways, rather than just keeping the organization a float
3. Scale: Larger MFIs allow Kiva to scale its operations faster and typically have the resources to provide better borrower profiles and journals

Now, Jenny’s explanation made sense, but I was wondering if I would see XacBank using the 0% interest capital to directly benefit the borrowers.  As I reflect on my Kiva Fellowship, I can see several unique benefits of the XacBank – Kiva partnership.

• At the end of the Kiva loan, non-delinquent borrowers will be given back 9% of the interest he or she paid. The repaid interest will be placed in a XacBank savings account, giving the borrower an additional financial tool.  Lenders can see the tangible benefit of their Kiva loan on the borrower
• XacBank has the resources to publicize Kiva in Mongolia.  I’ve never been on TV in the United States, but in the last two months, I was interviewed on the Mongolian National Radio, gave a speech at a Kiva publicity event, gave a brief on Kiva for the half year report and was featured on the main news station in Mongolia.  Maggie, the XacBank Kiva Coordinator, gets calls every day from people wanting Kiva loans!
• The stories from the XacBank borrowers illustrate the power of microfinance over time.  I have interviewed dozens of borrowers, and I kept hearing stories like:
  • “I have no relatives, but I think of XacBank and its loan officers as my brothers and sisters.  When I first became a XacBank client, I had an old soldier’s bed and nothing else.  Due to the loans, my personal life has changed drastically.  XacBank saved my life, and I am now on my 11^th loan” – Purevsuren Altangerel
  • “XacBank loans have provided my family’s life.” – Dulmaa Samdan
  • “Without XacBank loans, I could not run my welding business.  Loans are very important to me.” – Zanased Puntsag
  • “I thank XacBank and Kiva a 1,000 times for helping my son.” – Mother of Bayasgalantogoldor Byambaa
  • “I want Kiva lenders to know I only borrower what I need, not what I can.  I know about the lending on the internet, and I am thankful for their support” – Borya Enhbat
  • “Thank you for helping my brother’s small business.  XacBank is different than the other banks in Mongolia.  They do not require collateral, and the loans officers do research in the field to make sure the loans are given to the right people.  The loan officers are very honest and loyal people.” – Sister of Tumenbayar Nerguy

Last fall, I had the opportunity to volunteer as a management consultant in the Kiva office.  I loved the concept of Kiva and deeply respected the staff, but I kept wondering, “Does this really work?” 

After being at XacBank this summer, I have seen firsthand that microloans can change people’s lives for the better.  Like its role model status in the microfinance industry, XacBank is also paving the way for innovative ways to use the Kiva capital to benefit the borrower.

Kharkhorin Branch Visit

Baganuur Loan Officers

By Tamara Sanderson, KF8, Mongolia

You know you are a Super Lender if:

A)     You mark the 15^th on your calendar and know the order that repayments will be made based on MFI.  You also have difficulty sleeping on the 14^th from the anticipation.

B)      Your Facebook wall is filled with “[Insert Your Name]  supported [Insert Foreign Name] with Kiva.org”

C)      It requires multiple scrolls and next page clicks to see all the loans on your Kiva Profile

D)     KivaFriends.org is your second favorite website after Kiva.org

E)      Your friends and family have been recruited to Kiva in every form possible.  Recruitment methods may include dinner table conversations, sending emails at check-out, lending team invitations, sending gift certificates, and even pouting until they get on their laptops to register

F)      50% of the emails in your inbox are from Kiva

G)     You are reading this blog, even though you are not related to me   

H)     All of the above

Well, this blog is for you, Super Lenders.  You have played a huge part in Kiva’s exponential growth since its launch in 2005! 

After receiving my Kiva Fellows placement in Mongolia, I went online to Kiva.org and saw that the latest activity was from a woman living in Ulaanbaatar to an entrepreneur in Ulaanbaatar.  I, of course, took this as a sign and quickly sent her a lender email with all my questions about Mongolia.  

A few months later, I was able to meet Kimberly in person.  She has lived in Mongolia the past three years, helping with the business development of a horseback riding tourist camp, volunteering with Habitat for Humanity and learning Mongolian.

When describing Kiva, she compared it to a toolbox – you can give the entrepreneurs the tools needed to succeed and can then pass it on to the next one. 

Last week, she was recognized at XacBank’s Kiva publicity event, as our #1 lender, with over 100 Mongolian loans thus far.  Kimberly freely floated through the audience, telling everyone about Kiva.  In fact, the XacBank CEO was so impressed that he interviewed her last week for an IT position, and she has been invited to their upcoming offsite meeting.  

I imagine that there are lots of “Kimberlies” out there on Kiva and want to tell you THANK YOU!   You have made Kiva what it is today and have helped change the lives of the working poor.

Kimberly speaking at the Kiva – XacBank publicity event

Kimberly discussing Kiva with representatives of Friends of Mongolia

By Tamara Sanderson – KF8 Mongolia

When I started telling my friends and family that I was headed to Mongolia for the summer, it quickly became apparent that few people know much about the country.  Comments ranged from: “So, where in Africa is Mongolia?” to “I remember that Genghis Kahn fellow from history class.”

Every day, I am realizing the uniqueness of this beautiful country and would like to share a few fun facts with other Kivans.

Large and Landlocked

Mongolia, the second largest landlocked country in the world, is sandwiched between China and Russia.  It is one of the highest countries in the world with an average elevation of 1580 meters, which quickly became apparent when hiking at the XacBank retreat (I was out of breath within a few minutes).

Mongolia is home of the Gobi desert, where fossilized dinosaurs were found in the 1920s, and it now boasts the title of having the largest horseman statue in the world (please note the size of the car in relation to the statue)!

Team at the XacBank retreat (Maggie, Kiva Coordinator, is on the far left)

Genghis Khan statue about 30 minutes outside of Ulaanbaatar

Brrr….

In the winter, the temperature in Ulaanbaatar, the capital city, sits around -40 Celsius, making it the coldest capital city in the world.  Although Mongolia has a small population, the coal burnt in the winter has created severe air pollution.  Let’s just say I’m glad to be here in the summer, unlike the previous Kiva Fellow, Mark Bulliet, who suffered through the long, cold winter.

Living Nomads

Sometimes I consider myself a bit of an urban nomad, jetting to new cities and countries every few months, but it pales in comparison to the legitimate nomads of Mongolia.  Approximately 25% of the population is nomadic, and another 25% of the population is semi-nomadic.

These people live in “gers” or “yurts,” which are tents made of a circular wooden frame and a felt cover.   A stove in the middle of the “ger” heats up the dwelling, and there is no running water.  Roughly, four out of five Kiva borrowers from Mongolia live in “gers,” so check it out next time you lend.

“Ger” of Kiva entrepreneur, Tsolmon Dashdorj

Horse to Person Ratio

Although I am from Texas, I think I have seen more horses here in Mongolia in the past few weeks than in the past 25 years of my life.  The horse to person ratio in Mongolia is 13:1 – about 33 million horses in a country of 2.6 million people.  Few fences exist in the Mongolia, so pockets of animals wander free in the countryside, and the annual Naadam festival hosts a horse riding completion 15-30 km long with children ages 5 to 13 as the jockeys.

In addition, Mongolia is the home of the Przewalski’s Horse, which is the only truly undomesticated horse left in the world, with only about 250 existing still in the wild.

Przewalksi horses at the Khustain Nuruu National Park

Urban horses near XacBank's branch in Baganuur

If you are looking for a magical country to suit your wanderlust – check out Mongolia.  In the meantime, please join our lending team here and experience Mongolia through the stories of Mongolian entrepreneurs!

Why is it that when you’re just starting a job, you always introduce yourself to the CEO with spinach in your teeth, or rip your pants pocket, or spill toner on your shirt?

My finest hour was when I was starting on the copy desk at a newspaper, trying to make a good impression as a head-down, able worker, and the copy chief gave me a big story. I had my take-out dinner on my desk. As I stared intently at the screen, trying to be the model of a journalist who’s so totally engrossed in the task at hand he can’t even be bothered to look at his food, I gave my Orangina a vigorous shake, as instructed on the bottle. Forgetting about the cap. Which was off.

The guy sitting next to me said he couldn’t believe his eyes: me just shaking this bottle, the bright-yellow fizzy drink flying everywhere. And it took me a second to catch on, too: even as I felt myself getting I drenched I think I was in disbelief at the sheer stupidity of what I was doing, so I kept right on shaking the bottle for another second, soaking my clothes, dinner, and workstation in sugary goodness.

Yeah, I’m awesome.

So I’m on Day 2 as a Kiva Fellow at XacBank, here in Ulaanbaatar, Mongolia. XacBank is the first microfinance institution Kiva has partnered with in this country, and I have been given specific instructions to make a good first impression as a Kiva representative because Kiva is super-excited about the partnership. And I am, too: I’ve been pumped to get to Mongolia ever since I heard Kiva would be starting operations here.

In Azerbaijan, where I spent about two months as a Fellow before coming here, each of the MFIs I worked with rents a few rooms and has a few employees in their main office. I got to know the CEOs personally. We all wore sweaters to work most days. The employees were tight, like families.

XacBank (pronounced haas-bank) is like — well, a bank. It’s a microfinance bank, but it’s definitely a bank. Gleaming marble floors. ATMs. Currency exchange. An HR department. Fatigue-wearing security guards with guns. Suits and ties. A conference room with snazzy rolling chairs.

So, of course, Day 2, I break a mug right in the hallway by the stairs, the most high-traffic part of the office. I’m actually thinking, as I put the mug down on the blatantly-neither-flat-nor-level Hyundai water cooler (see photo): “This sure seems likely to fall, as this is not a flat surface.” I’m actually thinking that.

This is not a flat surface.

And this is not a new experience. I’ve been down this road before, either thinking “if I back up any more, I’ll put my tail light out on that fire hydrant,” or “if I flick this cigarette butt that way, it’ll hit that dude’s Harley,” and then proceeding to do it anyway.

So now I’m picking up broken ceramic shards and apologizing to whoever walks by. And I’m having a lousy day — I’m new to this country, it’s freezing cold, there’s bad news coming by e-mail from home and I’m too far away to be of help, I feel lonely and jet-lagged — and I’m experiencing wave after wave of let’s-call-the-new-guy-’butterfingers’ shame.