Posts filed under ‘ADIM (Asociación Alternativa Para el Desarrollo Integral de las Mujeres)’
A Rainy Day in Masaya
By Jason Jones, KF15, Nicaragua
It’s Wednesday, the third day of my Kiva Fellowship here in Nicaragua. After a short ride on a motorcycle, a relatively long walk, two different vans (OK…so the first one MAY have been due to an error on my part) and one taxi, I’ve finally arrived to a small meeting area outside the town of Masaya. As I enter the gathering, I find approximately twenty women sitting around a U-shaped arrangement of tables. They are the “entrepreneurs”, the owners of small businesses that have come today for a training session on the topic of Business Development. Unlike me, they seem to have arrived in a relatively timely manner despite the morning rain. Fortunately, they don’t judge too harshly.
A Day of Business Development
To understand why we are here today, I should probably begin with a brief explanation. With an overall mission of connecting people through lending to alleviate poverty, Kiva partners with 133 microfinance institutions in 60 countries throughout the world. After making a loan through the Kiva website, these funds make their way from the lender (you?)……to Kiva……to a local MFI…….to individuals such as those sitting in front me on this rainy morning in Central America. By receiving such loans, these women are given the opportunity to grow, improve, or enhance their businesses for the economic benefit of themselves and their families.
As for the reason behind MY particular presence, that’s a slightly different story. Through Kiva’s Fellowship Program, individuals such as me are sent to the various field partners (MFIs such as ADIM) in one of those 60 countries I mentioned before. I would describe the actual work of the fellows as a combination of such roles as accountant, journalist, photographer/videographer, customer service liaison, globetrotter, business consultant, and auditor. It involves such objectives as being Kiva’s “eyes and ears in the field” and “increasing the impact of Kiva’s global mission”, but in the end really just comes down to creating or maintaining a connection between those four distinct groups in the Kiva model; lenders, Kiva, MFIs, and borrowers. Two weeks ago, while participating in a training session at Kiva’s central office in San Francisco, I was wondering why I hadn’t dressed more appropriately for the cold weather. Today, I find myself sweating in the tropics.
As I am continually learning as a relative newcomer to the world of microfinance, NOT ALL MICROFINANCE INSTITUTIONS ARE CREATED EQUAL. Of course, when evaluating a particular organization, one always wants to consider such obvious factors as geographic location, size, history, portfolio yield, return on assets, operational sustainability, and that ever-present struggle between the red and black numbers at the bottom of the page. But in a world of mission statements often describing a particular institution’s reason for existence with such phrases as “improving quality of life to specific sectors”, “helping the poor to improve their livelihood”, and “offer financial services to marginalized communities”, the often overlooked SOCIAL PERFORMANCE of an organization remains a vital component of an accurate assessment.
ADIM is a microfinance institution dedicated to entrepreneurial development, especially of female entrepreneurs in peripheral urban and rural areas, to help them move towards transcendence, personal affirmation and evolution into more equitable relationships.
This is the mission statement of ADIM, a small microfinance institution located in Nicaragua. ADIM has been operating in the area for 22 years now and believes strongly that although financial assistance is certainly an important piece, it’s not the entire puzzle. For this reason, they offer their clients (90% of which are women) classes on such topics as identity and self esteem, economic independence, basic accounting, and a variety of themes involving success in the marketplace. Today as I make my entrance, they are giving testimonials with regard to how previous sessions have positively impacted their lives and businesses. After listening for several minutes and giving an impromptu introduction, I ask if anyone in the group has been the recipient of a Kiva loan. One has to remember that although a number of ADIM’s clients do receive loans through Kiva, there are also those that do not. After a moment or two of puzzled looks from the majority of those present, four hands eventually go up. Today, amongst this group of twenty borrowers, it looks as though Kiva has been responsible for 20% of the loans. From there, the stories begin.
Maura with her flowers
Maura is a 39 year old florist who has come today with her teenage daughter. 15 years ago, in an attempt to learn the trade, she began working in local flower shops around Managua. Since no one was willing to pay her for her work at that time, she simply acted as free labor until she gained enough knowledge to be on her own. Although her business remains very small to date, she tells me that it has grown considerably from what it was in the beginning. With her recent loan through Kiva, she’s excited for the opportunity to boost her inventory in preparation for what is perhaps the largest day for the floral industry here in Nicaragua, namely Mother’s Day.
A few of Gloria's purses
Another one of today’s attendees is 23 year old Gloria, who began working with leather several years ago. What began with an initial focus on shoes quickly grew to include purses, wallets, belts, hats, briefcases, etc. In 2010 she, along with two other members of her borrower-group, received an $800 loan from Kiva. With the subsequent improvements to her business and her increased knowledge through ADIM’s training program, Gloria went on to qualify for an additional $1500 in the form of an international grant. Now with a new workshop to call her own and further recognition that has come recently in the local media, she claims that business is better than ever.
I could certainly go on. Adelfa mentions that her Kiva loan has allowed her to purchase beauty products of much higher quality to sell in her small store. As a result, her profit margin has increased significantly. Through a separate Kiva loan, Mayra has been able to raise her inventory as well. In her business of “intimate apparel”, she too reports that sales are up and talks of potential loans in the future.
And so the day continues. We complete the testimonials, several educative sessions, lunch, and a demonstration of products by a number of the entrepreneurs. Before the inevitable departure, the group is given one final surprise in the form of being serenaded with several songs from Mayra, all in honor of the upcoming Mother’s Day. As I make my way back to Managua, I see that the rain has stopped, and I experience a small victory of my own by successfully boarding the right bus in the right direction. While traveling in the northern direction, I can’t help but reflect upon the day. I think it’s fair to say that the borrowers represented by today’s cross section would not be considered to be OVERTLY successful by much of the world’s standard. For the most part, they are simply owners of very small businesses trying to make it from one month to the next. Is microfinance the answers to ALL of their problems? Of course not. Is immediate radical transformation experienced following a simple training seminar? Most likely, no. But from what I’ve witnessed over the last 8 hours, I have to say that this group is certainly heading in the right direction. At some point and in some form, a positive difference is being made along the way. And for that, I also have to say that despite the afternoon showers, it’s been a pretty nice day.
Now…..which one is my stop??
How To Make Shoes and Rice With One Flame
A Kiva entrepreneur’s business intertwined with his home and family.
Continue Reading 14 February 2010 at 12:30 Monica Ann Bernadette 9 comments
A 25 pound sack of sugar.
Despite entrepreneurial skills, and dedicated work ethic many entrepreneurs are a single business mistake, illness, or natural disaster away from starting at square one.
Continue Reading 15 May 2009 at 10:21 ashleyolivia 3 comments
Microfinance and the Bottom Billion
I recently picked up The Bottom Billion: Why the Poorest Countries Are Failing and What Can Be Done About It by Paul Collier, Professor of Economics and Director for the Study of African Economics at Oxford University and former director of Development Research at the World Bank. It has been a grim and simultaneously enlightening book, dubbed as a must-read by the New York Times and set to become a classic according to the Economist.
In a nutshell, The Bottom Billion states that our perception of development for the last forty years has been a rich world of one billion people facing a poor world of five billion people. However, this thinking will soon be outdated because most (80%) of the five billion live in countries that are developing, and at amazing speed. The real challenge for development lies in the one billion people at the bottom who live in countries that are falling behind and oftentimes falling apart.
These one billion remain mired in extreme poverty because of four “traps” that must be dealt with. The first trap from which poverty stems is “the conflict trap” – civil wars or coup d’états that are costly and can be repetitive. The second trap is “the natural resource trap” – dependence on certain resources (oil, minerals) that actually stifle economic growth. Third, poverty can come from being “landlocked with bad neighbors” – a lack of access to ports and bad neighbors translates to no trade. The last trap is “bad governance in a small country” – terrible governance and bad policies can quickly destroy an economy.
Collier also proposes several plans of attack on poverty that focus on the bottom billion. Wealthy nations have too often subscribed to the myth that the fight against poverty must focus on poverty everywhere. This might be why microfinance hasn’t been successful in accessing the absolute bottom of the pyramid and eliminating the most extreme poverty. Microfinance institutions have mostly been drawn to the more attractive business case of serving clients who are not in the bottom billion – in fact, only about 5-10% of microfinance funds ever reach the poorest of the poor.
What microfinance needs to begin doing, is to branch out beyond the mainstream to include a focus on the bottom billion. Tom Coleman, founder of Microfinance Consulting and former Director of Research and Development for the Chicago Board of Trade (CBOT), calls it Bottom Billion Microfinance (BBM). How can we re-channel our focus to highlight this population? Two-thirds of the bottom billion live in only four countries – so we can begin there. Further, a modest 15 countries have the highest concentration of people living on less than $1/day, and together represent 80% of all people who live on less than $1/day. A total of 31 countries have over 40% of their people in the bottom billion – most are in Africa.
The important questions we need to answer are: what kinds of holistic poverty-ending services should microfinance provide? What kinds of incentives can increase the number of bottom billion served, and the quality of services they receive? Ending poverty is not a financial services-only business. Microfinance has made remarkable strides since its conception in the 1970s. As our world continues to develop, we must continually revisit how we’ve been fighting poverty. We must establish new techniques and standards so that the bottom billion are not left behind.
ADIM: A Boutique Microfinancier
I have been working with ADIM in Nicaragua for just over one month now, enough time to get a pretty advanced rough picture of how this organization works. It has been an interesting four weeks, the first two of which found me frantically trying to keep up with the high-speed pace and lively Spanish chatter of Javier Flores, the organization’s Credit Manager, who is also responsible for managing much of ADIM’s relationship with Kiva. I also found myself with a bit much downtime, which, ironically, stressed me out since I had so much to do during the three months I would be in Nicaragua. We had a partnership to cultivate, after all.
Although I have found that the Latin reputation for leading a slower pace of life (both personally and professionally) does apply generally to Nicaragua, it does not hold true in this particular case; rather, ADIM is a very small organization, and it was in the middle of planning/budget season, so I guess I just happened to arrived at an especially busy time. The biggest challenge was getting the ball rolling. And now, thankfully, it has.
A few stats on ADIM:
- ~40 employees
- 8 branch offices
- ~$500,000 gross loan portfolio
- ~$170 average loan size
- Serves 90% women, both individual and group loans
- Currently has a 3-star rating on Kiva and hoping to go from pilot to active very soon
- Smallest member of ASOMIF (Nicaraguan Association of Microfinance Institutions)
Overall, ADIM is a very pretty and put together organization. In my time here, I have observed high levels of camaraderie, a genuine interest in helping fellow Nicaraguans, and excellent work ethic. Even peer organizations have noted the charm and virtue of ADIM.
I have more recently been spending the majority of my days in the branch office in Masaya, where most of the Kiva magic happens. Most of ADIM’s Kiva loans are disbursed through this branch, and ADIM plans to channel all Kiva funds through here in the near future. Branch Manager María Violeta Perez Muñoz (Violeta), in collaboration with Javier, is credited with managing a lot of the Kiva process. Check out the video of the Masaya office below.
You can find more information on ADIM and its fundraising loans by clicking here.
Join Team Nicaragua by clicking here while you’re at it!
Christmas in July
Nicaragua is taking the “Christmas in July” concept to a whole new level. The famous (or infamous, depending on who you’re asking) first lady, Rosario Murillo, commissioned the placement of giant, ostentatious Christmas trees in each of the several rotondas (roundabouts) scattered throughout Managua. Placed there in October 2008, the trees have overstayed their welcome well into 2009. And Nicaraguenses can plan on enjoying these magnificent, lit trees against the horizon for at least the next several months. Murillo has ordained that every tree gets the number 30 put on top of it and that it stay in place through the summer to commemorate the 30th anniversary of the Sandinista revolution.
Perhaps even more interesting than the trees in the rotondas are the small groups of people, called los rezadores (“the prayers”), that stand in these same roundabouts throughout the day (and sometimes at night, too) waving the national flag (which, incidentally, has gone through more changes than many celebrities’ noses) and chanting that love is greater than hate. Paid 200 cordobas (or US$10) and provided three meals per day by the government to propagate the Sandinista message (in an effort to make the government more popular with the people), these typically poor citizens actually oftentimes end up unpaid, and a little worse for the wear.
I have been very impressed by the average Nicaraguan’s knowledge of the political situation of his/her country, perhaps because it hits so close to home and profoundly affects each and every person, at all social strata and on a daily basis. I have not been so impressed with the all-too common disillusionment and impotency to affect change felt by most people with whom I’ve spoken. And on that note of empowerment (or lack thereof), the average middle-class citizen here is quite interested in having access to microfinance services – as if microfinance is the mainstream credit service for the country. Which it probably is, considering that half of the population lives in poverty.
Nicaragua, along with the rest of the world, is in trying times. But what is unique about this country’s crisis is that it spans to include a recent, turbulent and violent political history that remains to be settled. Perhaps Murillo and los rezadores she has commissioned should reconsider the extension of the holiday season and what exactly they are praying for.
More to come soon about my MFI, ADIM. You can help out ADIM clients here. Feliz Navidad!
Calling for all T-shirts
So I’ve spent the last three months in San Francisco, anticipating my Kiva adventure in Nicaragua and familiarizing myself with the various players in the surprisingly small microfinance network. Now, I’m just four short days away from embarking.
Excited? Yes. Nervous? Definitely. Ready? Well, I don’t think it really matters at this point. The best way to learn, it can be said, is to throw yourself right into it.
Speaking of getting ready, I had a really great idea (or so it seemed at the time) on how to assemble an ideal wardrobe for my work in Nicaragua. T-shirts. I figured, since I’m going to be spending my days in the field, on the backs of buses and motorcycles, in the heart of Central American rurality, what better accessory to have than innumerable T-shirts. So, I started up this whole armamentarium, collecting unused, oftentimes old and unwanted, yet still charitable, donations from my friends. One of my friends in the Bay Area startup world had an even greater idea: let’s hop in the car, drive around to various startups, and ask for t-shirt donations. While it never happened, by the end of this venture, I had amassed far more t-shirts than a girl can hope to possess.
But wait, the punch. I emailed the Director of Finance of my MFI (ADIM) a few days ago, inquiring as to what the dress code is. His words: “Como gustes, no tan informal que contraríe la presentación normal de una oficinista,” or, “Whatever you prefer, but not so informal as to contradict the presentation of an office worker.” Well…that pretty much rules out t-shirts. Sigh. I guess I’ll have to give myself an A for effort. And now I have a lot more t-shirts.
While the above story marks a humorous beginning to my upcoming journey, what it comes down to is this: I am at a stage in my life where I am ready to make a tangible impact. I want to throw caution to the wind, let go of the comforts to which I am accustomed, and experiment with the road less traveled to get to my final destination…helping the world get that much closer to eradicating poverty.
More to come soon from Managua, Nicaragua!
