By Hanh Tran, KF8 – Fund for Thanh Hoa Poor Women (FPW) – Vietnam

Visiting borrowers during the past three weeks has taught me that interviews can take place just about anywhere– standing in the middle of a noisy market, sitting on very short stools near a street stall or squatting on someone’s kitchen floor.

Earlier this week, Ms. Ha, a credit officer at the Fund for Thanh Hoa Poor Women (FPW), offered to take me to three repayment meetings. I grabbed my bag – which nowadays contains my handy Flip video camera, a notepad, my pocket dictionary, and borrower group photos – and we set off.

An hour later, we found ourselves at a lively market in Dong Son District. Searching for borrowers in between the rows of colorful fruits and vegetables, fresh cut flowers and delicate china turned out to be quite the task. With Ms. Ha’s expertise, we managed to track down all six women belonging to the 11-Don Son Group.

Our next stop was to the home of a first time borrower, Ms. Phuong. Once there, I spent time with a group of four women, asking questions and listening as they gossiped and teased each other.

The final meeting for the day was at a local Women’s Union center where I was able to catch a few short interviews as group members dashed in to make their monthly repayments and rushed back to work as quickly as they came.

If I could, I would spend hours talking to each borrower. I realize the questions that I am able to ask during the short amount of time I have with the women only offers a glimpse into their lives – a small chapter of the full story. Yet, in those few moments, there is a connection. The hours pass by quickly and at the end of the day, I have footage, pictures and pages of notes. Here are a two of their stories.

Meet Ms. Lien

When Ms. Lien told me that she makes “than” I had to dig in my bag for my pocket dictionary. In the time it took me to find the translation, Ms. Lien had brought a bucket of coal blocks to show me what “than” was.

Ms. Lien is 28 years old and the youngest member of her group. She tells me that everything she does is for her two children. Ms. Lien and her husband can make up to 1,000 blocks of coal in one day. The recent loan from FPW helped pay for repairs to the machine that they use. On rainy days, the business comes to a halt since the coal needs to dry in the sun. On a good day, the couple can sell 300 blocks for a profit of 60,000 VND ($3 USD). A woman of few words, Ms. Lien then takes my hand and pulls me outside to demonstrate how the coal blocks are actually made.

As Ms. Ha and I watched Ms. Lien work with the sun beaming down on her hat, I thought about how the profits from Ms. Lien’s business might help to provide more opportunities for her two young children in the future. We said our goodbyes and Ms. Lien continued her work. You never know when the rain will come.

Meet Ms. Trinh

We found Ms. Trinh sitting in between a stall lined with assorted spices and a stand selling sets of baby clothing. Interviews at the market are some of the most interesting that I have had. It’s amazing to watch the women in action as they answer questions and make change for customers at the same time. Talk about multi-tasking!

Ms. Trinh at her market stall

With her youthful energy, Ms. Trinh tells me that she “sells many many things!” At 60 years old, she recently expanded her stall with an impressive variety of kitchenware – pots and pans, fish sauce (nuoc mam), teapots, spices, mops, rice cookers, scissors, chopsticks, dishwashing liquid…the list goes on…

Ms. Trinh says that the market is like her second home. She has no intentions of retiring any time soon because her profits are needed to pay for her daughter’s tuition and lodging fees at Hanoi University. Ms. Trinh estimates that her monthly profit has grown from 1,500,000 VND ($84 USD) to 1,800,000 VND ($101 USD) since taking out her first loan with FPW.

Usually, when I ask borrowers about their dreams, there is a moment of hesitation. This was not true with Ms. Trinh. Full of energy, she tells me, “I want to travel.” I’ve heard this answer before, but then she adds, “to the places where people have given loans. I would go there to say thank you.”

I get to hear these sentiments day in and out – and those thank yous are truly meant for all the people who show their support through lending. So until Ms. Trinh makes her way to your neck of the woods, I’d like to send her message of appreciation to you. Thank you Kiva Lenders!

Hanh Tran is serving as a Kiva Fellow in Vietnam with the Fund for Thanh Hoa Poor Women (KF8). Click here to view currently fundraising loans from the Fund for Thanh Hoa Poor Women. Join the Vietnam Critical Mass lending team to support entrepreneurs in Vietnam!

By: Nilima Achwal, KF8 Bolivia

I rode on the back of a motorcycle with a loan officer while going to visit Kiva clients on the outskirts of Cochabamba, Bolivia. As my hair blew in the wind, I took in the tranquil green pastures, spotted cows grazing, and women in colorful skirts strolling down the dirt road. When we stopped, I exclaimed, “I love this part of town!” “Really?” the loan officer answered in shock. “I thought you would be horrified; this is the poorest section of town.”

I didn’t quite know how to respond to that. True, I had noticed that the area was very poor, but I had thought it was beautiful how each home had its own chickens and livestock and the residents wore traditional clothing. I suddenly felt ashamed, as if I were viewing this community like a sheltered tourist who did not fully realize or empathize with the economic realities of its inhabitants. But on the other hand, isn’t it necessary to see the beauty in poor communities and its people? Isn’t that what inspires me to help them?

I realized that the conflict I was going through has something to do with the specific idea of poverty that the developed world has. Earlier that day, when I was showing a Bolivian colleague my blog post on the Lonely Planet Bolivia website, the first thing to pop up was a picture of the perfect poverty poster child: a chubby-cheeked Bolivian girl with desperate eyes and dirty hair (with absolutely no offense to Lonely Planet—I agree that there are almost always more positive pictures on the site and in the books.) My colleague was understandably upset. “I don’t understand why every time people talk about Bolivia, all they show is the poverty. There are many beautiful and interesting places here.”

She made a very good point. The images of the developing world that dominate the perceptions of most Americans, that is, those that are propagated by the media, are of dire poverty, filth, and crime. This is most likely not a malicious attempt to malign other nations, but a reflection of the stories that sell. People are fascinated by extremes and probably like the reassurance that their own country is the best place to live. Then I realized why I was feeling conflicted–I did not want to be fascinated by my first exposure in Bolivia to what American ideology has taught me is Poverty: women in plaid skirts, men in farmer hats, donkeys, and dirt roads. I did not want to be a tourist of poverty.

I realize now that that is not the reason I liked the poor section of Cochabamba. On the contrary, I saw the care that went into the mini-farms and dairy businesses that the residents owned. I saw laughter, camaraderie, and hard work. If this community of people did not find anything either wrong or shameful about how they lived, why should I? I had no reason to pity them or be horrified at their “condition.”

At some point, the images of poverty that we constantly receive from television and movies stop enhancing our worldview and start becoming disrespectful to the citizens of those nations. We need to be careful not to lump all residents of the developing world into the big black box called Poverty. Not only do developing nations have a million other aspects to them besides their poverty (like colleges, concerts, sports, architecture, cultures, sub-cultures, natural wonders, technologies, and innovations,) but even their poor are surprisingly diverse. The fact is that the Kiva entrepreneurs I’ve met have had many, many different lifestyles and occupations. I have met butchers, make-up saleswomen, and store owners. Some entrepreneurs have televisions and DVD players but no running water. Some entrepreneurs ask me for the Kiva website address, while other people in their very group do not understand what the Internet is. Almost every entrepreneur I meet in Bolivia has a cell phone, though almost no one has a land line. They are elderly women, families, recently married couples, and young individuals just starting out. The faces of the Kiva entrepreneurs within Bolivia are amazingly varied, and I dare to say that the vast majority of their children have neither dirty hair nor sad eyes.

Nilima Achwal is a Kiva Fellow who is working with several branches of Fundación AgroCapital in Bolivia this summer. Lend to an AgroCapital entrepreneur now!

by Cissy DeLuca, KF8 Indonesia

At TLM, there is an informal uniform code for each day of the week. Mondays are for blue shirts, Tuesdays are for orange, Wednesdays we wear green, Thursdays the staff wear the TLM batik and Fridays are for custom made blue and white shirts. On the back of these shirts reads, “Give your heart to love, Give your hands to serve.”

Roni, a TLM loan officer, in the field

In previous experiences working in the development sector, I noticed many NGO and government workers often treated villagers in a manner I found less than acceptable.  Nurses would be verbally, and sometimes physically, abusive towards the mothers who came for monthly baby weighing services. Berating them for not forming a proper line and rudely hurrying them along as they removed the carefully chosen outfit they had dressed their baby in for the event. NGO workers would breeze into a village unannounced in their private air-conditioned SUVs acting like their time was more valuable than the community’s time. Rudely expecting the village to scurry for a chair, fresh water, a translator and accommodate all their needs. Development work serves the purpose of bridging the gap between the rich and the poor, but these people widened it with their social behavior. In short, these situations broke my heart and greatly discouraged me.

Working with TLM has been a a breath of fresh air and reminded me what development work can, and should, be all about. Their strong Christian affiliation really shows in their demeanor. They treat their clients with dignity, respect and kindness. They are very patient when gathering and explaining information and do not take a condescending approach.

Roni explains the client waiver

TLM only posts group loans to the Kiva website, so visits for borrower profiles take a very long time. After driving an hour or more to reach a village, they often spend an hour waiting for the group to assemble. Once the group assembles, they take an individual picture of each member. They then organize the clients for the group photo to be published on the website. After the pictures have been taken, they take the time to explain to the clients what Kiva is and that their photo will be viewed by millions of people. Each group member must then sign a release waiver. After all members have signed, the loan officer interviews the group leader to get information to write a compelling borrower profile. The whole ordeal from start to finish can take up to 5 hours for one single loan on Kiva!

Maybe the TLM staff members simply enjoy getting out of the office, but I think the enjoyment comes from giving their hands to serve. Their humble approach to performing their jobs is beyond inspiring. It is comforting to know that from the pockets of the generous Kiva lenders, through the technology of the socially minded Kiva staff to the on-the-ground initiative of the attentive TLM staff… Kiva/ TLM loans are handled with love from start to finish.

Me and Shanty

Cissy DeLuca is working with Tanaoba Lais Manekat Foundation in Kupang, West Timor, Indonesia. Please join their lending team or loan to their currently fundraising clients!

By Joel Carlman, KF8 – Kisumu Medical & Education Trust – Kisumu, Kenya

Over the years, there have been many entries on this site (and on many others) about the popular topic of group lending.  The fact that borrowers gather once a week, or once a month to deal with any issues they might have or to keep each other accountable is incredible.  That group lending has tended to lead to higher repayment rates is a fun little factoid that practitioners of microfinance love to point out.  But, that only represents the utility of group lending.  Yes, it works, but it’s also beautiful in practice.

Recently, I had the chance to travel a few hours south of Kisumu to two borrower groups.  One is located in the rural community of Bware, and the other in the more urban-feeling town of Rongo.  Both groups taught me a lot about what group lending is all about, and why, besides serving a utilitarian function, it can also be beautiful.

Our first stop was a relatively brief one in Bware, a small community in the rural area outside of Migori, the bustling border town you cross just before entering Tanzania.  When we pulled up in our vehicle, I could hear singing and clapping.  The women (this group is all women) scooted close together on their make-shift bench to allow me a spot while several of their peers led the group in a traditional song of celebration.  They were happy to see each other, and to be a part of something that was good for them and for their community.

After the payments were collected, and the members allowed time to bring up any issues they might have on their mind, we were on our way to Rongo.  The members of the Rongo group—once again all women—were waiting patiently as we arrived at the field in front of the town hall.  I was quickly introduced to the leadership board of the group: chairperson, treasurer, and secretary; and then I was told the name of the group: ROCOSHP (like “roh-coh-shop”) which stands for Rongo Community Orphan Support and Healthcare Programme—there isn’t even anything in the name that mentions loans or microfinance!

These women were organized not around getting money, but around the shared vision of supporting the disadvantaged children and families in their community.  For me, it was just another example of how innovative K-MET has been in using microfinance to come alongside initiatives that are working and give them a big boost.  The group was passionate about their mission—evidenced when they asked a small man named Jack to stand (I hadn’t seen him when we first arrived).  As soon as he stood, I realized that the sport coat he was wearing hung close to his torso—he was missing both of his arms.  The chairwoman told me that the group was holding a fundraiser the following week in order to raise money to buy Jack at least one prosthetic arm (but they were shooting for two).

The group seemed incredibly close knit, though there were close to a hundred women in attendance.  They were laughing with each other and smiles could be seen all around—and yet they took their businesses very seriously, and have an intense system for self-monitoring.  The women screen all new loan applicants themselves.  When a small group of new borrowers is formed, they are paraded in front of the larger group of 50 or 60 people.  The loan amounts they have applied for are announced to the entire group, and all of the other members are allowed to chime in and say any reasons why this person might not be able to repay their loan.  It reminded me of the part in weddings where the minister says, “Speak now or forever hold your peace,” only here, women actually speak their piece.  Many times, K-MET approves a person for a 30,000 Kshs loan, and yet the group decides that they should start with a smaller amount, or sometimes, not get a loan at all.  In fact, some members in attendance had been denied a loan the month before—and they were still attending the meetings!  The group dynamic is a very powerful one, and K-MET tries to empower them as much as possible by allowing them to making these decisions on their own.

Once a month, at a gathering like this, the existing borrowers make their payments.  If even a single payment is missing from the entire group, the new borrowers don’t get their money that month.  Usually, in a missing repayment situation, the people who did not pay have their names read aloud, and questions are asked regarding their whereabouts.  If they can’t be located, other members from the group will make the payments for them, and deal with collecting the missing funds themselves during the month.

After leaving the Rongo group, I had a lot of thoughts about this model of microfinance.  From everything I have seen, it works.  But it turns out that the encounter I had that day was less about microfinance and more about community.  I thought of the African idea of Ubuntu— I am because we are.  In the context of rural Kenya, the group meeting, the sharing of burdens, the accountability of each member, and the dedication to impacting one’s community just works.  It might not work in India or Indonesia or Mexico or even neighboring Tanzania—or maybe it works in a different form.  All I can say is that I met these women, and it works for them.  I began to wonder if something like this would ever work in the U.S.—to an extent, American individualism has allowed people to achieve success without being tied down by other people.  But, in this context, one of the reasons for these women’s success is that their businesses, their families, and their futures are tied together.

Joel Carlman is in his 5th week as a Kiva Fellow with K-MET in Kisumu, Kenya.  To learn more about becoming a Kiva Fellow, click here.  To join K-MET’s lending team, click here.

By: Athan Makansi – KF8 – SPBD, Samoa

Kiva is about stories.  From borrower profiles and journal updates, we learn about individual borrowers all over the world and their struggle to work themselves out of poverty.  But, some of the people most integral to the daily operations of Kiva are underrepresented on Kiva.org. Rarely do we hear stories about the credit officers all over the world who actually disburse the Kiva loans. Here are some profiles of the credit officers at South Pacific Business Development (SPBD) in Samoa.

At SPBD, the credit officers are called Center Managers (CMs).  The center manager’s job is to collect the weekly repayments from each SPBD borrower.  Monday through Thursday a center manager travels around the island to different borrower centers to collect repayments.  Each center consists of between 5 and 35 borrowers, usually all ladies from the same village.  On most Fridays, the Center Manager stays in the office to disburse new loans, prepare paper work for the next week, and count a lot of money.  Last week I accompanied one center manager, Ela, on her daily rounds.  Here is a video of our adventure.

At SPBD, there are twelve center managers broken into three teams of four.  Three center managers – Ela, Mayvian and Jack – took the time to let me interview them.

Ela

Ela is one of the newest members of the SPBD staff.  She joined only 1 year ago.  Before coming to SPBD, Ela worked in American Samoa as a phone operator and went to nursing school.  After being gone from her homeland a few years, she missed Samoa and wanted to see her family again.  Now she lives with her family on Manono Island, one of the tiniest islands in the South Pacific. The smallest of Samoa’s four islands, Manono is so small no cars are allowed on the island.  Not even any dogs are allowed on the Island.  In total there are only 4 villages, encompassing an area of one square mile and housing a population of around 1000.

Her one year as a center manager has only piqued her interest in microfinance.  She hopes to manage her own microfinance institution one day or to go to school to earn a degree in business administration.  Ela is 29 years old and single.

Mayvi

Mayvian Popese, known by her nickname Mayvi, is 28 years old with 2 children.  She lives in Vaipuna, just outside the capital city of Apia.  While her nine year old son is in his fifth year of school, Mayvi’s other son, only one and a half years old stays at home with his grandfather, Mayvi’s father.  Her husband owns a security company.  He trains security guards for government buildings and hotels.

Before coming to SPBD four years ago, Mayvi worked three jobs as an accountant – Radio Polynesia, a computer shop, and the local cinema.  Now at SPBD, Mayvi was recently appointed team leader of 3 three other center managers.  She has been in this position for one year.  Mayvi points to a few frustrating aspects of being a center manager.  Dealing with “bad clients,” the ones who don’t pay on time or skip the mandatory center meetings, can be difficult.  The center managers get all sorts of excuses. “It’s hard to chase after them” she gripes.

Most parts of the job are really enjoyable though.  At SPBD, Mayvi greatly enjoys “serving the hardworking ladies of her own country.” Working with the ladies brings Mayvi much more joy than working with the clients of her previous jobs.  In contrast to plain bookkeeping, Mayvi tackles much more practical problems, advising the ladies with their plantation business or their general store.  She likes watching the businesses grow and witnessing the impact of her work.  Always with a flower stuck behind her left ear, Mayvi is quick with a smile and laugh.

Jack

Jack Elisara is physically the most intimidating Center Manager at SPBD. This 6’ 8”, 280 pound, former rugby player has been working at SPBD for just over 2 years.  Rugby is certainly his first love. Jack has played rugby in New Zealand, Australia, Italy and Samoa, including a short while on the Samoan rugby union national team, Manu Samoa.  Jack describes his role as a prop forward as the “toughest” position and he brings the same toughness to his work as an SPBD center manager.  Jack works hard. Almost always finished his work before all the other CM’s he’s the first one to start chatting to me about the latest rugby news or ask me about my weeked.

Jack is 35 years old, married, with 2 children.  His son, 6 years old, is in primary school and his daughter, 2 years old, stays home with Jack’s wife. Before SPBD, Jack worked for a year as a tour guide for the Samoan Tourism Authority.  As the Tourism Authority went bankrupt, Jack was forced to find a new job and discovered SPBD.  Jack loves meeting clients and hearing their stories. He likes working to support the community, especially impoverished women.  Many of whom he has seen become very successful, opening multiple businesses, buying new houses, etc.  Moreover, he values the SPBD clients as leaders and mothers in his country.  Since he still lives with his mother at home, he cites a special connection to these women entrepreneurs. He has a greater appreciation for their struggles to raise a family and also run a business at the same time. He hopes SPBD will “really boost” its clients, especially the lower income ones.

Overtime

All the Center Managers work 9 hour days.  Every day they are on in the office by 8:30 and don’t leave until 5:30.  In the morning they arrive and quickly prepare some paperwork for the day and collect their repayment books.  Everyone is out the door by 9:15.  At around 4:30pm, the Center Managers return from their rounds and the next half-hour will be spent swapping stories from the day.  Most of it is done in Samoan so I don’t understand it.  But, it must be really hilarious because the office fills with laughter.  At about 5pm, the Center Managers realize they only have 30 more minutes before the office closes to count up all their money from the day and finish any paperwork.  The chatter slows down and all I hear is the clink of coins or the occasional curse as someone forgot what number they were on. 5:30 everyone rushes home, eager to relax.

Ela, Mayvi, Jack and the other nine CMs at SPBD work tirelessly for SPBD and by extension for Kiva.  Moreover, they all have been have been very kind and extremely accommodating to me.  Kiva Fellows are often stuck in a strange role: in order for us to do our jobs properly we need to interrupt the daily operations of the MFI staff.  Here at SPBD, the staff takes time they would normally spend on other business activities to let me train them on Kiva processes or just answer my questions.  Some of the staff has voluntarily stayed later than 5:30 for additional Kiva training and everyone has graciously accepted me into their ranks.  For that, I’m very grateful.

Lend to borrowers from SPBD!

Learn more about SPBD.

Athan Makansi, KF8,  is a Kiva Fellow serving his placement with South Pacific Business Development in Samoa.

By Susan Arthur, KF8 (Kiva Fellow 8th Class) in Nicaragua

Episodio 3: Doña Cony plans ahead.

In May, she planted a granadilla fruit tree in her back courtyard in Managua. It looks more like a vine, and it stands about five feet two inches tall, about the height of Doña Cony.

Granadillas Equals “Dineritos”

“It’s my plant that is going to bring me dineritos — monies,” says the 59-year-old wife and mother rolling her thumb back and forth over her finger tips to show the universal sign for money.

The yellow fruit has a floral scent, is oblong, the largest of the passionfruits –about the size of an American football — and weighs more than one pound.  Currently it sells for 20 cordobas (USD $1) each, which is half the cost of a cab fare in Managua or half the price of lunch. Not only will Doña Cony sell the fruit, but she also will make homemade, unsweetened granadilla juice at her new restaurant which she hopes to open and operate from her front porch next year. (See Microfinance Mundo Episodes 1, 2 and 2.5 for more background on Doña Cony’s room rental, ice cream, and catering businesses.)

The Family Tree

Married to Don Isaac, who has worked as a driver for the National Autonomous University of Nicaragua (UNAN) for 28 years and who plans to retire in two years, Doña Cony has no health insurance.  Their 40-year-old son, Jorge, lives with them and is in his last year studying political science at the private Hispano Americana University.

Isaac (left) and Jorge

Their 32-year-old daughter, Jenny, attended the University of Centroamerica, now a private university, where she studied translation and Teaching English as a Second Language. Jenny was forced to drop out in her third year when the university raised its fees from $20 a month to $80 a month. Because she could not find work, Jenny and her husband emigrated to Barcelona six years ago.

Like many Nicaraguans, Doña Cony and her family receive remittances from their daughter. Remittances represent more than 12 percent of Nicaragua’s gross domestic product.  In 2008, 40 percent of Nicaraguans received more than $750 million in remittances, according to a recent report published by the Impact of the Global Financial Crisis on Latin American and Caribbean Microfinance Institutions.“I don’t take advantage of my daughter,” stresses Doña Cony. “I want her to be independent and have her own life, and I don’t expect her to finance the family.”  Her daughter works as a home health aide and nanny in Spain and sends money so that Doña Cony can have an annual mammogram. Doña Cony’s mother died of breast cancer, and Doña Cony has had five benign cysts removed from her own breast. In Managua, a mammogram costs 650 cordobas  (USD $32.50).

Jenny also pays for her brother’s education which costs $35 a month, not including text books and photocopying of pages from the books he cannot afford to purchase. She wants him to be able to finish his degree which she was not able to do.

Jenny sent the family a used laptop which is missing a battery and pays for their wireless Internet connection. The family keeps in touch by calling each other every few weeks using Yahoo’s free Internet phone service with camera. During their most recent conversation the family members in Nicaragua winced when they heard about and saw the shiner and stitches that Jenny’s husband received from an accidental blow he suffered while practicing boxing at the gym.

How will Doña Cony and her family deal with the economic blows delivered by the falling world economy?

A recent study by the Inter-American Dialogue shows that in 2009 immigrants from Latin America and the Caribbean will remit US$64 billion, down from US$69 billion in 2008. About one million Latin American households who previously received remittances will not receive money in 2009, according to the IAD study, and another four million will receive 10 percent less.  These households will lose a significant source of earnings ranging from 7 percent to 65 percent of all income. Nicaragua is one of the most affected countries because the decline in money transfers will equal nearly 1 percent of the country’s GDP.

Will Doña Cony’s daughter be able to continue sending money to the family?  Will Doña Cony seek credit for her restaurant from one of Kiva’s field partners in Nicaragua? Will she apply at CEPRODEL?  What does she have to do to get a loan? Will she qualify? Stay tuned for future episodes of “As the Microfinance Mundo Turns.”

Susan Arthur is a Kiva Fellow (KF8) serving in Managua, Nicaragua with CEPRODEL. Join the Fans of Ceprodel Lending Team.

By Abby Gray, KF6/7, Togo & Senegal (now in New York)

In Dakar, this ad provoked vandals to rebel against the culturally inappropriate image. In New York, it wouldn't get a second glance.

If you have to deal with culture shock after 8 months of living in West Africa, New York is one of the most dramatic places to do it. On one hand, the vibrancy and energy of pedestrian-filled, trafficky New York streets isn’t all that different from the dusty “rues” of Dakar. Colorful fruit carts still grace the sidewalks, and overhearing conversations in foreign languages is a daily occurrence. On the other hand, skyscrapers and giant billboards of half-naked models are everywhere, as are exorbitant price tags on everything from purses to sushi dinners.

Having completed my official Kiva duties, I am now doing research at the Financial Access Initiative (FAI), a microfinance think-tank of sorts.  It’s a consortium of researchers from NYU, Harvard, Yale, and Innovations for Poverty Action, focused on expanding access to quality financial services for low-income individuals.

FAI researchers tackle questions big and small – from studies on the impact of microfinance (Does it really change lives?) to the most effective MFI program designs (Do lower interest rates improve repayment rates?) to industry-specific questions (What is the risk of owning female versus male calves?) .

These are exactly the types of questions that plagued me as I uploaded borrower profiles in my sweltering Senegalese conference room (especially the one about calf gender).  I’m really excited to be here tackling them, and I’m also excited to share some of our most interesting research pieces on the Kiva Fellows Blog!

I thought today would be a good day to drop my first line, because Kiva was mentioned on the FAI blog.  You can read the post here; there are some interesting observations on the perceived value of things being “free” rather than “cheap” – for example, lending on Kiva.org.

Cheers to all the Kiva Fellows still in the field, and bon courage as you struggle through language barriers and health scares, power outages and encounters with new and disgusting kinds of bugs. Just remember that once you’re back home in your cozy apartment, eating McDonald’s and watching American Idol, it won’t take long for your soul to start tugging at you, asking for the next challenge, the next entrepreneur to interview, the next flight into the unknown.  Enjoy it while it lasts.

***

I am a Kiva Fellow Alumna, Class of KF6/7, who served three months in Lome, Togo, and three more in Thies, Senegal. I am now working as a Research Assistant at the Financial Access Initiative, sharing research-based insights with the Kiva Community.

By Cynthia McMurry, KF8, Ecuador

Everyday conversations with people in Cuenca provide countless anecdotes of people whose families have been separated by emigration. Everyone seems to have family in the US or Spain, if not a spouse then a brother, sister, cousin or child. At a group meeting last week, a borrower joked that she’d like me to sneak her into the US in my backpack. I asked her and the rest of the group if they had family members in the States, and all ten women nodded their heads in unison.  Recently, I was chatting with a friend whose father is living in New York—she’s my age, and hasn’t seen her father in more than a decade. One of Espoir’s first Kiva clients, Nancy, has a four-year-old daughter who has never met her father, since Nancy’s husband left for Brooklyn when she was still pregnant. Another Espoir client I spoke with has been raising her four young children alone since her husband left for New York two years ago. Now, thanks to the economic crisis, he has lost both of his jobs and remains heavily in debt to a coyote. With no hope of financial support from her husband coming anytime soon, this client has been left to provide for her four children on her own.

Somewhere between 10% and 15% of Ecuadorians live abroad, most in the New York metro area, where they are one of the largest immigrant groups, and in Spain, where they are the second largest immigrant group. As of 2006, nearly 8% of Ecuador’s GDP was comprised of remittances, compared with about 3% for Mexico (International Fund for Agricultural Development).

The high rate of migration has troubling implications for Ecuadorian families. On top of the obvious consequences of emigration, like separated couples and absent fathers, many of the men who leave start new families in the US or Europe and eventually stop sending remittances to their families in Ecuador, leaving their wives to fend for themselves as single mothers. In other cases, men emigrate with their wives or send for their wives later, and children are left with their grandparents or with neighbors. Because many Ecuadorians in the US are there illegally, they have no possibilities to return to visit, and sending for their families would mean paying more exorbitant coyote fees for the dangerous 2500-mile trip. Coyotes typically charge between $12,000 and $14,000 per person. This is about three times the average annual income in Ecuador, the equivalent of $135,000 for a US citizen. And paying this fee doesn’t guarantee that you’ll actually make it into the country: somewhere between 1,000 and 2,000 Ecuadorians are apprehended each year trying to enter the US illegally (Migration Information Source). Many of these people have already sold off their houses, livestock, and any other valuables they may have in their hometowns, just to be sent back home with a new mountain of debt and even fewer possibilities than before.

Pedro, one of Espoir's loan officers, playing with his son

I haven’t asked borrowers whether it’s worth it, but I’m curious. Do the economic opportunities available abroad justify the separation of their families? How are their children affected? If they could go back in time, would they make the same choices?

I’m interested in hearing other fellows’ experiences with emigration and its effects on borrowers’ lives, both positive and negative. Where does microfinance fit into the picture? Are clients using remittances to pay off their loan installments? Or are their small businesses the only means of support they have for their families ever since the remittance payments stopped? For those of you working in the US, have you met any Ecuadorian immigrants looking to take out Kiva loans? If so, is their ultimate goal to save money and return home, or have they established themselves in the US?

To search for currently fundraising Espoir loans on Kiva, click here. No currently fundraising clients? Please check back soon! In the meantime, you can join Espoir’s Kiva Lending Team here.

Cynthia McMurry is a fourth-time Kiva fellow working with brand new Kiva field partner Fundación Espoir in Cuenca, Ecuador. Previously she worked with Fundación AgroCapital in Bolivia and FINCA Peru and Asociación Arariwa in Peru.

Tuesday, July 7 was an amazing day for me because Nela—the Kiva Coordinator of Zene za Zene (ZzZ)–and I traveled far from Gracanica, Bosnia and Herzegovina to meet the last of the 10 entrepreneurs for completing the process of Borrower Verification. I enjoy traveling outside of the small town and especially enjoy meeting all the women who have Kiva loans through ZzZ. Their stories are amazing and I am so glad that I have had a chance to hear them. One in particular was very touching for me because my presence was what brought about the conversation. It turned out that Fatima was born in Skopje, Macedonia, which borders my home-country Bulgaria…and so it went:

Fatima Manjic was born in 1959 in Skopje, Macedonia, but fell in love with a Bosnian man and moved to Kalesija, B&H 25 years ago. During two of the hardest years of the war, her family lived in Croatia and upon their return the family had to start a life from scratch–their house had been burnt to the ground. Not only did the war bring economic difficulties to Fatima, but for 7 years she was not able to go back to her birth-place and tragically both of her parents passed away during that time. She still has a brother and two sisters in Macedonia and she is sad that she rarely sees them. She does not have the means to go visit them because of her business and her two children. Her siblings-in-law died during the war and Fatima shares that living so far from close relatives is very hard. She has nobody here, only her own household.

Fatima’s husband has started working in Azerbaijan, but has not been paid in the past four months, which is worrisome. Currently, Fatima raises chickens and grows cucumbers, which she sells to a company that picks up the produce from her house every other day. She does not complain about working and would do any job to the best of her ability. Not being indebted too long is very important to Fatima and she is happy to have the Kiva credit, without which nothing could be done because of the low wages in Bosnia & Herzegovina. Fatima is thankful and optimistically claims to have all that she needs. She hopes for the best.

I feel recharged and full of energy and optimism. Seeing the hard work that women like Fatima are able to do despite the loneliness and obstacles reminds me of my own struggles as an International College student in the United States. I think I understand Mrs. Manjic on more levels than even I can comprehend.

Fatima in her Well-Kept Cucumber Field

Sve naibolje!

This post has been written by Velizara Passajova, a Kiva Fellow working for 4 weeks in Bosnia and Herzegovina for Zene za Zene International. Check out currently fundraising loans in Eastern Europe and join Kiva Lending Team – Friends of Women for Women International.

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

As I prepare for my placement in September with Fundación Realidad in Mexico City, I’ve been thinking about my local small businesses in NYC.   Here are a few of my thoughts!

By Sloane Berrent, KF8, Philippines

Special Mission should you choose to accept.

The Kiva Fellows Program is looking for a Tagalog-speaking (or Cebuano) person of Filipino descent for a placement at a microfinance institution on the island of Mindanao in the southern Philippines. That means you must be comfortable being placed there and traveling around the region.

Why Tagalog/Cebuano speaking and Filipino?

Kiva abides very closely to the State Department issued warning and there is currently a travel advisory against U.S. citizens traveling to that part of the Philippines.

Reward you say?

That’s right. If you recommend the Kiva Fellows who gets the placement I personally will give you a $25 Kiva gift certificate.

Why? Because I’m here in the Philippines now and I wish I could go down to Mindanao myself. I see microfinance making a real impact here in the Philippines, especially in the provinces outside of Manila, and I believe that Mindanao deserves the same availability to Kiva the rest of the Philippines has access to.

Ok, so more about the Kiva Fellows program? Think you’re qualified?

Join a group of the most dedicated up and comers in the fields on microfinance, community building and economic development you could find.

Spend a minimum of 10 weeks at a placement determined by Kiva. Applications are accepted on a rolling basis (I have heard they are willing to move quickly for the right candidate for this placement but shhh you didn’t hear that from me).

What are you waiting for? Please send this along to anyone you think is a qualified candidate. Have them refer you in their application and if chosen, I’ll be giving you a $25 Kiva gift certificate to loan to any Borrower you want!

Interested in helping with this incentive? Match me and let’s make this “reward” higher ($50, $100 +!) Just say so in the comments and include your email address and I’ll keep you in the loop about who our deserving winner is!

A little linkage for more information:

More about Kiva Fellow requirements can be found here.

Meet the Kiva Fellows

FAQ’s

Kiva Fellows Blog

Sloane Berrent, KF8, is currently serving her placement with Ahon sa Hirap (ASHI) in the Philippines. Spending time with ASHI members she has learned to throw pots, plant rice and helped man a general store and is planning to spend a day with more members to walk in their shoes. When online, you can find her promoting Kiva on Twitter and writing about social action campaigns on her blog, The Causemopolitan.

Posted by Lee Bruner KF8

In Cusco, Perú, there are numerous holidays during the winter months of June and July. Most recently the town celebrated Inti Raymi (the Sun Festival), an Incan tradition marking the beginning of a new year with the winter soltice. Many  companies make up their own traditional outfits and march through the main square in a parade that lasts for around 12 hours.

I am currently working with Asociación Arariwa, Kiva’s field partner in the Sacred Valley of Perú. When I arrived last month, preparations for Inti Raymi were already underway: signs were posted around the office detailing the dress code (dark pants and red pocho) and practice times for the dancers who would lead our group through the plaza.

We met up at the office for the parade at 5 pm. I had some difficulty finding a pocho big enough for a 6’5 (195 cm) guy. With the help of three colleagues, we undid the hemming of one, and then stitched up the sides for just the right fit. We were group #149 out of 300 lined up on Avenida del Sol, slowly heading to the Plaza de Armas while music was blaring and fireworks were exploding overhead.

Lee Bruner KF8 with Asociación Arariwa Colleagues

I wish I had actual footage of the dancing, but I was too busy trying to follow along with some improvised dance steps that a loan officer was teaching us moments before our debut. I was literally dancing (or attempting to, I should say) in front of thousands of people and camera crews through the main square – no joke! Despite the slight humiliation, it was a blast, and quite an introduction to Cusco!

Arariwa has been an excellent host since I arrived last month. Right now they are transitioning from a Pilot to Active Partner with Kiva so that their monthly fundraising limit can be increased. As a Kiva Fellows, thisentails doing borrower verifications, as well as looking for ways to integrate Kiva with their internal computer software and loan disbursement process.

This week I’ll be traveling to Pilcopata, a town in one of the most remote regions that Arariwa serves. Loan officers regularly travel up to 4-5 hours away from the Cusco headquarters to meet with communal banks, reaching entrepreneurs who might not otherwise have access to capital. Loan officers have also recently received training to begin a financial literacy program to teach clients about planning for repayments as well different savings methods.

I’m looking forward to seeing Arariwa’s work in more rural areas. And word has it that we’ll be passing through Paucartambo to catch a glimpse of the famous Virgen del Carmen Festival!

If you’re interested in funding loans for Asociación Arariwa, click here. Please also consider joining our Lending Team!

By Megan Tatman Montgomery, KF8 Costa Rica

Microfinance involves a tremendous amount of legwork.  While Kiva is all about facilitating connections between borrowers and lenders, it’s important to recognize the hard work of those in the field that make sure your money gets to microentrepreneurs that need it the most.  Here is a brief glimpse into EDESA, Kiva’s field partner in Costa Rica, with a little more about how the organization works and the people that are working hard to alleviate poverty in Costa Rica.

If you’d like to learn more about microfinance in Costa Rica, join the EDESA lending team, Pura Vida Costa Rica.  Also, be sure to visit this link regularly to see any currently fundraising loans for Costa Rican microentrepreneurs.

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Megan Tatman Montgomery is wrapping up her fourth and, sadly, final placement as a Kiva Fellow.  Prior to EDESA, she served at Friendship Bridge and FAPE in Guatemala and ADEPHCA in Nicaragua.  Feel free to email her at megan.montgomery@fellows.kiva.org with any questions, comments, or requests for future blog posts.

View of Cotonou Benin

Over the past two weeks, I’ve spent a fair amount of time at Alidé’s field offices.  These offices are where the heavy lifting of Alidé’s work gets done.  I often walk into an office to find fifty women waiting to be interviewed for a loan.  Each office has about two or three loan officers, so, as you can imagine, these interviews are very time consuming.  Interviews can easily last all day.  Nonetheless, the loan officers patiently sit down with each person until the work is done.

I am quite impressed by the loan officers’ dedication to Alidé.  I think that they have the most difficult and time-consuming job of the entire operation.  While the whole city of Cotonou takes a two-hour siesta during lunch, they often do not have this option. With so much to accomplish, they can easily work well into the evening.  Not only do they have to conduct interviews, they are also responsible for communication and follow-up with Alidé borrowers.  For one, this involves conducting training sessions on Alidé’s policies.  I can only imagine the difficulty of explaining finance to a group of borrowers who do not have a formal education or any previous experience with loans.  Loan officers also have to make sure that borrowers actually pay each month, which can require a special visit to those who are delinquent on their payments.  It is obvious that this work takes a lot of patience and hard work.

In the midst of this bustle am I.  In order to better understand Alidé’s work and to conduct interviews, I need to go into the field.  I have to work with the loan officers because they know the clients best and they can translate French into Fon, the local language.  They help explain to the borrowers the reason for my visit.  Such a link is crucial in a place where I am clearly an outsider.  Understandably, I often have to wait until the loan officers have a chance to fit me into their schedules.

An experience yesterday with a loan officer really stood out to me.  I was out in the field conducting borrower visits, with a loan officer named Gildas.  We finished enough for that day and he told me that we had a few errands to run before returning to the office.  We rode around the city, occasionally stopping to speak to someone.  After a few stops, I asked what they were discussing.  Gildas told me that he was reminding them of a meeting set to occur the next day.  The subject of the meeting would be Malaria Prevention.  Meetings such as these, he told me, were some of the social services that Alidé provides.  Gildas and I went around the city to make personal visits to at least fifteen people.

To me, this is remarkable. These guys are so busy and yet they are still enthusiastically offering these services.  It makes me really respect the work that they are doing and grateful for the time I have with them.  Alidé obviously has a lot to do and yet it still makes time to go beyond its normal call of duty. Although a financial institution, its mission is much broader than just making money. One of my colleagues is working on a plan to provide micro health insurance to borrowers.  On top of the health campaign, Alidé gives small interest-free loans to people who want to start business activities.

Alidé understands something important:  to have a well-functioning society, people need basic services like health care, education, and access to a little cash.  Everything is interconnected.  Alidé’s efforts may be small in the grand scheme of things, but I think they have the right idea.  The staff is very committed to the mission.  I give them a lot of credit.

Andrew Whiteman is a Kiva Fellow (KF8) currently working in Benin.

By Alison Carlman, KF8 – Kenya

As a graduate student of International Development at an African university, I wish that the answer was as simple as finding the “one thing” to alleviate poverty.  For marketing purposes, NGOs and “experts” tell us that the answer is so simple, whether it’s access to clean water, economic liberalization, universal healthcare, education, modernization, or microfinance. But 50 years of “Development” in practice teaches us that it’s not so black and white.

Kiva will be the first to tell you: microfinance is not the solution to poverty.  Provision of financial services is simply an important part of helping people improve their lives; microfinance is only a “tool” that can help people to meet a portion of their basic physical, social, psychological, and spiritual needs.

Alison at K-MET with Deborah, the Coordinator of the Food Security Program.

I’m working with Kisumu Medical & Education Trust (K-MET), a reproductive health organization in Kenya.  One of the many services that K-MET provides is reproductive health education and life-skills training to at-risk young girls ages 10-24.  These girls are often young mothers, survivors of rape and unsafe abortion, children of polygamous families, girls who had to drop out of school and work as prostitutes in order to meet theirs and their families’ basic needs.

A loan alone won’t solve these girls’ problems; they need counseling, support, marketable skills, food, daycare, education, encouragement, mentorship…. the list goes on.

K-MET's Sisterhood For Change trainees practicing their hairdressing skills

K-MET works to empower these girls with information about their health and their rights; they are trained as peer educators to share the information with their family and friends. The girls go through an extensive 6-month training that includes drama, sports and poetry to explore these issues.  But K-MET found that the information just wasn’t enough.  They saw that the girls were still dependent on men for income, and therefore still vulnerable to early pregnancies and HIV. So K-MET added extensive vocational training to the curriculum; the girls each learn marketable skills (hairdressing, tailoring, catering) so that they could earn their own incomes.

Unfortunately, after 60 girls graduated from the intensive K-MET program, only 12 girls were able to find jobs or to start their own businesses to meet their own needs.  So back to the drawing board – K-MET began Safe Space, a “phase 2” launching space for graduates to develop their business skills together using K-MET space and equipment, allowing them to save up their own income and move out on their own when they’re ready.  A “pilot program” has been started with 12 graduates to help launch them into their own private businesses, which we *HOPE* will begin with Kiva loans in the near future.

Participants of the Safe Space Entreprenurial Training

But the girls have to be ready to run their own businesses. The microfinance textbook tells you that to get a micro-loan you must have economic opportunity.  These girls were trained in entrepreneurial skills – they wrote business plans and marketing strategies.  They even have significant income-generating abilities (in catering, hairdressing, and tailoring).  But they are trying to operate their businesses in a slum – business is slow-going, and motivation is lacking.

Milena, the Kiva Fellow who helped launch the Safe Space before me, described her angst with getting the girls off the ground: “I would smile. I would pump my fists in excitement. I would lure them with cookies. Still, they seemed disinterested.”  Milena made a phenomenal effort, and I’m now here to continue what she helped to begin – if I can figure out how. “Ok – hairdressing department, if you have three days where you meet your sales targets in a row, you can give me mzungu (white person) braids.”

On the books, the girls are ready. They are empowered. They have information. They have support. They have mentors and they have skills. But I wonder – will they make it? Will they leave the K-MET nest and go out on their own to successful businesses where they can support their families?

What other things need to happen in Kisumu and Kenya to provide the right economic, political, and public health environments to enable their success?  Joel, (my husband, also a Kiva Fellow) and I often speak of the opposing “poverty” and “prosperity” poles that each of us are tied to because of where we are born.  He and I, only by chance, are fortunate to be tied to the “prosperity” pole that includes safety nets of insurance, education, and health.   But how do things like the men’s view of women in Kisumu keep these girls tied to a pole of poverty, despite whatever steps they make in a positive direction?

Development is not a one-sided issue. There is no “silver bullet” to fight poverty. I stand behind the belief that microfinance is an important, powerful tool for development.  But, as Kiva lenders, may we not give up the other valiant fights that we each believe in when it comes to equality, sanitation, democracy, education and public health – and the many other pieces to the picture that is ‘Development’.

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Alison Carlman is in her 4th week as a KF8 Kiva Fellow in Kisumu, Kenya with K-MET.  Join the K-MET lending team here, or see if K-MET has any fundraising loans posted!  Alison is also an MPhil student at Stellenbosch University studying Community and Development.  She is not totally excited about getting “mzungu braids” – but… whatever it takes…

By Cameron Morris KF8, Mozambique

In San Francisco waking up on a Saturday morning and hitting the Noe Valley farmers market is always a good time. Organic, sustainably grown, local produce , grass-fed, free range meat, 30 something couples playing with their toddlers and quaint discussions with local farmers are just a few of the delights. I’ve got a particular soft spot for the ever-popular heirloom tomatoes, I even went so far as to cultivate my own last year.

How does the image I’m painting relate to the market I visit every day in Boane, Mozambique? While there obviously aren’t three year olds sporting Obama tees in the Boane market part of me always assumed that the products being peddled in such markets were being sold by someone just a few deviations away from the local farmer. My dream was recently crushed when a co-worker told me that a lot of the agricultural products found in the market were imported from South Africa. While Mozambique isn’t entirely dependent upon food imports from South Africa they do get a lot of their food from their neighbor and certainly have deficiencies with local agricultural production.

When founded way back in 1995, the predecessor to my MFI set out to stimulate agricultural growth in post-civil war Southern Mozambique through microfinance. Fast forward fourteen years and what are we seeing? Decidedly bad results. Local farmers can’t compete with subsidized South African agriculture, they can’t purchase costly capital equipment, some of the arable land here is riddled with remnant landmines, and there is a lot of inherent risk involved in going into agriculture. My MFI is aware of these issues and has started taking action to address them.

The Community Tractor

One of the coolest things that they’re doing is something I call the “community tractor”. They own a tractor that they lease out to local farmers. This obviously cuts down on capital costs for these farmers and also leaves the maintenance to the MFI. It’s almost like City CarShare for tractors. While I’m sure this isn’t a novel idea, it’s still pretty cool. We’ve also got Daniel Machava on the payroll, a native Mozambican who studied agronomy in Cuba for 4 years, and more agricultural focused products being developed by an external partner. Possibly indexed weather insurance? Who knows? The sky is the limit, the deft touch of ingenuity will eventually get the African Green Revolution going and build the beautiful bridge between the Noe Valley farmers market and the Boane mercado principal.

Cameron Morris is a member of KF8 currently working with Hluvuku-Adsema in Mozambique. At this point he can say about three sentences in Ronga and is completely comfortable with the local Portuguese  dialect.

Be one of the first people to join the new Hluvuku-Adsema lending team.

By Courtney Kemps, KF8 Peru

Last week I spoke with Patricia Isidro, supervisor of the loan officers in Manuela Ramos’s Pucallpa office, about a wave of pyramid schemes which seriously affected many of the institution’s borrowers in the Pucallpa area over the past year.  This “pyramid game” (juego de la pirámide), as it is known here, can take several different forms, but most commonly each person recruits two others to contribute 300 soles (about $100).  These two each recruit two more, and so on down the line.  The money is transferred up the pyramid to the person at the top, who walks away with 2400 soles.  The people immediately below this person then move up to the top spot.  Once the chain of money transfer breaks and the scheme collapses, however, everyone in the lower tiers ends up losing.

Patricia Isidro at her desk

It is not clear who brought the pyramid game to Pucallpa (other areas where Manuela Ramos operates did not appear to be affected), but this series of schemes impacted many area residents, not just those receiving loans.  With respect to Manuela Ramos, Patricia estimated that such schemes affected 80 to 90% of the institution’s Pucallpa-area borrowers between November and March!  The majority of these women lost their capital for investment in their businesses and ended up unable to make their monthly loan payments on time.  In the hopes of making some quick, easy money, the poorest borrowers were the worst off as many had not only given up their investment capital, but also many of their household items in order to play the game.

Dolly, a Kiva borrower, spoke openly with me about the pyramid game and how her involvement in it this winter created great difficulties for her family in subsequent months.  Dolly is a 42-year-old single mother and has been working with Manuela Ramos for four years.  She runs a small food stand in the early mornings, selling cakes, breakfast sandwiches and juices out of her home.  When Dolly first played the game in January at the invitation of a friend, she “won” a few hundred dollars.  Encouraged by this, Dolly lent out her winnings to others so they could play the game and also invited several more people to join.  As it turned out, the people Dolly invited did not receive any winnings and soon began knocking on her door, asking for the return of the 300 soles they had invested.  Dolly had passed their money on up the pyramid and had nothing to give them.  Additionally, no one to whom she had lent money to play the game ever paid her back.  Embarrassed by the fact that her invitees constantly came by to ask for the return of their money, Dolly retreated into her home and stopped working.  She struggled to pay back all her loans and still maintain enough to feed her family.  Not only did she have credit from Manuela Ramos, but also from another microfinance institution and a commercial bank.  Soon the other microfinance institution took her refrigerator as payment of her debt and the commercial bank came knocking at her door, threatening to seize her house.  For four months Dolly struggled in this situation.  At this time she is back on her feet, working extra hard at her restaurant.  She no longer has outstanding debt with the other microfinance institution, is working with a small loan of 500 soles (about $165) from Manuela Ramos, and is slowly paying back the commercial bank and her invitees who each lost 300 soles in the pyramid game.  Dolly described this game as a “plague” or a “fever” that took over Pucallpa for a good part of this past year.  Life isn’t easy for Dolly right now, but she feels better and is successfully managing her household and business.

Although recruitment into such schemes appears to have ended for the time being, both Manuela Ramos staff and borrowers will continue to feel the ripple effects for some time.  Loan officers have had to work extra hard in recent months to track down borrowers who have gotten seriously behind in their loan payments.  Such tasks are very time consuming for Manuela Ramos’s loan officers, who already have more than enough work managing their high load of communal banks.  Additionally, due to Manuela Ramos’s communal bank system, both those borrowers who became involved in the pyramid game and many who did not will be affected by the capital losses for many months to come:  If one borrower defaults on her loan, all of her fellow communal bank members must wait until she pays or puts something up as a guarantee in order to receive their next loan.  Lack of payment also means that interest rates go up for the group as a whole.  For an individual borrower, getting behind on payments (even by just a few days) means that her loan size will stay the same or even shrink during the next cycle.  All of these consequences of non-payment or late payment mean that many Manuela Ramos borrowers will face a greater challenge in growing their businesses for months to come.

Susceptibility to pyramid schemes like the one described above, and vulnerability to their negative consequences, are, I think, often greater for poor, hardworking people to whom a few hundred dollars means a whole lot.  Many microloan recipients fall into this category.  If you’d like to learn more about Manuela Ramos’s microfinance program, click Here.

Last week I had a moment when the confusion of globalization washed over me…

I got into one of Kigali’s tiny city buses, officially called matatus, but affectionately known as a “one-more” because one more person can always be squeezed into the already sardine-packed vehicle. (The size of a Toyota Previa, seats 18). These buses are scrawled in Mandarin script— they were likely hand-me-downs from one of China’s cities after realizing that they were no longer safe enough to transport people by China’s standards. Most of these buses have some other art added— usually hand-drawn paintings of Barack Obama, Canadian flags, Arabic calligraphy, or Bob Marley. I hop in and instantly notice that the interior is decorated floor to ceiling with Manchester United stickers. The radio in the bus is playing in a familiar mélange of French (the colonial language of Rwanda) and Kinyarwanda (the indigenous language of Rwanda.) I learn that we are listening to an international friendly football match with Egypt. From my bag, I take out the material I am currently reading, Agamemmnon, from a book of a collection of classic Greek plays. As it happens, I am on my way to an North African-fusion pizza restaurant. Of course, I know I am in Rwanda… but… wait… am I?

Globalization can really confuse a girl…

The fact that I am even here—a Canadian of European heritage—sitting in this very bus, itself already an object of globalization, tells me that the world is colliding with itself.

Although the globalization of commerce and culture has long been something of interest to me, being quite literally on the opposite side of the globe has brought to light again the incredible and unstoppable force of globalization. A devoted consumer of many things that could never grow in my own country— coffee, mangoes, coconut, the list goes on— it has been fascinating to be in the place where my money goes when I purchase those products. It’s amazing to think that my $2.75 in Canada ripples over here to Rwanda and ultimately funds Joe Schmoe or Jane Doe in my own neighbourhood of Kigali.

The coffee I choose to buy could fund a multinational with no quality standards and poor treatment of workers, or it could fund a small micro-lot farm, run by coffee-quality gurus, roasted by passionate experts, and ultimately sold in a locally-owned coffee house committed to its trade. Both are equally commercial, and each has its upsides and downsides, but in this century the difference is that I have the ability to witness the effects of my transactions.

I am a firm believer that we are not just members of our own municipal, provincial and national society, but that more and more, our community is global. Everything we buy, say, do in our own country has a whiplash effect on our neighbours: Europe, Africa, Asia, the ocean, the rainforest… everywhere. In this generation, there are no longer isolated economic or political events.

This is preaching to the choir for most Kivans… Kiva lenders have long understood that their economic activities in the West will ripple across the Pacific, Atlantic, Arctic, and Indian oceans and wave up on someone else’s shore. They have chosen to embrace this fact and expedite the process via the internet and actually finance businesses in the developing world. Cross-cultural lending is just one expression of our community and economy that is ever becoming more global.

I would like to challenge all of us to let our transactions reflect the world we wish to see. As I mentioned in my previous blog about peace in Rwanda, I truly believe that microfinance is an actor in perpetuating peace on Earth. What do you value? If use our money with love, we will spread love. If we buy carelessly, there will be careless effects on the world, and often the most vulnerable. (OK, now I’m really starting to sound hippy-dippy). I am encouraged as I witness the Kiva project in action, as I know that every borrower I meet in Rwanda was funded by largely a “developed world” set of investors. I am encouraged that so many people are choosing to let the global impact of their transactions be a good one! Let’s continue to have an impact for good on this truly global community of ours.

If you haven’t already made a loan, please help finance an entrepreneur in the developing world.

I am Laura Buhler, Kiva Fellow serving at Vision Finance Company in Kigali, Rwanda. Please check out the Kiva website and make a loan!

I think most of the other fellows will agree – the best (and the most rewarding, most inspiring and sometimes, the most awkward) part of this fellowship is going out into the field to meet the borrowers. Though each of my field experiences has been unique, there are a few things I have come to expect.

I’ve traveled up to the mountains, down to the valley and along the coast to meet borrowers. The scenery at each place has been drastically different: the northern Bekaa valley is flat and somewhat arid; Mount Lebanon – lush and green; and the Southern coast – flaxen and dotted with palms. Regardless of where I’m headed, the day always starts off with a near-death experience involving a scooter, car, truck or, when really lucky, a semi (nothing like having your life flashing before your eyes to give you that extra jolt of energy in the morning).

After surviving the car-ride to one of Al Majmoua’s branches (Al Majmoua has nine branches located all over the country), I meet the Loan Analyst (LA) I will be trailing for the day. The LA serves as my guide, translator (for when I struggle with the language) and general hero in life. Each LA has over one hundred clients and knows everything about them from how their businesses are going, to the number of kids they have, to what repairs they need done on their houses. From there, we start our rounds – visiting the borrowers.

The Lebanese people are known for their hospitality (and 4 pounds in one month later, I can vouch for it). Regardless of where I am meeting the borrowers (their homes, grocery stores, workshops..) I am always offered at least one strong cup of Arabic coffee. Declining is almost never an option. After accepting the cup (and I don’t drink coffee) the fun really starts. I ask my questions in Arabic: How long have you had your business? What hardships do you face? What are your dreams …and finally, the dreaded: How did the loan change your life? I dread this question because I always butcher this phrase at least twice while on the field. Loan is qard in Arabic; qird is monkey in Arabic- you can guess which word I tend to use. The general consensus is: Many clients have not seen the monkey funded by Kiva but they find the loan to be very helpful. This is where the Loan Analysts (my heroes!) jump in and explain to the confused clients what I was trying to say.

Despite all the awkwardness and confusion that my garbled Arabic generates, these field visits are what bring everything together: I meet the nineteen year old boy who single-handedly supports his family of five by giving little kids rides on the pier on a mini-train attached to his motorcycle (the only business of the like in the area), the store-owner who is working tirelessly to put his four kids through college, the woman selling clothes out of her war destroyed home that she one day hopes fix. I meet people who are determined despite set-backs and generous despite their financial situations. At the end of the day, I am a sweaty, jittery mess desperately seeking the bathroom courtesy of the 5th cup of coffee – and I love it.

Alia Rafeh is a Kiva Fellow who is working with Al Majmoua in Lebanon this summer. To lend to Al Majmoua’s clients on Kiva click here: Al Majmoua currently funding loans.

By Nilima Achwal, KF8 Bolivia

On my second day in La Paz, I braved the high altitude and made my way to Calle Sagarnaga, the main tourist shopping street. As I trudged up the slippery cobbled street, a skinny middle-aged man carrying a folder easily kept pace beside me and urged me to take a look at his paintings. Since I only needed an excuse to stop climbing, I stopped, and the man started sifting through painting after painting of indigenous women wearing a myriad of hats and shawls and pointing out the corresponding figures on the street. I soon learned that his name was Jorge and he wanted to give me an introductory course on indigenous Bolivian dress. “See that woman there?” He asked excitedly, “She’s single. You can tell by the color of her shawl. She’s also originally from Cochabamba, not La Paz. ” In a span of five minutes, the vendor had given me a proud summary of the dress and customs of some indigenous groups of three different Bolivian cities.

Then came the question that  I dreaded: “Where are you from?” Ever since I arrived in La Paz, I have been inundated by anti-American rhetoric, like the highway barriers that read “Yankees Go Home; El Alto Se Respeta [expletive]” (El Alto respects itself) repeatedly over the several kilometer stretch of road that passes right in front of the AgroCapital office, in the suburb of El Alto. The American ambassador in Bolivia was kicked out just last fall. In addition, I fully expected the price of his paintings to miraculously increase three-fold as soon as I answered that question. But taken in by this man’s sincere interest, I answered quietly, “Los Estados Unidos.”

Then came: “Are you just travelling or are you here for social work?”

“Social work,” I answered.

Jorge flashed me a toothless grin and looked me in the eye. “Gracias.”

It touched me that a stranger to whom I had nothing to offer was grateful for my work. In turn, I asked him about his work. He has painted his entire life. “Lo hago por cariño,” he explained—I do it out of love. Love for his people, his culture, and his country. His intense appreciation of the beauty of his heritage carries him through day after day of hard work and absolute economic uncertainty.

I decide to buy a small, colorful painting, and he charges me 15 bolivianos, or slightly more than two dollars. After assuring me that he has change, I hand him a 100 boliviano bill (14 dollars), or more than even the average-income Bolivian makes in an entire day of work. Before I realize what is happening, he tells me to wait one moment with his folder, and he has disappeared down the steep, crowded street to go get change.

I mentally kick myself. I only blame myself for letting him run away with my bill. My logical mind tells me not to waste my time and to give those fourteen dollars up for lost. But something keeps me rooted to my spot. He told me to watch his paintings. I have a responsibility to wait for him and make sure nothing happens to his work.

I wait. Three minutes, five minutes. I feel like an idiot; a lost-looking foreigner just standing on the side of a crowded street. By the time ten minutes pass, I am ready to shed my idealism and leave.

Jorge, in his bright red shirt, comes striding up the hill, pushing through tourists and vendors, eighty-five bolivianos in hand. He happily scurries up and hands me enough money to pay for eighty-five bus rides within the city of La Paz.

It’s the pride he takes in his work that inspires and energizes me. It’s the respect for other human beings (and their money) that this pride demands of him. This is not an isolated incident; I’ve seen this deep pride in many vendors and Kiva entrepreneurs in Bolivia. It’s rare for anyone to change her prices much in La Paz—the product is worth what it’s worth. Similarly, the value of her work is non-negotiable.

I feel safer and more comfortable here than I have in any other developing country, and it’s because, as a loan officer explained to me once, “Bolivians think you’re the same as them.”

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Every day, headlines decry the Yankees that want to buy Bolivia’s natural resources, that use their economic power as a political tool, that ostensibly instigate rebellious political groups. Get them OUT, demand The People. We hate Americans. And every day, I am treated graciously, thanked for my work, respected, and taken in like an old friend.

Where is the line between individual and entity? A shared moment of trust between two strangers from different lands can be far more powerful than the suspicion between governments and nations. It’s only at the individual level that we can toss out generalizations and recognize our common humanity. Kiva is about creating connections between individuals; it’s about creating thousands of mini-moments of trust, even love, between two people very far away in every regard. It’s about my trusting Jorge to bring back my eighty-five bolivianos, and his knowing that I value the work that he has created. And the individual level is exactly where we must start now, when our governments and economies are more inter-connected than ever before.

It’s not possible to for us to toss out all of our age-old feuds, hatreds, and resentments towards other communities and countries. All I’m asking is that we each just share a moment with another individual that we may have no reason to trust.

Anti-American graffiti in front of AgroCapital office

Nilima Achwal is a Kiva Fellow who is working with several branches of Fundación AgroCapital and their clients in Bolivia this summer. Lend to an AgroCapital entrepreneur now!

Hello from Indonesia! I am in my first week of my fellowship and wanted to make my presence known on the fellows blog. My name is Cissy and I will be working with Tanaoba Lais Manekat (TLM) in West Timor for the next 12 weeks. Unlike other fellows, I had the opportunity to work as an intern in the Kiva office in San Francisco for 5 months before my fellowship. I worked on the logistical side of the Kiva Fellows Program under JD and Zack. Like the idea behind Kiva, the actual office is a pretty awesome place. It has a warm atmosphere with lots of inviting couches and friendly people. The staff is a tight knit family committed to the mission of Kiva – to connect people through lending for the sake of alleviating poverty. They work hard to keep Kiva running smoothly and keep users, like you, engaged.

Ever wonder what goes on at the Kiva office? Well, here is an inside look! I made a little video highlighting my transition from intern to fellow. This video is a tribute to the wonderful Kiva staff who I miss dearly…

Cissy DeLuca is serving as a Kiva Fellow with Tanaoba Lais Manekat (TLM) in Kupang, West Timor, Indonesia. TLM is a new partner that joined Kiva in January and is still in pilot phase. You can view their Kiva loans here!

By Sloane Berrent, KF8, Philippines

“Tell Ma’am Sloane about your recent project.” Sir Rexon asks Sir Ronnie while we sit having lunch on Talim Island in Binangon, Rizal, where I am visiting an ASHI branch for the day. Everyone here goes by Ma’am and Sir as a sign of respect.

This island, is the 12th and final stop on the small transporter boat from Morong, and one of ASHI’s strongest branches and most remote. No cars are on the island, only tricycles (motorcycles with sidecars) and the main thoroughfare’s fences in front of the houses are painted with a scene of a garden that stretches the equivalent of 3 city blocks. The rest of the world feels far, far away.

I think the project is going to have something to do with this branch, I’ve heard all about how this branch gets books donated to the schools and how ASHI has a strong social development program to help the ASHI members learn financial literacy, good parenting, how to strengthen their community.

I’m wrong. It turns out Sir Ronnie saw on the news last year a story about 10 children on a small island called Magalundi Island about 100 meters from Ilio-Ilio City on the Panay Island.

These 10 children were reported as swimming to their elementary school, Binon-An Elementary School, in the morning and home in the afternoon because there wasn’t a canoe or boat to transport them and no school in their island.

There is a commercial boat, but the hours start after they have to be at school and end before they are finished for the day.

“But what about their books? Their uniforms?” I ask incredulously.

Sir Ronnie tells me they put their books and uniforms in plastic bags and buried them in the sand every day. “They couldn’t do their homework at night,” he tells me, that is the one thing that stood out most to him.

“Once,” he says, “a storm was coming in and one of the girls was responsible for her little brother when they swam. He was too little to do the whole distance himself and so would hold onto her neck and shoulders. The storm moved in fast, and unfortunately she lost him.”

“So what you’re telling me,” my hands gripping tightly to the table and my appetite gone, “Is that there are children who swam to school because their family believed that much in education. And that they buried their belongings in the SAND day in and day out and one day while swimming the 100 meters one-way, that they swam twice every day, a storm rolled in and one of the boys died?”

“Yes. That is why it made the news.”

“Wow.” I pause mainly because no words seem to be able to escape my mouth with my jaw hung open so low. Finally I muster, “So what is the project?”

Talim Island Branch of ASHI, hundreds of miles away, under the leadership of the Branch Manager Ronnie, decided to raise the money to buy these kids a boat to take them to school.

The cost? 2,000 PHP (American dollar to Philippines pesos is 1:48 so about $42).

The time? 3 months. It took two months to raise the money and both ASHI staff from around the country AND borrowers pitched in. One month to have the boat built and then Rexon and Ronni drove it across Panay to a inaugural ceremony on the beach to give it to the families.

There was not a dry tear in the house. When they presented the boat this past May, the families cried and the teachers cried and the ASHI staff who delivered it cried.

“But,” I say after many moments of blinking back my own tears, “ASHI doesn’t even operate in Ilio-Ilio, and there are so many other natural disasters I’ve heard of like typhoons and flooding and the lean months. Why this project?”

Ronnie looks at me, slowly smiles and says, “Everyone should have the opportunity to go to school. And God tells us to help those less fortunate than us. When I saw the story on the news, I knew we had to help.”

Meeting Borrowers here, one of the questions we ask them is, “What are your hopes and dreams for the future.” Almost unanimously they respond that their dream is to be able to send their kids to school and college. Fees for book, required uniforms and tuition can be hard for a family in poverty with many children.

Here in the Philippines I’ve found time and time again, even those with little look to help those with less. That is the human spirit, that is humanity and it’s seeping here. Seeping through the boat, up the dirt path, around the corner with the kids playing hopscotch and the mothers doing laundry in the alleys and the men pulling in the morning’s catch of fish. It’s seeping all the way to the table where I sit, looking at a man who would not stand for kids to have to swim in dangerous water just to go to school.

Sloane Berrent, KF8, is currently serving her placement with Ahon sa Hirap (ASHI) in the Philippines. Spending time with ASHI members she has learned to throw pots, plant rice and helped man a general store and is planning to spend a day with more members to walk in their shoes. When online, you can find her promoting Kiva on Twitter and writing about social action campaigns on her blog, The Causemopolitan.

by Michael Kasseris

There wasn’t much wind blowing through Hanoi that morning. The air was heavy and humid, like every step I took was like walking through a pool of water. It was my first morning in Hanoi and I needed to cross the street my hotel was on to hail a taxi. As I stepped closer to the edge of the sidewalk I noticed how fast the air was moving across my face. A swarm of motorbikes, taxis and trucks racing through the street swept the air past me and blew a cloud of dust in my eyes. Before I knew it my chances of crossing the street were over and the violent current of traffic seemed to have no end, or so I thought. Next to me an old lady balancing two enormous piles of fresh pineapples and lychees across her shoulders just stepped down onto the street and without looking up, miraculously reached the other side. I was amazed that she came out alive, how did she not get hit by any of the vehicles? As I waited for a break in the traffic, another woman walking with her child stepped down onto the street in front of me and in what seemed like a suicide attempt, made it through alive on the other side of the street. I was baffled. There was no way I was going to be able to cross here. As the taxis on the other side began to lose patience they drove off looking for another customer. I was going to be late. I walked up and down the street as if I was going to discover some invisible bridge to take me to the other side, yet there was no break in the death race in front of me.

...one of the reckless motobike drivers

Then as I began to lose hope, a tall man with what sounded like an Australian accent looked at me and laughed. He also stepped down and started walking through the traffic that raced past him like a swarm of bees, but before he made it halfway across he looked back and yelled at me “You just go!” You just go? Was he crazy? I didn’t know if the locals used some secret hand gesture to cross the street or knew of some unspoken pattern in the traffic but surely I couldn’t “just go.” Or maybe I could? With my eyes half closed and my limbs as close to the center of my body, I gingerly stepped down into the street. I didn’t bother looking at the traffic coming straight for me but instead looked forward at the other side of the street and kept walking. When I stepped back up onto the other side of the sidewalk I couldn’t help but think of those safari programs on TV that follow that lone zebra as it tries to cross the crocodile infested waters. After I finished counting for all my toes, I realized that it took a leap of faith to get me across the street and that I didn’t need to be worried. I just needed to go. Sometimes things in a new place may not seem as organized and as sterile as one might be used to in their normal environment. That’s something I have been reminding myself this past week in Hanoi and as I get situated at my MFI, that some things just take a leap of faith. It was a leap of faith which made me leave my “great” job back home in finance and board a plane to Hanoi. It was the same leap of faith which some of the first micro lenders had when they decided to support some women in poverty start a business. It was a leap of faith which brought these new entrepreneurs to believe that they too could be successful business owners in a developing economy. I will be working with SEDA , which stands for Center of Small Enterprise Development Assistance and is a part of Binh Minh a larger NGO here in Vietnam focused on Microfinance. The staff here has been extremely hospitable and I have already made friends with some of them. They particularly like bringing me to lunch in a group and see what food I will be too scared to eat which I am proud to say has never happened, even lunch can sometimes be a leap of faith.

Michael Kasseris will be working with SEDA in Vietnam this summer for 12 weeks. If you would like to learn more about SEDA or lend to one of their borrowers click here.

by Rob Mittelman, KF8 Peru

A Kiva Fellow has many jobs. I have well over a dozen different tasks on my workplan.

Some of them bring us great joy and inspiration like interviewing Kiva Borrowers and getting to know new cultures and new people.

Some let us be creative like this blog and all the Flip Camera videos you see.

Some make us feel like management consultants or professors preparing PowerPoint decks and going through trainings with our MFIs on new Kiva policies or web tools.

We write about these experiences because of how fun it is to be a Kiva Fellow and how lucky we are to do these things (not blowing smoke here, it really is cool, check it out for yourself). However, one of the more unpleasant but important jobs we have is borrower verification.

Borrower verification is making sure that what you see on the website is what is really happening in the field.  It’s all a part of Kiva’s commitment to transparency. It is checking that the entrepreneur you are supporting is actually receiving the correct amount of funds and for the purposes listed on their profile page. I think for the overwhelmingly vast majority of cases, there’s a match. However, sometimes there isn’t that match and we need to investigate. It can highlight the existence of fraud, misunderstandings of Kiva policies, or just good faith mistakes.

Kiva, as a web based organization, is based on trust.  Kiva lenders loan their funds at 0% interest, with the possibility of loss and, deservedly, want to know that their loans reach the intended beneficiary. This is Kiva’s promise. But, this is the Internet after all. There have been (and will continue to be) some less than honest emails, web pages, and businesses online.

Kiva builds its brand name based on the transparency and integrity of the information on the website. Without this transparency, our beloved Kiva model won’t work.

What happens? We’re basically checking for three things – 1) Borrower knowledge that their photo and information is on the Internet, 2) That the amount of their loan on Kiva coincides with what they received from their MFI, and 3) That the picture, story and loan purpose listed on their profile page is an accurate representation of the borrower’s reality at the time.

Does what's on the website equal what's on the ground?

It is an unpleasant job because when you find something that doesn’t match, it’s disheartening. The first thing that crossed my mind was the F-word. In this case, the F-word is Fraud (hey, this a PG rated blog, get your minds out the gutter).  But, that’s a big leap so we systematically check it out. There are a lot of temptations that can come along with a 0% interest loan from an organization half a world or more away and individual financiers scattered around the globe.  There are also more than a few misunderstandings that can go along with implementing new technologies at an MFI or having to explain the Internet, in a foreign language, to a 70 year old woman who lives with no electricity (let alone a laptop with WiFi).

Kiva is working hard to make sure this kind of thing doesn’t happen.  But if it does, that we catch it, investigate it, and take appropriate steps (That’s right, I said ‘we’ when referring to Kiva. That also comes with being a Kiva Fellow. Still puts a smile on my face. Such a geek. I know.).

The first thing Kiva has implemented is a new and improved client waiver to be implemented by Field Partners that all Kiva Borrowers must sign. This waiver acknowledges that they have been made aware of what Kiva is, how it operates, and how their information and images will be used.  For group loans, it can be signed by the group leader. For those that can’t read, it has to be read to them and signed by both the borrower and the reader. It’s available in all the official local languages.

Next is a partnership with Ernst and Young. There’s no messing around. The pros are brought in for some external auditing help. E & Y will mobilize its skilled professionals around the world to assist Kiva in increasing transparency with a donation of $1,000,000 of in-kind resources over three years.

And then, of course, are the lowly Kiva Fellows. We do this kind of borrower verification both informally and formally.  Every time we meet with a Kiva Borrower we’re doubling checking the details from the website against the reality (or we should be).  Then, for some, there’s a formal process involving random sampling, spreadsheets, account speak procedures, etc… depending on the MFI we’re working with.

Each case would be dealt with slightly differently depending on the circumstances, so I can’t really go into what steps Kiva takes when there are discrepancies (and as a volunteer Kiva Fellow it’s a bit above my pay grade to speculate) but I can say that it is taken very seriously at every level of the organization.  I’m afraid to say it has happened before and may happen again.  There will always be temptations when money is involved. These steps will undoubtedly curb any kind of bad behavior and limit the damage it does. Kiva has been very open in the past about these incidents (there’s that transparency thing again) and Kiva Lenders have been and will be made aware when discrepancies arise.

So, that’s borrower verification, how and why we do it. It’s not as sexy as some of the other jobs we have but is central to Kiva’s growth and delivering on the promise we make to Kiva Lenders.

A belated Happy Canada Day to my compatriots and a Happy 4^th of July to my neighbours to the south. Let’s not forget to wish a Happy Independence Day to our Kiva Borrowers in Mozambique (June 25^th) and the Democratic Republic of Congo (June 30^th), as well as in Rwanda for Liberation Day (July 4^th).

Saludos,

Rob

Rob Mittelman is a member of KF8 and will be working with EDAPROSPO in Lima, Peru for 10 weeks. To check out EDAPROSPO on Kiva, click here.

By Drew Loizeaux, KF8 Philippines

The last 4 months working as a Kiva Fellow have allowed me an up close look at many different sides of microfinance. It has been fascinating for me to see and made me look at the loans I make through Kiva in a different way.

As Kiva Lenders, our money not only goes to the borrowers themselves, but through our interest free loans we are also directly supporting each Kiva Partner that we lend through. Each Kiva Partner is different, and no matter what your reason is for believing in the power of microfinance, there is an organization that will fit your philosophy. In the same way that you may buy local, fair trade or made in the USA products you also can put your money in an MFI who’s mission you connect with. This is a powerful tool that each lender can, and should appreciate.

At ASKI for example, the MFI I am currently working with, the revenues from the microcredit program go to fund many other social programs that help enrich the lives of not only their clients, but also the communities in which they live. Below you can see are a few videos that highlight the ripple affects our loans can have.

This is a presentation I attended last week, where a member of a local ASKI sponsored youth group explains a village water project they are working on.

ASKI has always looked to provide more than just microcredit to their clients; ASKI Foundation was created last year to formalize and strengthen some of ASKI’s “Beyond Microfinance” programs. You can see ASKI Foundation General Manager, Bogg Burbos, talk about its programs further in the video below.

While we may be only directly funding one Entrepreneur at a time when we make a loan on Kiva.org, seeking out information about the MFI that supports the entrepreneur and understanding what the revenues from our loans will be used to do can enhance and enrich the lending experience. Happy lending!

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To learn more about ASKI you can visit their website here.

To see ASKI loans currently funding click here.

To join the ASKI lending team click here.

Drew Loizeaux has been a Kiva Fellow since Febuary 2009 and is currently working at Kiva’s partner ASKI in the Philippines.

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!

By John Soleanicov, KF8 DRC

I could feel the beads of sweat rolling down my face.  Sitting in a makeshift police station under a tent, I was surrounded by three Congolese policemen and my accuser, a young man that could not have been past his mid twenties.  My crime: videotaping in public.

As I was returning from a group visit with Hope’s Kiva Coordinator, Robert, I wanted to capture the infrastructure realities of Kinshasa (more on this in a later post).  The young man noticed I was taping and began to follow our motorcycle.  You can actually hear him in the video.

Once we arrived at our destination, he made a big scandal, refusing to let us leave peacefully.  Since he was clearly not a police officer, Robert suggested going to a nearby police station to settle the matter “officially.”  Having heard horror stories of the notorious corruption of Congolese police, I feared the confiscation of my camera, passport, or worse.

After an hour of discussion, the police decided that I had done nothing wrong.  Surprisingly, we were allowed to leave freely.  While the overall experience was quite frightening, it did provide me with several invaluable lessons:

Not all Congolese police are corrupt. I was shocked by the correctness of the police officers and happy that I trusted Robert’s instinct.  While corruption in their ranks continues to be a problem, perhaps this is a sign that reform is in the works.

Photography is taboo in the DRC. Before coming to Kinshasa, I had read that photography of government buildings was illegal.  However, aversion to cameras appears to be far more ingrained in Congolese society.  After years of repression under the Mobutu regime, photography has come to be seen as a tool used by those seeking to usurp the state or to report dissident activities.

This last point, of course, has implications for Kiva.  If you look through loans posted by Hope DRC, you will sometimes notice people hiding from or trying to avoid the camera.  One of the big challenges of implementing Kiva in the DRC is convincing people to have their pictures taken.  Once the reason for the picture is explained, however, people seem far more receptive to the idea.  (Note: Hope DRC is in the process of including a client waiver in all their group loan contracts, which will inform borrowers about the use of Kiva photos).

In one case, one of the younger group members actually had his own digital camera (used for his business).  Once the group warmed to the idea of Kiva, everyone suddenly wanted a picture with the mundele (the word for white person in Lingali, the local language of Kinshasa).

The Mundele

As with many of the challenges of DRC, there are signs of progress and change – one photo, and one Kiva loan, at a time.

To see all DRC loans fundraising on Kiva, click here. You can also join the Lend DRC lending team here. John Soleanicov is serving as a Kiva Fellow with Hope DRC (KF8).

By Kiva Fellows Program Team

Kiva’s launch in the United States on June 10th generated a huge amount of media attention for Kiva, and an equally-large number of hits for the Kiva Fellows Blog. Kudos goes to John Briggs KF8, currently on his second Kiva placement with KADET in Kenya, for his #1 in Q2 post in response to the “Pissed Off Kiva Lenders” lending team with 1,712 views to date.

The top 5 blogs in Q2 were:

1. Pissed Off Kiva Lenders, John Briggs KF8, Kenya

2. A Rose From Florence, Stephanie Koczela KF7, Uganda

3. M-Banking!, Brett Dobbs KF7, Kenya

4. I Am Living In Kisumu, Kenya, Milena Arciszewski KF7, Kenya

5. Welcome, Kiva, to West Timor!, Kieran Ball KF7, Indonesia

Quarter 2 has been a time of change for Kiva, both on a macro level, as people in Kenya and Cambodia make their first Kiva loans to entrepreneurs in northern California and New York City, and a micro level, as Kiva Fellows upload short videos to this very blog detailing the daily activities of borrowers and loan officers alike.

Emily Sweeney KF7, Peru, found the time to travel to Lake Titicaca, where she later found out that many of the artisans selling their crafts on the floating islands were borrowers of her MFI, Manuela Ramos. She was particularly struck by the way microfinance had merged with the unique island culture of Los Uros.  Katie Davis KF7, Cambodia, got a crash course in rice accounting from staff at her MFI in Cambodia, vastly different from the sophisticated financial and analytic tools she used at her job in the United States, but which proved to be incredibly effective.  Several new KF8 fellows have undergone changes since starting their placements in late May and June, including Alia Rafeh KF8, Lebanon, who traveled 7,000 miles to begin her placement with Al Majmoua, Cissy DeLuca KF8, Indonesia, who made the official change from Kiva intern to Kiva Fellow this past Sunday as she departed for her fellowship with TLM via Taipei and Tamara Sanderson KF8, Mongolia, whose role at Kiva changed from volunteer to fellow as she started her placement with XacBank, noting the important role connection plays in empowering a relatively new Kiva MFI.

Videos you should be sure to check out:

Zev travels home from work in Indonesia

Hanh attempts to cross Hanoi’s bustling/frenetic (depending on your point of view) streets shortly after arriving in Vietnam

Athan ate a traditional Umu meal in Samoa

Ashley King-Bischof posted a video of thank yous from borrowers in Cameroon

If you’re interested in learning more about the Kiva Fellows Program or other opportunities to get involved with Kiva, be sure to check out the Do More section on the Kiva website.

By Cynthia McMurry, KF8 Ecuador

Time and cost are enormous disincentives for the working poor when it comes to getting medical treatment. Time spent visiting the doctor is time you’re not at work generating income, and money spent on these visits is money that could otherwise be spent on your children’s education or reinvested in your business. These disincentives are strong enough that relatively minor, treatable ailments often go untreated and eventually develop into much more complicated, serious conditions that require more intensive treatments and can even be incapacitating.

To mitigate this problem, medical care must be made cheaper and more convenient, and this is exactly what’s being done at the Cuenca branch office of Fundación Espoir. The office has an on-site doctor’s office. Each client pays $4.50 per 6-month loan cycle, for which she is entitled to unlimited free doctor’s visits for herself, her husband and her children. Women can get Pap tests, pre- and post-natal care and birth control counseling, in addition to a wide variety of treatments for common ailments. The clinic, which is always staffed by one of two doctors, serves 250-280 women and their family members each month. Dr. Maria Eulalia Robles says that most clients, whether women, men or children, come in for three reasons: dermatological problems, respiratory ailments, and diarrhea. Treatment is key, especially for children: left untreated, respiratory ailments and diarrheal diseases are responsible for almost 40% of mortality in Ecuadorian children ages 1-4 (as of 1999).

The clinic is understandably limited in terms of the services it can provide, since there’s no on-site laboratory or sophisticated machinery for taking x-rays or performing mammograms. For more specialized services like these, Espoir’s doctors refer clients to low-cost local specialists like gynecologists, optometrists, dentists, and chiropractors. One of branch manager Eulogio Rojas’ goals is to acquire a mammography machine for the clinic, though he says that at the moment he can’t justify the cost of such a machine ($40,000+) for the less than 2,000 clients the office serves.

Dr. Robles says that more than half the clients she sees come in before or after their group meetings at Espoir’s office. In a sense, this is a good thing, since it means that clients will seek medical care when it’s made more convenient for them. It’s also troubling, though, since about half the clients served by the Cuenca branch office hold their meetings in the field, closer to home. Rural clients visit the clinic much less frequently because of the opportunity cost implicit in each trip to the city.

Another challenge she faces is cultural. Getting an annual Pap test is a foreign concept for most clients, and for many it goes beyond being merely uncomfortable. Dr. Robles says some clients consider the test on par with rape. Many women’s husbands are against the idea, so the small percentage of clients who do come in for Pap tests often do so secretly.

Both Dr. Robles and Eulogio Rojas hope that the clinic will offer a wider range of services in the future; the office has already shown impressive progress and growth over its short life. The clinic opened six years ago, and in its first years treated a maximum of 90 clients per month. Today, it sometimes treats that many patients in one week. The clinic has also had electronic medical records for all patients for the past three years (which is more than many clinics in the US can say!).

Dr. Robles tells me of a patient she treated just a couple of weeks ago. The client, a 36-year-old, overweight woman with hypertension, came in for a basic gynecological exam, in which the doctor found a uterine polyp that could develop into cancer if left untreated. She referred the client to a gynecologist, who found that the patient had incipient uterine cancer and operated immediately to remove the polyp. The operation appears to have been successful! If this young mother hadn’t had convenient, low-cost access to medical care, this close call might have turned into a tragic ending.

The innovative medical care facility offered by Fundación Espoir is one of a whole slew of reasons why I’m excited to help them get started as a brand new Kiva field partner (and its only active Ecuadorian partner)! In my first two weeks working with the institution, I’ve been consistently impressed by its staff’s dedication to improving clients’ lives through savings accounts, loans, and business training and health education services. Eulogio Rojas sees Espoir’s partnership with Kiva as a great opportunity to get to know his own clients a little better, an attitude I applaud. Personally, I can’t wait for Kiva lenders to get to know Espoir’s clients!

To search for currently fundraising Espoir loans on Kiva, click here. No currently fundraising clients? Please check back soon! In the meantime, you can join Espoir’s Kiva Lending Team here.

Cynthia McMurry is a fourth-time Kiva fellow working with brand new Kiva field partner Fundación Espoir in Cuenca, Ecuador. Previously she worked with Fundación AgroCapital in Bolivia and FINCA Peru and Asociación Arariwa in Peru.

By Susan Arthur, KF8, Nicaragua

Dear Kiva Novela Fans,

I was unable to upload the two videos that were to accompany last Saturday’s (Episode 2) of “As the Microfinance Mundo Turns.” So consider this to be Episode 2.5. Don’t miss Laura Hopps’s testimonial about Doña Cony’s ice cream. Laura lives in Nicaragua and volunteers for the Centro Cultural Batahola Norte. Follow her Friends of Batahola blog if you want to learn more.

Also, your mouth will water when Doña Cony lists the ingredients in her ice cream.

Doña Cony’s dream, as announced in the first episode of “As the Microfinance Mundo Turns”, is to open her own restaurant.

Will Doña Cony seek credit from one of Kiva’s field partners in Nicaragua? Will she apply at CEPRODEL? Will she qualify? What does she have to do to get a loan? Stay tuned for upcoming episodes of “As the Microfinance Mundo Turns.”

Join the Fans of Ceprodel Lending Team.

The cool, air-conditioned air and excited, friendly people inside the Center for Community Transformation (CCT) office was a pleasant change from chaos and hot, humid weather of Manila outside. Last Tuesday was the first day of the Kiva Partnership with CCT, and my first day as a Kiva Fellow.  Managers from different areas of CCT participated in the first day of Kiva-led training. They listened with rapt attention as Rico, Kiva’s Asian Partner Development Specialist, explained the implementation process and demonstrated tools to track loans. Coming from the consulting world, the training was quite different to meetings I was used to: instead of everyone being at a meeting that no one wanted to be at, here, everyone was excited and enthusiastic.

The second day of training focused on how to write and post borrower profiles and journal entries, and included representatives from many of CCT’s branches. These representatives will be responsible for overseeing Kiva posts for their branches. The highlight of the day was posting CCT’s first borrower profiles on Kiva.org. Laughter filled the room as CCT workers took turns writing their first profiles. As the profile of the first borrower, Ofelia Mustapha, a shoe seller from Pasay City, hit Kiva.org, cheers erupted around the room.

As soon as the Kiva-led training finished, CCT’s managers transitioned right into internal implementation planning. “What do we need to do move from ‘Pilot’ to ‘Active’ stage?” “What do we need to do this month?” “What other information do we need to start collecting from borrowers [called partners here] to give lenders all the information they want to know about entrepreneurs looking for loans?” Speaking in a mixture of Tagalog and English, staff members shouted out ideas that were captured on an old white board and recorded in an Excel spreadsheet. For CCT to move to the “Active” stage as soon as possible, and for entrepreneurs in the Philippines to get much-needed loans quickly, there’s no time to waste.

Merrick Brown is a Kiva Fellow with Center for Community Transformation (CCT) in Manila, Philippines.

By Susan Arthur, KF8 Nicaragua

Doña Cony is quite the savvy business women.

She lives in Batahola Norte, a neighborhood in Managua, Nicaragua, the second poorest country in Latin America after Haiti, according to the World Bank.

Purveyor of Nicaragua´s Best Ice Cream

She sells her own homemade ice cream, rents rooms in her house to visitors who come to Nicaragua to volunteer, teach or study and cooks them delicious meals served at the family’s dining room table. On weekends she runs a catering business for neighbors celebrating special occasions, including weddings and quinceañeras or coming-of-age parties when girls turn 15.

In a large plastic bowl in her outdoor kitchen in the back courtyard, Doña Cony stirs the ingredients for ice cream – milk, fruit, sugar, cinnamon and rum – and pours the cool mixture into individual-sized plastic bags which she freezes overnight in her refrigerator.

All day long in the 90 degree muggy heat, school children, mothers with babies on their hips  and sweaty young men who play basketball and soccer in the park across the street come to her front gate and ask, “¿Hay helado?” — “Is there ice cream?” She usually offers only two flavors a day and sells them to customers who bite off a corner and slurp down flavors bursting with coconut, mango, guayabana, ciruela (prune), pitaya, pineapple or mamón (from the lychee family).

Two weeks ago when the cost of milk jumped, Doña Cony raised the price of her ice creams from 3 cordobas (15 cents) to 4 cordoboas (20 cents). When she told her customers about the price increase most customers did not have the extra cordoba to spend but Doña Cony told them to pay her back next time.

A year ago she used to sell 500 ice cream bags in three days but now sells only 50 in the same time period. In Nicaragua, according to The FINANCIAL 2009, food price inflation rose from 11% annually in January 2006 to 34% annually in August 2008. The impact of these price increases clearly has a disproportionate impact on Nicaragua’s poor as a larger percentage of their income is devoted to food costs.

Doña Cony’s dream, as announced in the first episode of “As the Microfinance Mundo Turns” is to open her own restaurant or fritanga as they are called in Nicaragua. There is no fritanga in her immediate neighborhood.

Will Doña Cony seek credit from one of Kiva’s field partners in Nicaragua? Perhaps CEPRODEL? Will she qualify? What does she have to do to get a loan? Stay tuned for upcoming episodes of “As the Microfinance Mundo Turns.”

Join the Ceprodel Lending Team.

By Suzy Marinkovich, KF8 Peru

As I sat this morning, drowning in over 50 borrower interviews I’d done that need to be typed and uploaded, I felt overwhelmed with bureaucracy.  Our Kiva Coordinator then walked in to let me know we had five more community bank meetings – FIVE – meaning I had a ton more interviews to do.   For a moment, I actually thought about turning her down so I could catch up on typing up the previous ones.  Regardless, I picked up my scrappy notebook and pen and ran downstairs to meet with the first group of women.

As I interviewed, I laughed with them, listened closely to them, hugged them, told them I admired them, and made sure to hang on to every word.  I was beside myself that I almost turned them down to do paperwork.  I’d gotten so used to the importance of paperwork at my last job in the US, it had actually pained me to ignore it.

At lunch I walked (more like trekked) to my apartment and took a seat on my fluorescent green plastic chair, took a long stare at the wall and began to think about the phrase “ignorance is bliss.”

Let’s pretend that its converse is “education is cynicism.”

Criticism abounds for Kiva, and more noticeably, for microfinance in general.  In fact, criticism pervades international development.  When one thing goes wrong, one borrower gets deeper into poverty, suddenly microfinance is moot.  If 99% of stories we hear are positive, we play extra close attention to that flaw.  And suddenly, every attempt at tackling poverty is debunked or worse yet, accused of worsening the situation.

This is an enormous problem with the way we look at poverty.

We sit comfortably at cafes sipping lovely lattes, pondering life.

Myself included, we look at certain international crises and we debate over what the solution may be – then we conclude there is no solution.  “Man… that’s a crappy situation.  Let’s talk about something else now.  So… the Chargers are totally going all the way this year..”

Then we move on with our night.

Thomas Pogge says it beautifully.

That we are naturally myopic and conformist enough to be easily reconciled to the hunger abroad may be fortunate for us, who can ‘recognize ourselves’, can lead worthwhile and fulfilling lives without much thought about the origins of our affluence. But it is quite unfortunate for the global poor, whose best hope may be our moral reflection.

Okay, moral reflectors and idea-debating post-graduates… I’m about to drop a bomb.

Microfinance is working wonderfully up here in the Andes!

…Nope, I have no amendments to that phrase.

Here are some of the stories I would have missed this morning if I had stuck to my paperwork:

I met a woman named Berta who was renting a small apartment, until she began taking out FINCA loans.  Through the various loan cycles and many educational business classes, FINCA helped her build her first home.  She recently built a second story to that home.  And now, she is getting ready to rent out the first floor for additional income.

Maria never knew what savings was until FINCA explained it to her.  Over the many loan cycles, she built a savings.  When her husband fell critically ill last year, she had enough money to cover his hospital visits.  He is alive and well today.

Felicitas, with a huge smile, raised her hands to her face and told me to look at them.  She said she works until the hands fall asleep at night. She never gives up working hard and long hours, because FINCA believes in her. The other women in her communal bank carry eachother and give one another strength.  Her loan has helped her to believe in herself.

Maribel had zero capital to her name.  FINCA and the Kiva lenders trusted her and gave her a loan for a copy machine, which she used to open a copy shop.  She can now afford to send her children to school.  For the record, that is exactly how Kinko’s started.  With one shop in Santa Barbara, California, that held one copy machine.

And my favorite, because I cynically never thought I’d actually hear this, Dolores said verbatim: “FINCA has allowed me to break out of the poverty my family was trapped in.”

Though I feel like I “should” close with something like “now, this isn’t the case everywhere…” – I’m not going to.  Call me ignorant, but what we are doing here is working.  We have no reason to apologize for it.  In fact, you should be honored to be a part of it.

Click here to make a loan to a borrower at FINCA Peru.

Suzy Marinkovich is a Kiva Fellow at FINCA Peru in Ayacucho, the first of her three placements.  She has a wholehearted passion for microfinance, social justice, and poverty alleviation.  Suzy is most excited to listen to the incredible stories of Kiva borrowers in South America and let them know how much they continually inspire us all.

By Cameron Morris, KF8 – Mozambique

During Kiva Fellows training we were tasked with putting Kiva’s Mission statement into our own words. This gave us the opportunity to critically think about Kiva’s mission and to highlight aspects of the mission that we thought most important. I placed emphasis on Kiva’s use of technology to meet its goals. Having been in the field, Mozambique , for a little over a week I have been amazed by the creative leveraging of basic technologies by my MFI.

Mozambique is a country that is still recovering from a 15 year civil war, and is tremendously under served by the public sector. Much of the existing public infrastructure in Mozambique pre-dates colonial independence. In the region that my MFI operates (Matutuine, Southern Maputo Province) there are virtually no paved roads and basic “luxuries” such as showers are non-existent. In this climate, private sector technologies are heavily relied upon and creatively used to fill in where the public sector cannot provide. Here are a few examples:

Mobile Technologies

My Nokia 1200, purchased in corner shop for $USD 30

The cellphone is something that is heavily touted in conversations about development, from providing weather information to farmers, to the concept of the community phone, to M-banking as described by Kiva Fellow Lee Bruner . However the primary use of the cellphone and its current price point cannot be overemphasized. In most developing countries getting a land line is impossible, without cellphones telephony simply wouldn’t occur. I was able to buy a fully functioning Nokia 1200 cellphone at a corner shop for $30 upon arrival in Mozambique. At this price point the cellphone is something that can be made available one way or another to almost anyone. While the basic use of cellphone technology in an MFI is evident, further productivity gains can easily be achieved with a little ingenuity. Example: Using a GPS enabled cellphone MFIs can accurately track the location of their clients in places where addresses do not exist. This not only provides fundamental client data, but can also be used to assess the costs of servicing these clients and determining the most efficient way to visit them.

Computing and the Internet

Asus Netbook with Vodacom 3G card

Ubiquitous internet access and affordable computing hardware in developing countries are both really mind boggling. The fact that Kiva has 119 partners across 47countries with sufficient bandwidth and computing power to use Kiva is incredible. Broadband internet access only became affordable to consumers at the beginning of this decade and up until very recently computers were prohibitively expensive. In rural Mozambique my MFI is able to access the internet using 3G wireless cards at a faster rate and with less interference than I can get in San Francisco. This means that they don’t have to spend unnecessary time transporting documents across an unreliable network of roads. It also means that they are able to train their employees using distance learning programs, that could not be locally matched offline.

Kiva

Your favorite website! Click to lend to an entrepreneur in Mozambique

Kiva’s website and P2P lending model have proven that capital can be efficiently allocated to the working poor without getting lost in multiple levels of bureaucracy. Current texts on development are riddled with stories of aid money disappearing in cleptocracies and bloated bureaucracies in some cases only 1% of the allocated funds reach the end user/project. This provides obvious benefits to MFIs as a funding source, but also empowers individual lenders to transparently lend their money and support the working poor.

These are just a few of the ways that I see the Jetsonian application of technology being used in the field and by Kiva. I’m sure there are countless others and I invite Kiva Fellows to share further examples in the comments. The bottom line is that the dissemination of technology is not only a positive externality realized by Kiva’s MFIs partners in their dealings with Kiva, but it is also touching and improving the lives of their clients and surrounding communities.

Cameron Morris is a member of KF8 currently working with Hluvuku-Adsema in Mozambique. He is enjoying familiarizing himself with a new dialect of Portuguese and learning a little Ronga.

Click here to lend to an entrepreneur in Mozambique.

Posted in Africa, All, Hluvuku-Adsema, KF8 (Kiva Fellows 8th Class), Mozambique Tagged: Connectivity, KF8, Kiva, Mozambican Microfinance, Mozambique, Netbooks, Technology and Development ]]> http://fellowsblog.kiva.org/2009/06/26/the-dissemination-of-technology-development-and-kiva/feed/ 6 morrisctm Nokia 1200 Netbook Kiva http://fellowsblog.kiva.org/2009/06/25/behind-the-curtain-%e2%80%93-getting-a-new-mfi-on-the-kiva-platform/ http://fellowsblog.kiva.org/2009/06/25/behind-the-curtain-%e2%80%93-getting-a-new-mfi-on-the-kiva-platform/#comments Thu, 25 Jun 2009 14:00:32 +0000 boba http://fellowsblog.kiva.org/?p=5354 ]]>

A Kiva entrepreneur in Kyrgyzstan who has also created a Center of Temporary Stay for Orphaned Children using her own funds and resources. Click to learn more.

By Boris Mordkovich, KF8 – Kyrgyzstan

After doing a Kiva Fellowship in Tajikistan during February and March of this year, I’ve returned to Kiva this summer to do another placement in Kyrgyzstan.

Within the first two weeks at the micro-finance institution, it became very clear that this placement will be quite different from the first one. It’s actually quite amazing how much things can vary from one MFI to the other, from one country to another.

The main difference between the two placements is that the first MFI I was working with in Tajikistan was already on the Kiva platform for over a year when I arrived. They already had an established system in place for collecting data and posting profiles of their borrowers on the website. And while there was some room for improvements here and there, as a whole, it functioned very well.

My new, current placement – in Kyrgyzstan – is with a brand-new, pilot partner that’s just getting started with Kiva. It’s very exciting to be a part of the start-up phase and build the processes block by block, but it poses its own set of challenges and makes you appreciate how complex the system really is.

On the surface, as all of you know, it appears relatively simple – a lender submits a payment through PayPal and the money eventually gets to the borrower (although in most cases the MFI “fronts” the funds in advance of the loan getting funded on Kiva). But underneath this seemingly simple and clear process is the work of literally hundreds of people and very interesting “supply-chain”.

The Challenges

When a new MFI joins the Kiva family, one of the first things they need to do is train their loan officers to collect a new set of information necessary for the Kiva stories, since much of this information is not collected or recorded previously. When your organization has several hundred loan officers and growing daily, training the staff is a challenge. Particularly because of two reasons. For one, many loan officers handle a large case load as it is, so it’s difficult to convince them on the merits of doing additional paperwork. Secondly, oftentimes, it’s difficult to convey to them that somebody across the world is actually interested that their client has bought a cow or a chicken and so on. When you deal with these things day in and day out, it doesn’t seem remarkable or worthy of reporting.

But even when you get the loan officers onboard, you’ve only won half of the battle.

The second challenge is the transfer of the information. Living in the U.S., it’s difficult to realize how the flow of information changes when Internet and computers are taken out of the picture. My MFI, like many others, has several dozen branches spread out all over the country. So how do you get the information on the clients from these far-away branches into the headquarters where a Kiva coordinator can write and post the story on Kiva?

We’re lucky that Kyrgyzstan has a fairly good Internet connectivity across the country – most other Kiva partners do not. But even with that connectivity, it’s problematic because peoople are not used to doing their work on the computers and converting the data from paper forms into electronic format takes an extraordinary amount of time, effort and training.

All of these are solvable issues – so I have no doubts that we’ll make it work. But when you consider all of the challenges, number of people involved all over the world, the varying environments and operations, it’s simply amazing that the system as a whole works, and works so well.

If you’d like to learn more about Kyrgyzstan and support entrepreneurs in that region, please check out and join our new lending team – Supporters of Kyrgyzstan – http://kiva.org/team/kyrgyzstan. Team members will get special updates and information from the Kiva Fellow and the MFI.

An interesting issue was raised this week when I mentioned to a friend that more than  two thirds of microfinance clients around the world are women. My friend posed the question: how are men reacting to this?

As a Kiva Fellow and a Kiva Lender, one of the things I value most about microfinance is it’s ability to raise the status of women.

A Kiva borrower, working side by side with her husband in her grocery shop in Nepal

At ‘BPW Patan’, the Kiva partner in Nepal where I am currently based, 100% of the borrowers are women. Although Kiva supports lending to men and women alike, at present more than 80% of the Kiva borrowers are women. The Grameen Bank have a 94% women borrower base and the United Nations estimates that roughly 76% of all microfinance clients around the world are women.

Lending to women has it’s benefits. A number of microfinance organisations including the Grameen Bank have found that women are more likely to repay loans than men which, from an investment perspective, makes women borrowers more sustainable. Studies have also found women are more likely to invest their income in education and health care for their children. Furthermore, lending to women creates an opportunity for financial independence that did not previously exist and gives women a sense of entitlement to contribute to the decisions on how money should be spent within the family. This naturally leads to an increase in women’s status in the home and in the wider community.

The various benefits of lending to women, combined with the fact that more women than men are accessing microfinance loans around the world, led my friend and I into a spirited debate regarding the potential impact this has on traditional gender roles, particularly in patriarchal cultures.

Some of the questions raised included: Are men feeling redundant because they are no longer the breadwinner? Is domestic violence decreasing or increasing as a result of this? Are husbands resentful of their wives success, particularly if their wife begins to earn more money than them? Are the tasks that were previously fulfilled by women, such as cooking and watching over the children, being shared more equally by men in the family? Are traditions that have been upheld for hundreds of years, particularly those ones that enforce gender roles, beginning to change?

I put these questions to my own field partner, BPW Patan, and also to all of the Kiva Fellows currently based in the field. These were my findings.

In Nepal, the general consensus is that men have been very supportive of the success their wives have encountered through microfinance loans, even if women begin to earn a higher income than their husbands. Urmila Shrestha, the President of BPW Patan, shared one story of a woman whose grocery shop was so successful that her husband abandoned his own profession and joined her in running the business. The borrower told Urmila: “Before microfinance, all of the decisions in our family were made by my husband. I didn’t get a say in anything, not even with the decisions that affected my own children. Now that I contribute the same amount of money to our family expenses, he comes to me and we make every decision together, even the small decisions.”

Urmila, the President of BPW Patan, meeting with a group of women as they take out their first loan

Earlier this week I travelled with BPW Patan to meet for the first time with a group of new women borrowers living in a rural village that relies mainly on subsistence agriculture. For many of the women, it is the first time they have taken on the responsibility of managing a loan and are being given the opportunity to generate their own income. During the visit, I spoke with one of the husbands of a new Kiva borrower. Durga’s wife is taking out her first microfinance loan which she will use to purchase vegetables so she can grow produce and sell it at the local market. This will be the first time Durga’s wife will earn her own income. Currently Durga is working as a road worker and he is the sole breadwinner in the family. Due to the loan, however, Durga will soon leave his job and begin working with his wife on her vegetable farm. When I asked who currently makes the money decisions in the family, Durga said he makes most of them but that he expects this to change when his wife takes on the responsibility of a loan. Durga also said that he is very supportive of his wife wanting to earn money and he then excused himself because he was concerned that his wife didn’t know his whereabouts and he wanted to return home to her.

 Mr Durga Raj, on his way home to meet his wife who is also his new business partner

A number of other Kiva Fellows have shared similar experiences of husbands being supportive of their wives financial independence. Kiva Fellow Nancy Tuller said she recently met a female borrower whose husband used to be the sole bread winner in the family. By starting her own business, the borrower says her husband has a new found respect for her and their relationship is stronger. Nancy has also previously worked with the Grameen Bank and in one meeting with a group of women borrowers she found that: “the women spoke about how their status or “power” had risen since they were members. As one woman said, “We get the money, so we get to make the decisions.” The women unilaterally agreed that they had more power than before”.

Another Kiva Fellow, Lee Bruner, recently met with a female borrower who took out a loan to improve her beauty parlour. Her business did so well that her husband began working with her and she became the president of her borrowing group. This woman is considered to be the most responsible person in her group and, through the power of microfinance, her status has been raised in the community.

Unfortunately, not every Kiva Fellow has observed the type of women empowerment that myself and other Kiva Fellows have witnessed.

Kiva Fellow Suzy Marinkovich noted that although microfinance has empowered women and provided employment opportunities, some of the feedback from the women has indicated that their husbands don’t work as much anymore and spend more time drinking alcohol purchased with money that could otherwise be spent on the family.

Kiva Fellow Sarah Forbes noticed a number of problems women encountered as they began to gain financial independence. One loan officer said to Sarah that some of the borrowers do not tell their husbands they are taking out a loan because they worry that if their husbands find out they are earning money, they will take it from them. This can then lead to further problems because the borrower may struggle to make repayments and the borrower’s husband may not see it as his responsibility to make the repayment for her.

My overall conclusion, certainly in the case of Nepal, is that microfinance is slowly improving the way in which women are perceived in both the home and the community. And whilst in certain locations microfinance may not have led to parity between the sexes, responses from Kiva Fellows and my own observations in Nepal indicate that gender relations are improving and the status of women is being raised rather than remaining stagnant.

I would like to thank the Kiva Fellows for their contributions to this blog, specifically:

Tamara Sanderson, Hanh Tran, Nancy Tuller, Suzy Marinkovich, Laura Buhler, Ashley King-Bischof, Lee Bruner, Cynthia McMurry and Sarah Forbes.

This past week I heard from a friend in the US who got the new iPhone. It looks pretty cool – smaller, faster, and even has the long-awaited cut/copy/paste feature. All for just USD $199…

But what if you used your phone to make a living? What if it had nothing to do with apps, downloading music or texting your friends?

Last week I interviewed groups that were getting loan disbursements and also followed up with existing Kiva borrowers. While the majority of clients were planning buy more merchandise for their general stores or small businesses, two women stuck out in particular: Rosa and Grimanesa. Rosa and Grimanesa invested in their cell phone businesses. As part-time jobs, they stand on busy street corners and charge people to use their cell phones to make local and long distance calls. Why would somebody pay to use their phones? It costs more to call a cell phone from a public pay phone, and you don’t get change back for coins that are deposited. In Peru a basic cell phone costs around $30 USD, and current rates are about  15 cents a minute to call other cell phones and and 10 cents  per text msg.  This is still too expensive for a majority to have mobile access, especially small business owners that are receving microloans.

These women’s businesses caught my attention because they were using a mobile phone as a means to make income – exactly the opposite of how frequently I find myself spending money on unnecessary apps and songs. And it also made think about mobile banking in microfinance. If these women are making a living with the cell phones, couldn’t mobile services also be a way to provide better financial services to them? After all, I followed up with Grimanesa via a cell phone call to discuss her Kiva loan.

There is so much potential for m-banking, especially to help lower administrative costs to borrowers in rural areas. What if Rosa and Grimanesa could make their loan payments on their phones, or charge others a nominal fee to do so?  What if they could text updates to their loan officers? What if they were rural farmers and could get access to weather forecasts to determine when to plant crops or  coordinate delivery times to markets?

My first reaction is to say that this makes perfect sense. It seems like an ideal way to incorporate technology into microfinance.  However, there are cons that I didn’t see until spending time out in the field.

An Arariwa loan officer offering financial training at a group loan meeting.

Monthly group repayment meetings are an important part of lending: they promote a sense of community, strengthen accountability, and also provide an ongoing forum for financial education. For example, last week I accompanied a loan officer who taught her group about the dangers of taking out loans to pay off other loans and then did a case study to demonstrate long-term growth strategies.  Group members shared their stories and observations about local markets conditions, and also collectively decided how to help members who were struggling to make a profit. How much is this worth, especially to those who had to give up a few hours of work to come to a repayment meeting?

It seems contradictory: a cell phone has the capacity to keep us connected 24/7 and help us to make more informed decisions, but it can also isolate us. For many people,  ordering take out or paying a credit card bill can be done on a mobile phone without any interaction.  But we lose the intrinsic value of personal connections, and in microfinance, face-to-face time with other entrepreneurs and financial educators is invaluable. There are emotions that emoticons can’t capture – like an entrepreneur who just made her first profit – and 160 characters couldn’t cut it to describe the impact that it’s having on her family.

Does it make sense for MFIs to start transitioning to m-banking as cell phone service becomes more accessible?  From what I’ve seen in the field, I believe so, but it will have to be done very carefully as to not undermine the strong sense of community that group loans promote. I’m sure that there are already some pilot programs underway that are facing these challenges, and I’ll be interested to hear follow-ups about m-banking with  Kiva Field Partners such as K-MET in Kenya. CGAP’s technology blog has also had some interesting articles concerning m-banking.

And in the meantime, I just keep asking myself:  what could Rosa and Grimanesa do with an iPhone?

Lee Bruner is a member of KF8 currently based in Cusco, Perú with Asociación Arariwa.  He’s looking forward to hearing any ideas, comments or updates about mobile banking being used in the field!

I am sure that many of you have read of the horrors that occurred here in Rwanda almost exactly 15 years ago, but few of us can actually envision the magnitude of such tragedy and its consequences on a society.

Upon arrival in Rwanda I have noticed many hindrances to development and I have generated a lot of criticism for the country’s economic goals etc. But my first visit to a genocide memorial changed my perspective on the place. Rather, it reminded me of the individuals that make up Rwandan society, and how truly extraordinary it is that they have managed to create a peaceful and functioning Rwanda after their experiences 15 years ago.

At Nyamata, a town about an hour south of Kigali, the capital, I was taken through a Roman Catholic church where 10,000 people were slaughtered and dismembered in the most unthinkable ways. These crimes were personal… each person was slain with deliberation and intent. Many were spectacles, butchered in front of their families and peers, killed on the church alter as the entire crowd was forced to watch. My guide, 23 year old Benoit, was there to see it all. A terrified 8-year-old forced to watch his entire community be murdered, survived to tell the tale and later become a participant in the society that so badly injured him.

I think to the majority of Rwandese that I have met, and almost all have stories of victimization during the genocide. Either that or they grew up outside of Rwanda in refugee camps often suffering from starvation and disease and other traumas that come hand in hand with living as a refugee. If none of the above, many would have grown up with their fathers and mothers in prison for having perpetrated the crimes. Ultimately, this genocide affected all in Rwanda. All. In my own society, if someone grew up with their parents in jail, we would call them “at-risk youth” and we would celebrate in if they went on to become functioning participants in society. If someone were exposed to the atrocities Benoit was at so young an age (or at any age), we may expect him to be in post-traumatic stress therapy for the remainder of his life, perhaps be prone to drugs and alcohol and have tremendous difficulty integrating back into the society that took his family away from him. If you were one who grew up in a refugee camp in Uganda, like thousands of Rwandese and like my friend Innocent, and had your sisters both die of starvation, your father die in the genocide and your mother die in an off-chance car accident, my society would probably be very surprised to see you become a hopeless optimist, one of the country’s leaders in development, and the holder of a Masters’ degree from the United States.

What I am illustrating here is the degree to which Rwanda has decided to push forward. One million people were killed in Rwanda in 1994, and many more in the previous “mini-genocides” that occurred from the 1950’s, 1970’s, and early 1990’s. That is the size of Calgary, my home town. I imagine my entire city of just over one million—obliterated.

Rwanda is an entire society comprised of people that we may have written off to be hopeless, potentially dysfunctional, if put in the context of our own society. And yet, their national motto is “hope” and they are combining efforts to live peaceful and productive lives, and to build up their country and their neighbours. Beyond doubt, Rwanda is one of the safest and most peaceful places I have ever been, however historically ironic that may be. This place truly is a miracle.

Rwanda's national symbol, the peace basket

It is clear to me that microfinance is one in a multitude of efforts in Rwanda that has enabled the country to the place where it is. Vision Finance Company (VFC) was established in 1999, just five years after the genocide. Its founders saw that if just this one area of stress— that of the family business— is put at ease through access to capital, savings programs, and insurance, there just may be less anxiety in the other areas of life. Its founders saw even so soon after the genocide that with financial security and economic empowerment often comes a safer and more stable community.

I don’t mean to sound trite, but perhaps microfinance’s contribution had more happening than just poverty alleviation. Partnered with good-governance and foreign aid, perhaps by taking away the single anxiety of financial uncertainty, microfinance helped make possible stability and peace.

If you would like to participate in what microfinance, make a loan to an entrepreneur!

Read some good news about Africa’s progress in development: Great article in the Globe and Mail !

Not long after my Kenya Airways flight slalomed into N’djili Airport, I began to hear the noise.  Drum beats.  Cheering.  Flag-waving masses of people.  “Wow,” I thought, “what a welcome.”  I had heard the Congolese were welcoming, but this is a bit over the top!

A Hero’s Welcome – Note the caravan of fans at the top right!

It turns out the ad-hoc parade wasn’t for me (Bummer!) but for the coach of one of the club football (soccer) teams here in Kinshasa.  Nevertheless, the conglomeration of people and noise proved to be an ideal introduction to this pulsating metropolis.  With 8 million souls, Kinshasa is considered by many to be the largest french-speaking city in the world.  It is the capital of the Democratic Republic of Congo (DRC), the third largest country in Africa, bordering almost all major conflict regions on the continent.

Usually, when I tell people I’m heading to the “Congo,” I get the same almost-scripted reaction.  Puzzlement, worry, doubt – “why would anyone willingly go to the DRC?”  I suppose the Congo has come to be seen as a basket case, a land of war, violence and suffering.  What I see, however, and what I hope to convey through this blog over the next two months, is Congo as a land of opportunity, a land of hope.

Let me be clear.  Congo has issues.  Power outages, crime, rampant corruption, the DRC ranks 181st out 181 countries on the World Bank’s “Doing Business” report.  But with tremendous challenge lies tremendous opportunity.

Rich in mineral wealth, and relatively stable since elections in 2006, the DRC seems to have finally turned the corner after centuries of violence and exploitation.  This is where you (Kiva Lender) come in.  By lending directly to entrepreneurs in the DRC through Kiva you are, in a way, reversing history, connecting with the Congolese on a basis of dignity and mutual respect.  So be sure to keep an eye out for DRC loans this summer and beyond, as the MFI I am working with, Hope DRC, plans to ramp-up its Kiva lending!

John Soleanicov is serving as a Kiva Fellow with Hope DRC (KF8).

Total chaos can be beautiful. Horns honk at me from left to right and the vibrations jump from one ear to the other. A river of motorbikes (xe oms) race past my taxi window. There appears to be no traffic lights, no speed limits and few rules. I stop to listen and start to see life—life as it is lived in Hanoi, Vietnam.

Having spent some time in Hanoi as an undergraduate, the bustling sounds of the Old Quarter are familiar and comforting. The streets lined with booming businesses of every sort are images that come to mind when I think about microfinance and entrepreneurship in Vietnam.

As I left Hanoi for Thanh Hoa, where I will be based as a fellow during the next three months, I wondered what entrepreneurship would look like in Vietnam’s second poorest province. During the foggy morning as my train rushed by brilliant shades of green across Vietnam’s lush rice paddies, I could not help but be captivated by the tranquil countryside. It’s raining as I leave the train station and my first sight of Thanh Hoa is a gray, damp and serene scene.

I did not know how quickly that initial portrait I painted of microfinance in Vietnam would change. The day before the start of my fellowship, I learned that some family members who I had never met before live in the Sao Vang district, a 1.5 hour bus ride from Thanh Hoa City where I am located. When I got to their house, I was greeted by a family of cows in the front yard. Later in the day, my aunt told me she took out a loan of 8 million VND ($450 USD) to help buy the mother cow. “A loan for the poor,” she said. I asked for details. She went on to describe how she sells vegetables at the market daily, making $1.90 USD on a good day. Due to her husband’s illness, he is unable to work regularly. She explained that the cows are easy for him to maintain, as all he has to do is cut grass for them to eat. Each year, the mother cow can give birth to one calf, resulting in a profit of approximately $150 USD per year.

The cows in the front yard!

When I began this fellowship, I was not aware of how close to home the impact of microfinance would be felt. My aunt is a borrower of a government microfinance loan. She does not consider herself an entrepreneur and has no intentions of opening a business. Simply put – she took the loan out of necessity. The additional income from the sale of cattle has allowed her to maintain a more stable family life and put food on the table during those times when her sales at the market are low. Thus, my image of microfinance and entrepreneurship in Vietnam as being merely busy city shops has been wiped away. I am so looking forward to filling in the colors of this new picture as I meet women borrowers from the Fund for Thanh Hoa Poor Women.

I consider it a matter of chance that I was born in the U.S. and given all the opportunity in the world. What an honor it is to have this opportunity to serve as a Kiva Fellow in Vietnam!

Hanh Tran is serving as a Kiva Fellow in Vietnam with the Fund for Thanh Hoa Poor Women (KF8). Join the Vietnam Critical Mass lending team to support entrepreneurs in Vietnam.

Bonjour from Benin,

            I am approaching the two-week mark of my fellowship in Benin and things are off to a good start!  I am working for Alidé, an MFI based in Cotonou, the largest city in Benin.  Alidé is a relatively new partner of Kiva and is showing great promise.  The Kiva Coordinator at Alidé, my main colleague, is committed to strengthening the partnership and teaching the other staff members how to use Kiva.  I have a good feeling that we will work well together.

            During these first few weeks, I have definitely noticed the language barrier.  I came to Benin with a good, working knowledge of French, but there have been inevitable difficulties.  People here in Cotonou speak French, but the accent is unfamiliar and conversations also include many words in Fon, the language native to this region.  I often find myself struggling to keep up.  Unfamiliar languages are common in almost every fellowship.  Even if English is a national language, fellows immerse themselves into cultures that use Swahili, Arabic, Samoan, or Cambodian.  There is bound to be frustration for everyone due to communication difficulties. 

            However, so far, I’ve found that learning a language has an incredible power to foster connections between people. Around the office, I greatly appreciate the patience and grace of Alidé’s staff when I do not completely understand something in French.  I’ve seen the hospitality of the Beninese people by their willingness to help me out.  Also, whenever I use a word or phrase in Fon, people instantly light up and become eager to teach me more.  They appreciate the attempt to understand their language and culture.  An instant friendship is born.  Using Fon is a great way to gain trust and to create a connection with Kiva borrowers. 

            The power of language is one simple way that Kiva’s mission to connect people is being implemented.  When you are forced to find ways to communicate, you gravitate towards shared beliefs and experiences.  I find that when communication is possible, the payoff is rewarding.  That reward is the knowledge that I have developed a relationship with someone who grew up in a different country and culture, and speaks a different language.  Fostering connections is part of the Kiva experience that fellows, lenders, and supporters all share to some degree.  Kiva allows us to understand the importance of engaging the global community.  I am fortunate to be a part of such an organization.  

Andrew Whiteman is  Kiva Fellow (KF8) working in Cotonou, Benin.

By Susan Arthur, KF8 Nicaragua

Dear readers,

I am a Kiva Fellow in Managua, Nicaragua, working with field partner CEPRODEL.  I’ve been here for a couple of weeks now, and am thrilled to announce Kiva’s first novela: “As the Microfinance Mundo (World) Turns.”

Novelas are soap operas which are very popular in Latin America and on Spanish-language television in the U.S. On this blog, I will unveil the story of Doña Cony as she seeks credit so she can open a “comedor” or small restaurant on the front porch of her house.

Located in Batahola Norte, a poor neighborhood in northwestern Managua not far from the old U.S. Embassy and right across the street from a park where young men shoot hoops or play soccer, the house is also kitty corner from a Cultural Center, where Doña Cony worked for eight years as a cook.

Be sure to watch the video for a rare opportunity to see Doña Cony resting in a hammock on her porch, the site of her future restaurant.

Will Dona Coñy seek credit from one of Kiva’s field partners in Nicaragua? Will she apply at CEPRODEL? Will she qualify?   What does she have to do to get a loan? Stay tuned for upcoming episodes of “As the Microfinance Mundo Turns.”

Susan Arthur is a Kiva Fellow (KF8) serving in Managua, Nicaragua with CEPRODEL. Join the Fans of Ceprodel Lending Team.

By John Briggs, KF8 Kenya

Update on sentiment shift: On June 23, Tom, the team captain for the (formerly) Pissed Off Kiva Lenders, changed the team name to Unhappy Kiva Lenders. Tom explained the name change in a posting on the team page: “I want the day to come soon when the team name will be ‘Delighted Again Kiva Lenders’ but the step above in the name change reflects current progress.”

Some Kiva lenders are pissed off about Kiva’s recent launch of loans to borrowers in the United States. Their angry cry has been heard in Kenya.

I arrived in Kenya two weeks ago to work with new Kiva field partner KADET. My marathon orientation-and-training tour is in full swing: this week I met dozens of KADET branch personnel in the western cities of Kisumu and Eldoret.

Successfully setting up Kiva-related operations poses many challenges for MFIs, but my new KADET colleagues made quick work of it. Both branches were able to post borrowers to Kiva on the same day they were introduced to it: Kisumu posted Maulyne’s loan and Eldoret posted Monicah’s loan.

Both loans were funded overnight, and the KADET staff was jubilant. At the Eldoret branch I joined KADET staff in poring over the Kiva lenders and lending teams who had supported Monicah. One lending team for Monicah’s loan jumped out at us: the Pissed Off Kiva Lenders.

Pissed off lenders? People at KADET were surprised. This wasn’t in the Kiva orientation I’d given them. Stephen Makanga, KADET’s integration and donor relations manager, and I decided to open the Pissed Off Kiva Lenders team page to find out more.

Image from the Pissed Off Kiva Lenders' team page

A statement on the page announced, “Kiva’s stated mission is to ‘alleviate poverty’. Poverty is defined as: ‘the state of having little or no money and few or no material possessions’. Does that sound more like the situation for US Kiva borrowers or borrowers from the Third World countries?”

Stephen gave the page an incredulous stare and kept reading.

“Now the truly impoverished are being asked to COMPETE for funds with borrowers in the US. The US is the wealthiest and most resource-full nation in world history. To think that we are asking lenders from the US and around the world to even consider lending to the US is a shameful, disgraceful decision.”

The sharp criticism went on.

“There was a recent Kiva loan request from a US man with a four year college degree in architecture and many years experience in that field. He decided he wanted to do something different and try his hand at website design. He was looking for $7000. If he gets it that’s $7000 which previously would have been available to 7-10 other borrowers in developing countries.”

After reading the whole statement, Stephen turned and looked at me. He waited a moment before he began to speak. “First of all, I believe there are poor people in the U.S. — forget about the wealth of the nation. If someone can reach those poor people because they understand their poverty, I have no problem with that. It’s okay.”

Stephen continued, “Poverty isn’t so simple — it’s a complex web comprising material deprivation, state of mind, and underutilized potential.”

He paused for a moment, and then turned to the Pissed Off Lenders’ criticism of the loan to the U.S. Kiva borrower who quit his job at an architecture firm in order to start his own business.

“I have a brother who stays at home and does vegetable farming. Whenever I go home, I don’t like having to give him money. Instead I like asking what he can do better than what he’s currently doing. The point is: what is more productive for him under his circumstances? If the man who worked in architecture is more productive being a web designer, then people should support him. It’s not like we’re short of people who can continue to support small loans on Kiva — this one won’t seriously affect the equation and supply and demand of small loans. I would be encouraged if that architect became more productive, and then was able to himself become a lender on Kiva.”

I thought about what he’d said, and was inclined to agree. But the Pissed Off Lenders still had a great point — what if competition from large loans to U.S. borrowers on Kiva began to crowd out funding for borrowers in places like Kenya? That would be unwelcome. I asked Stephen what he thought about that possibility.

“I believe there are people at Kiva who are watching to see if small entrepreneurs’ demands are being met,” he answered, adding, “If the demand for these bigger loans by U.S. entrepreneurs goes overboard, the Kiva people will obviously see it and put a check on it. The only time I would worry if is there were a shortage of people funding small loans, but before it would get to that point, I believe that the people at Kiva would have already taken action.”

Even though Stephen has just made Kiva’s acquaintance, it’s clear he trusts the judgment of its decision makers. To a point, however — he continued, “If the worst came to worst, KADET or other MFIs would still have access of loan capital, except those other sources are more expensive. I am also aware that there other peer-to-peer lenders, such as MYC4, although for MFIs their terms slightly different than Kiva.”

I nodded. Stephen had nailed it: While Kiva has helped fund over $75 million in loans so far, its contribution to microfinance funding represents a sliver of the multi-billion dollar microcredit industry. And Kiva, the first mover in person-to-person microlending, is beginning to get competition from other websites with a similar model, giving MFIs more of a choice of which organization they choose to partner with.

Moreover, as microfinance has come into its own, institutional investors with deep pockets have been aggressively courting many MFIs, albeit investors primarily interested in financial, not social, returns. So even if Kiva has misjudged by partnering with lenders that fund U.S. borrowers, its non-U.S. lending partners still have a variety of options of which to avail.

For all his faith in Kiva, Stephen did have one doubt related to Kiva’s launch of lending to U.S. borrowers. Towards the end of our conversation he said, “I have just recently learned that the individual loan limit for U.S. borrowers on Kiva is $10,000, but in Kenya and most other countries it’s only $1,200. I don’t like this at all.”

Stephen explained, “There are different categories of microfinance borrowers in Kenya who require loans that are far beyond the limit of $1,200.” He paused and looked at me intently, adding, “My last word is: it’s high time that Kiva think about revising the loan limits for countries like Kenya.”

I’d agree. Kiva’s limit on an individual loan size is $10,000 for borrowers in the U.S., $3,000 for borrowers in some countries in Eastern Europe, Central Asia, and the Middle East, and $1,200 for borrowers elsewhere. Kiva’s limits on loan sizes are usually pegged at or above the average size of microloans for a given country, but for most countries the limits haven’t been adjusted in a long time. If you’re a microentrepreneur in Kenya, $1,200 may not get you very far.

In working with KADET, I ran an analysis of loan disbursals the MFI made for the month of May and found many of them didn’t qualify for Kiva. Most of the disqualifed ones were below $2,000, and often they were just above the $1,200 loan limit. Group loan limits of an average of $400 per borrower also crimped things.

There were, however, more than enough smaller loans that qualified for Kiva to meet KADET’s fundraising target, so shutting out larger loans wasn’t a serious problem. It simply meant that a narrower range of KADET borrowers would make it to Kiva; borrowers with smaller loans tend to be newer (and riskier) KADET clients, while the ones that get larger loans are established clients who have proved their mettle and business acumen. Limit or not, KADET is committed to representing as many different kinds of its borrowers as possible on Kiva, small and large.

Like Stephen, I have faith in Kiva and the braintrust that has made it such a success. I’d imagine revisions to loan limits are in the works, especially with the advent of lending to U.S. borrowers.

I’m curious to find out what you think — should Kiva raise its loan limits? If so, should it be done on a universal basis, or should it be done on a country-by-country basis?

More on Kiva’s launch of U.S. lending: an open letter from Kiva President Premal Shah and CEO Matt Flannery about pilot partnerships in the U.S.; a Kiva Friends discussion of USA Lending; the Pissed Off Kiva Lenders page; and an earlier blog post I wrote, “Upending microcredit: Cambodians use Kiva to lend to U.S. borrowers“.

Kiva borrower Maulyne Obura and Stephen Makanga in Kisumu

Stephen Makanga is from Emali, Makueni District, Eastern Province, Kenya. Growing up, his father and mother were subsistence farmers who grew corn, beans, vegetables, and coffee (”when the industry was still good”), and raised livestock such as cows and goats. He has four sisters and five brothers, and is the youngest among his siblings. Stephen is the only one in his family to have attended university, though one brother attended a teacher training college and is now a primary school teacher. Stephen attended Egerton University in Nakuru, working his way through school as a public high school teacher; he got some support from his parents, but he also took out loans from the Higher Education Loans Board, which he’s still paying off at the age of 40. He graduated in 1994 with a degree in agricultural economics.

After graduation, it was hard for Stephen find steady employment, so he took a series of small teaching jobs. In 1997, he got a job with the Ministry of Agriculture as an agricultural extension officer, training farmers as a beekeeping specialist. He left his government position in 2000 to work for World Vision Kenya. At World Vision, he started as a program coordinator for a small food security project in the northeast of Kenya. He went on to be a program manager in charge of the Wajir (district in NE Kenya) relief and rehabilitation program. After that, he moved to Monitoring and Evaluation for the coast region of World Vision Kenya. A year later, Stephen became the program manager overseeing all World Vision development programs for coastal Kenya. He joined KADET, which is owned by World Vision, in 2007 as the manager of Integration and Donor Relations.

John Briggs is a Kiva Fellow serving with the Kenya Agency for Development of Enterprise and Technology (KADET) (KF8). Before being posted in Kenya, he worked with Kiva field partners Ahon Sa Hirap, Inc. (ASHI) (KF7) in the Philippines and Maxima Mikroheranvatho (KF6) in Cambodia.

By Courtney Kemps, KF8 Peru

Earlier this week I accompanied Maribel, director of Manuela Ramos’s Pucallpa office, and Liz, one of the loan officers, to an informational meeting for a new group of borrowers that turned out to be more of an adventure than any of us had expected.  We rose early Monday morning to take a long wooden boat from Pucallpa’s port up the Ucayali River to a tiny town called Nuevo Paraiso (New Paradise).  It was Manuela Ramos’s first visit to New Paradise, a town populated by indigenous Shipibo-speaking people who had heard about the possibility of receiving loans from Manuela through a radio advertisement put out by the Pucallpa office last year.  The town of New Paradise, consisting of a series of wooden homes which line a single wide dirt road, is accessible only by boat and will soon be the furthest community served by Manuela’s Pucallpa office.

The adventure began with the harder-than-expected task of simply trying to figure out how to get to New Paradise.  Liz and I walked up and down the mud banks of Pucallpa’s incredibly dynamic, chaotic port asking which boat would take us there.  Each person we questioned pointed us in the opposite direction of the one we had asked immediately before.  After half an hour of this, we finally managed to find the right boat.  Once on board, every time the boat stopped at some point along the river we had to ask if we had arrived at New Paradise.  Four hours after embarking we pulled up to a completely nondescript riverbank, unmarked by anything that would indicate a nearby settlement.  Upon leaving the boat we discovered that we still needed to walk 45 minutes through a series of banana plantations to reach the town.

Pucallpa's port

Our meeting finally began around 2:00 pm after an announcement over a loudspeaker had gathered about 40 interested women in the town’s main square, comfortably shaded by a group of very large mango trees.  Maribel began an animated presentation about what Manuela Ramos would do for the new group of borrowers and what the MFI expected from them in return.  Early on in her presentation Maribel asked the audience what they understood by the verb “to invest”.  After a minute of shy silence followed by some additional encouragement from Maribel, a dialog began.  Maribel used this dialog to segueway into a discussion of the secret to succeeding in any business: working very hard.

The people of New Paradise are almost exclusively banana farmers, although they also grow some corn and beans.  Each day long wooden boats like the one that brought us to the town make the trip downriver to Pucallpa laden with heavy cargoes of bananas from the townspeople’s plantations.  Before and after the meeting, Maribel asked detailed questions about harvesting cycles, land use, earnings, and how the townspeople are finding markets for their produce.  In the course of her questioning, Maribel learned that many of the townspeople are also receiving loans from ADRA, another microfinance institution serving Peru.  The next steps in getting this group of borrowers started with Manuela will include placing a call to ADRA and then assessing each potential borrower individually.  Maribel needs to check with ADRA to make sure the townspeople have been able to pay back their loans so far—she doesn’t want to overload them with additional credit from Manuela if they are already struggling with their current loans.  Next week Liz will return to the town to conduct individual borrower assessments.  If all goes well, the women of New Paradise should have their first loans from Manuela Ramos sometime next month.

River boat laden with cargo

After our meeting ended we quickly returned to the spot where our boat had left us in order to catch a ride back downriver to Pucallpa, which the townspeople had assured us we would be able to do.  For the last two and a half hours of daylight we frantically waved our fluorescent orange life jackets up and down, trying to catch the attention of the few boats cruising toward Pucallpa down the wide, brown expanse of river.  As darkness approached and no boat stopped, we realized that we were going to have to spend the night on the riverbank. Although we were all quite dismayed by this situation, failing to find return transport did give us the chance to watch a small group of pink Amazon River dolphins languidly hunt fish near the shore in the hour before sunset.

Fortunately, Don Javier, an elderly fisherman who lives alone in a small, partially open-sided wooden hut hidden among banana trees about a hundred feet from the riverbank, offered to put us up for the night.  He appeared quite happy for the company.  After a dinner of boiled green bananas and a delicious fish from the river, the three of us squeezed under Don Javier’s one spare mosquito night.  It was a very tight fit, but certainly better than sleeping outside where swarms of mosquitoes buzzed like a small army.  The lack of electricity and the threat of mosquitoes kept us under that net for 12 long hours of darkness (the sun sets at 6:00 pm around here).  We were very fortunate to flag down a boat headed to Pucallpa at around 8:00 the following morning.

View from nearby Don Javier's home

I hope this little story gives an idea of the dedication of Manuela Ramos’s Pucallpa staff to bringing their programming to harder-to-reach communities.  To learn more about Manuela Ramos’s microfinance program, click here.  To view a list of Manuela Ramos’s current fundraising loans on Kiva’s website, click here.

As I described in a previous blog post, EDESA (Kiva’s field partner in Costa Rica) works with a network of Community Credit Enterprises (ECCs by their Spanish acronym).  To reiterate a bit, the ECCs are small, grassroots microfinance organizations formed by rural community members.  FINCA Costa Rica provides extensive training in these communities to teach members how to work together to create and run a profitable business that provides financial services among other things.  I recently visited one of the oldest and largest ECCs, La Asociación de Productores de El Sauce (The Association of Producers of El Sauce – El Sauce for short). 

This ECC is a phenomenal example of what people can do with just a little money, a little training, and a lot of motivation.  The El Sauce ECC started about 17 years ago with only 13 members and no money.  They quickly grew to 23 members and Finca provided them with their first loan: just over US$1,100 to invest in farming projects across all the members.  Over the years they have grown steadily and currently have 136 members holding 531 shares and have given a total of 2,062 microloans. 

The beauty of the El Sauce ECC, however, is not just the manner in which it has provided financial services to the community, but how it has used the foundation of the ECC to expand in many ways.  As the enterprise became profitable, the members decided to reinvest some of the profits in establishing a formal office and purchasing equipment such as computers and printers.  Now, in addition to providing loans, the El Sauce ECC office serves as an internet café, photocopy and printing center, classroom for computer courses taught by a local Peace Corps volunteer, and more.  This not only provides useful services to the community, it also generates more income for the ECC, which can be utilized to provide more loans, other services, and/or dividends paid out to the members. 

But some members didn’t stop there.  Building off the idea of pooling resources to create a business for everyone in the community to benefit from, 10 members recently formed a diary producers cooperative.  They have constructed a small cheese factory where local farmers can bring their milk to sell.  The milk is then made into cheese and sour cream, which have a much higher resale value, thus generating more income for the local farmers.  The factory also employees four people in cheese production. 

FINCA’s goal is to equip rural Costa Ricans with the knowledge and skills to form a successful enterprise.  They teach the power of collaboration and of pooling resources.  The community of El Sauce has applied these invaluable lessons on so many different levels and members are regularly investing in initiatives that will continue to grow and provide benefits for years to come.  EDESA and Kiva are providing additional financial resources to these industrious entrepreneurs to help facilitate this growth.  It truly is an amazing thing to witness!

Follow these links to see the borrower profiles for a few of the Kiva borrowers from El Sauce.  Make sure to scroll down the page to read the journal updates and watch more short videos of their work. 

Hector Jimenez Gutierrez

Jose Andrei Alvarado Calderon

Danny Villalobos Rojas

Olman Quesada Varela

If you’d like to hear more about microfinance in Costa Rica, join the EDESA lending team, Pura Vida Costa Rica.    Also be sure to visit this link regularly to see any fundraising loans for Costa Rican microentrepreneurs.

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Megan Tatman Montgomery is in her fourth and final placement as a Kiva Fellow.  Prior to EDESA, she served at Friendship Bridge and FAPE in Guatemala and ADEPHCA in Nicaragua.  Please feel free to contact her at megan.montgomery@fellows.kiva.org with any questions, comments, or requests for future blog posts.

Athan Makansi – KF8 – Apia, Samoa

Jump on the Samoan time machine and watch as a few neighbors help prepare a delicious meal of taro, breadfruit, coconut cream, potatoes, chicken and tuna in a giant fire pit as Samoans have for many, many years.  But no, Samoans don’t make s’mores.

Talofa (Hello), from Samoa.  I arrived last Friday in the glorious sunshine of Samoa, eager to start my fellowship with SPBD, Kiva’s partner in Apia, the capital (and only) city.  Very quickly I became aware of a remarkable generosity between Samoans.  My landlord offered to cook for me, a taxi driver gave me a free ride, and all types of Samoans generously flashed a toothy smile my way.  In every instance of generosity I can’t help but let a smile sneak out in return.

My biggest smile of the past week came when my landlord, Margaret, and her son, Francis, welcomed me and her other residents with an “umu,” a traditional Samoan meal prepared in an earth oven.  A family or in the case of smaller villages, an entire village comes together to prepare the meal before church on Sunday.

The traditional “umu” process is quite laborious.  According to Francis, the chefs wake up around 6:00am to begin cooking.  They start by building a large bonfire and placing large rocks in the flames.  While the rocks heat up, the bananas, taro and breadfruit are peeled and washed.  Preparing the food is an art.  Expertly, the potatoes are chopped, the coconuts scoured into thin strips and the meats spiced.  Banana leaves carefully are stuffed with the coconut milk. Before church everything has been placed gently among the hot rocks.  Even though our meal was only for eight people, our master chef emerged from around the fire pit sweaty and tired.  It’s certainly no leisurely summer cookout.  The lounging comes later.

After attending church, Samoans return home to happily find their feast cooked and ready to eat.  For families it’s a way to catch up with the neighbors, entertain guests and show off your cooking skills.  Until bedtime, Samoans spend the rest of Sunday loafing about.  In proper Samoan fashion, we basked the sunshine, drinking cold Coca-Colas and letting our overstuffed bellies rest.

Athan, KF8 (Kiva Fellows 8^th Class), is currently serving his fellowship with South Pacific Business Development in Samoa.

By Sloane Berrent, KF8, Philippines

As a Kiva Fellow, drinking the Kiva kool-aid and eating, living, breathing Kiva day-in and day-out, my browser is full of tabs following Kiva online. I wanted to share those ways to connect with you. So you too, can friend, follow, subscribe and join away!

Blogs:

• Kiva Fellows – a great place to read all about the stories, experiences and reflections of the approximately 40 Kiva Fellows that are currently in the field.
• Kiva Blog – To read about happenings from Kiva HQ including new country launches, partnerships and resources for ways to get more involved with Kiva.

Facebook

• Become a Fan
• Support the Cause

Twitter

• Kiva
• Kiva Fellows
• BuildKiva

YouTube

• Kiva
• Kiva Fellows

LinkedIn

• Kiva Group

Phew! Is there anything I’m missing? Is there anywhere you’d like to see Kiva online that isn’t listed here? Thanks and happy connecting, see you around the Internet!

Sloane Berrent, KF8, is currently serving her placement with Ahon sa Hirap (ASHI) in the Philippines. She is learning to love, or at least not visible cringe from, love ballads from the ‘90s, the de rigueur music choice in every taxi, tricycle, jeepney, café and restaurant experienced thus far. When better “connected” you can find her promoting Kiva on Twitter and writing about social action campaigns on her blog, The Causemopolitan.

By Nancy Tuller, KF8, Ghana, Africa

I have a professor and mentor from my undergraduate days whose advice and thoughts I value and respect so much.  I still communicate with him regularly, and over the years, the topic of interest rates in microfinance has come up repeatedly in our conversations.  This is the man from whom I first learned about community currency, an alternative exchange system used alongside national currencies.  He is knowledgeable about micro and macroeconomics, as well as finance.  However, our conversations about interest rates for microloans always end the same way:  with me, for the most part, defending the rates charged for microloans, and with him maintaining that the rates are most often too high.  I think I finally have the words to support my position, and I offer them up to you all.

It seems I’ve always intuitively known that if you want to be in the business of giving very small loans to the poor, your expenses are going to be higher than if you are a financial institution that works with middle to high income clientele.  If you want to continue providing basic financial services to the poor you must have a sustainable operation, with an ability to cover all your expenses and generate funds to lend as well.  Many microfinance institutions (MFIs) rely on donor funds to stay sustainable, and I would even venture to say, without the statistics at my fingertips, that the majority of MFIs begin operations this way.  Many are not able to wean themselves from donor funds.  But relying on donor funds has its own cost, in terms of meeting donor needs, reporting back to donors, and the very real threat of MFIs losing sight of their own missions by putting their financial viability (and sometimes donor missions) at the top of their priority list.  The more recent trend in microfinance is to move away from donor funds and seek financial sustainability as quickly as possible.  Scaling up the business by adding more borrowers is a step in this direction, and there are certainly MFIs, who once they have reached a financial comfort level, have lowered their interest rates.  However, that comes with time and sustainability.  The first goal, before lowering interest rates, is financial self-sufficiency.

One thing that is really important to acknowledge is that different country contexts present different challenges to meeting financial sustainability for MFIs.  For example, Kiva recently launched its first loans to borrowers in the United States.  One of the MFIs offering these loans, ACCION, charges an interest rate of 12% APR.  That may seem on the reasonable end to many from the US.  However, at least here in Ghana, and I suspect it is true for the majority of developing countries, 12% is considered a steal!  The Central Bank of Ghana charges 18 % APR on loans, and commercial banks in Ghana charge (depending on what type of business loan it is) from a very rare 21% APR (for a construction loan) to a high of 83.31% APR.  The common range would be from approximately 32-38% APR.  (See these figures on The Central Bank of Ghana website: www.bog.gov.gh.)  For a country with a low GDP, in which government revenues are low, and the economy is slower, the lack of money circulating makes it a lender’s market.  I would definitely qualify 83.31% as falling into the category of greed.  But the average rates that commercial banks charge would generally give them no more profit than a bank in the US.  Most importantly, when an MFI, like Sinapi Aba Trust (the one I am currently working with in Ghana) charges 36%, it must be understood that its expenses greatly exceed those of a commercial bank, and its revenue stream is more like an extremely slow trickle.  Sinapi Aba Trust (SAT) is a financial NGO, and as such, is not legally allowed to accept deposits.  Such deposits are a major source of revenue for banks that hold the savings of middle to high income clients.  In fact, SAT pays other banks to hold its money in current accounts, from which it lends money and pays its own operational costs.  It also pays interest on the money it borrows from other banks to lend to its clients (though it does not pay interest on the money that it receives from Kiva lenders which goes to only a portion of SAT’s clients).  In addition, MFIs like SAT must meet the costs of providing the services that they render, which are generally much higher than commercial banks.  Consider that it costs the same to process a loan for $7,000 as it does for a $700 loan.  Yet the $7000 loan generates a far greater return through interest payments than the $700 loan.  And what commercial bank loan officers will come and find you at your place of business to collect your payment so that you don’t have to take time out of your working day to run down to the bank?  Which commercial banks will send a loan officer out to your place of business to get an update on how your business is doing?  How many of them offer business training or literacy programs or any number of other services that many MFIs combine with their financial services?  Most MFIs bring the banking operations to the loan clients at village meetings or even their homes or businesses, where clients apply for loans, are assessed, trainings are often given, loans are disbursed, payments are received, interviews to assess impact are conducted, and so on.  All of this takes time, and time equals money in the form of salaries for loan officers, who then return to the office and upload all data into computers or ledgers, and in the form of transportation to remote villages that can be hours or days (then hotel bills must be included) away from their headquarters.  Add to these costs the brick and mortar expenses—overhead of operations.  And in a country like Ghana, where the Ghanaian currency is depreciating on a daily basis, all these costs increase daily.  And remember that purchasing power varies greatly among countries.  Most, though not all, organizations offering microfinancial services fall into the non-profit category, wherein their positive profit margin is reinvested into their operations.  SAT constantly struggles to remain financially stable while not compromising its mission “to serve as a mustard seed through which opportunities for enterprise development and income generation are given to the economically disadvantaged in society.”

Yes, my friend and mentor, in a perfect world there would be no interest charged, a system that makes the rich richer and the poor poorer.  However, the poor need financial services now…not in the idealistic future.  What seems to you to be high interest is a Godsend to the poor in most of the developing world.  Their economies are not mini-replicas of the US economy, where despite the recent economic turmoil we have enjoyed a relatively stable and secure economy that has allowed us to enjoy comparatively low interest rates.  The evidence that the interest rates charged by MFIs are for the most part fair is reflected in the overall success of microfinance operations around the world.  The poor see these microloans with accompanying interest to be their best opportunity for rising above poverty and improving their quality of life.  Remember that with most MFIs, collateral is not required, as it is with commercial banks.  Without microloans, the poor might be paying triple the amount of interest or more to the local moneylender, with the result of sinking even deeper into debt.  Repayment rates on microloans far surpass the repayment rates at commercial banks worldwide.  And clients are motivated to repay through plans that allow them to take out successive loans in higher amounts every time they finish paying off a loan.  In order to stay in business, MFIs must charge enough to cover their expenses.  I’m not trying to make the case that microfinance is perfect.  It’s not.  It is not the answer to poverty alleviation all by itself.  It doesn’t always work for every loan client.  There are defaults and business failures and fraudulent practices by MFIs going on (including charging excessive interest rates).  What works in one context won’t necessarily work in another.  Perhaps the real evidence that proves that interest rates are reasonable for the most part, even when they seem high from a western perspective, is reflected in the countless stories of grateful loan clients whose lives have positively changed as a result of the microloans they have received.  Be it in Bangladesh, Peru, Indonesia, Tajikistan or Ghana, loan clients have come forward, many in these pages, to tell their stories of hardship to hope—of desperate need to grateful success.  Read on…

To learn more about Sinapi Aba Trust and its work, go to http://www.kiva.org/about/aboutPartner?id=88&_tpg=fb

To join the Sinapi Aba Trust lending team and loan to a deserving Ghanaian entrepreneur, go tohttp://www.kiva.org/team/sinapi_aba_trust_ama_anidaso&_tpg=fb

Joel Carlman – Kisumu, Kenya – KF8

Hello from Kisumu, Kenya! After 36 hours of flying and several very sound nights of sleep, I’m writing you from the offices of Kisumu Medical and Education Trust (K-MET), our Kiva field partner! I say our because I have the privilege of working alongside my wife, Alison Carlman throughout our Kiva Fellowship. What an experience!

After arriving at the tiny Kisumu airport on Monday evening, we were able to settle into our temporary housing on the K-MET “complex.” We were in a bit of a daze from the sleepless flights and harrowing airport encounters trying to convince airport personnel in every country that we traveled through that they should exempt us from the charges levied on overweight baggage. Since when is 30kg a person overweight!?

Moving on.

The Kenyan experience thus far has been wonderful. From Ekesa, the administrative manager who picked us up from the airport, to the administrative staff, to John Asuke, the director of the revolving loan fund, to the staff at the field offices—everyone we have encountered at K-MET—and in Kenya in general—has warmed our hearts to an unexpected extent. We are so excited to be able to work with this group of exceptional people!

I have to say, I feel so blessed to be working with my wife, Alison! We have been lucky to volunteer together on several continents, but I’m sure our Kiva Fellowship will prove to be our biggest adventure yet. The people we will meet (and have already met), the adventures we will live, the challenges we will face, and the growth we will experience will no-doubt conspire to change us. These times stretch us, inspire us, encourage us, and even sometimes defeat us. But, when all is said and done, I am so excited that the growth Alison and I will experience will be in the same direction. It is one of the greatest opportunities for our marriage that I can imagine. Thanks, Kiva, for affording us the chance to walk this road together!

With that said, Alison and I have tried to imagine a scenario in which two married fellows can synergize to accomplish more than the sum of our parts. Wish us luck, as we definitely have big shoes to fill! The recent fellows that have paved the way for us—Brett Dobbs, Milena Arciszewski, and Sarah Forbes have pioneered programmes, established relationships in the community, helped K-MET to become more sustainable, and otherwise established themselves amongst the ranks of Kiva Fellow All-Stars. They deserve a huge hand for going above and beyond the Kiva call of duty.

As reported in many previous blog entries, K-MET is an organization that affords a unique look into the organic outpouring of the hearts of people passionate about development, health, and education. They have been able to leverage micro-finance in a very unique way, and we are excited to both learn from and contribute to this organization. Watch this space for the further adventures of the Carlman family in Kenya!

Joel Carlman is in the fourth day of his Kiva Fellowship. Click here to find out more about the Kiva Fellows program and here to find out more about what K-MET is doing in Kisumu, Kenya.

At the fellows training some of my companeros seemed shocked that I’d want to do a fellowship in one of the most expensive cities in the world. I have to admit, I admire the cost of a Terere in Paraguay compared to price of latte in NYC. Regardless, it’s been an incredible experience to participate with Kiva on the US launch.

In many ways the fellowship, the entreprenuers, even New York City itself has at times seemed enormously comparable to a fellowship in a developing country (I mean have you used the subways here!!!???).  But about the cause…

Why US microfinance….

By launching in the United States, Kiva is creating a local lending place for global thinkers. By supporting US microfinance and organizations like ACCION USA, you are supporting community.

Kiva lenders want to support individuals around the globe that work hard to support themselves and their families. These entrepreneurs also dream of creating legacies. Kiva is helping to provide equal access to capital for business owners that,  regardless of the country they live in, have struggled to obtain the credit elsewhere.

I believe that by supporting a US business on Kiva, we truly understand the goal of microfinance- and we are balancing the scales to open up opportunities for everyone.

Trinidad wanted to start a daycare, a bank turned her away, a loan shark almost lured her… instead a pool of individuals on Kiva helped to make her dream reality.

Sustainability is one of Kiva’s principles.  Who can argue that sustainability isn’t needed in the US?
Kiva lenders are supporting sustainable businesses, building communities and helping to create legacies- 25 dollars at a time.

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Erica Dorn is currently serving at ACCION USA.  erica.dorn@fellows.kiva.org

Support U.S. Microfinance and check out all of the entrepreneurs requesting loans from ACCION USA- each has a story to tell.

Learn more about the US Microfinance cause.

In a desperate last-minute attempt to get my name off the top of the “least-blogging fellows” list and fulfill my grandma’s request for more blogs, I’d like to share some of my favorite photos from my 10-week placement at Asociacion Arariwa in Cusco, Peru.

Arariwa is an amazing organization with an extremely dedicated group of loan officers. I was consistently impressed with loan officers’ dedication to their clients—not just putting in long hours for little pay and running risks by carrying cash, but in some cases even relocating to remote villages in order to serve clients without previous access to financial services. For example, Tula Barazorda and Armando Cabrera live and work in Pilcopata, a remote jungle town that’s 8+ hours from Cusco on rough, narrow dirt roads. Pilcopata is a sleepy little town where there’s little to do but shoot the breeze and swat the mosquitoes. One morning – over breakfast, no less – Tula and Armando had a long, nonchalant conversation about all the different kinds of bugs that can burrow under your skin, how to tell the difference, and the pros and cons of each one (never before have I been so grateful to my parents for raising me in Minnesota, where all we have is ticks).

All in all, my time at Arariwa was an incredible experience, and I’m already itching to go back and visit. I’m also looking forward to reading much more frequent blogs from my Arariwa successor, Lee Bruner!

To see all currently fundraising loans from Asociación Arariwa, click here.

Cynthia McMurry is a fourth-time Kiva fellow working with brand new Kiva field partner Fundación Espoir in Quito, Ecuador. Previously she worked with Fundación AgroCapital in Bolivia and FINCA Peru and Asociación Arariwa in Peru.

Ashley Nelsen KF 7/8 Nicaragua

The latest news from Nicaragua has unfortunately been the decision by the United Nations to cancel $62 million dollars worth to funds destined to assist in the Millennium Development Goals (MDGs). The MDGs are eight goals created by the United Nations to combat some of the developing world’s most pressing problems such as improved access to education and health. The decision to revoke the funds is a direct result of electoral fraud that occurred last fall during the mayoral elections. People were denied access to vote, votes were not counted, and many of the international watch groups were denied full access to oversee the electoral process.

It was therefore determined a fraud by observers from the European Union, the Carter Center, and the Organization of American States. While the fraud is old news, the cancellation of funding has been in the headlines since the announcement was recently made. Taxi drivers, store owners, co-workers- anyone who can get my attention seem to want to tell me, the foreigner, how embarrassed and worried they are that their government has allowed this to happen.

The cancellation of funds and an expanding economic crisis has left the majority of Nicaragua’s poor without a support system. In a country where 45% of the population lives on less than $2 dollars a day, it is important that Kiva lenders continue to support Kiva loans and other forms of development in Nicaragua. Clients of ADIM, the MFI where I currently work, used to tell me that their business goal was to “expand their business,” now the answer I regularly get is to “survive the economic crisis.”

Crater lake and volcano in Nicaragua

To support current ADIM loans currently fundraising please click here: http://www.kiva.org/app.php?page=businesses&partner_id=120&status=All&sortBy=New+to+Old

For more information on the electoral fraud in Nicaragua please read: http://www.economist.com/world/americas/displayStory.cfm?story_id=12607338

By Nick Cain, KF7 Paraguay

In Cochabamba, Bolivia, milk is quite literally the ticket to financial services and economic growth.  Kiva lenders, meet CIDRE, your newest Field Partner in Bolivia.  Last week I traveled from Asunción, Paraguay to Cochabamba, Bolivia to train CIDRE’s staff members on the Kiva platform, help them learn a little about the Kiva community, and make sure they had everything they needed in order to start connecting their borrowers to Kiva lenders.

A panoramic view of Cochabamba

The staff was enthusiastic to get to work and learn more about Kiva, so Day One of my visit was all training sessions and PowerPoints.  But on Day Two, CIDRE’s new Kiva Coordinator, Diego Cardona, and I set off for the outskirts of Cochabamba to meet some borrowers.  Most of CIDRE’s loan products are geared to serve the region’s dairy farmers, a community of micro-entrepreneurs who own anywhere from 5 – 25 cows and earn income by selling milk to Pil, the region’s lone dairy corporation.  Cochabamba’s dairy farmers are concentrated in a large swath of land behind the city’s airport.   About 10 minutes after leaving CIDRE’s offices in the city center, paved roads gave way to a lumpy, dusty web of cinder-block houses and muddy cow pastures.  Eventually Diego and I came to a stop, eye-to-eye with a couple of rather hefty bovines.

Outside the home of one of his clients, Diego told me a bit more about how dairy farmers are able to access CIDRE’s financial services.  It was a classic lesson in how the microfinance industry finds innovative ways to bring credit to those who are usually shut out of the financial system.  Without bank accounts or formal financial documents, receipts or tickets from Pil are the best and often only way that the farmers can prove their income.  CIDRE’s loan officers told me that these tickets, which show how many liters of milk a farmer sells to Pil each month, are critical to the evaluation of each borrower’s eligibility for a loan.  Depending on their income and other assets, most farmers are also required to put up some or all of their cows as collateral for the loan.  Thus, for every new client, loan officers have to make the rounds at the cow pasture, snapping photos of each animal to ensure that CIDRE can tell them all apart.

Kiva Coordinator Diego Cardona documents collateral for a client's loan

With access to a loan, CIDRE’s clients are able to buy more food for their cows or invest in new animals, both of which can be leveraged into higher milk production and an increase in income.  According to Diego, CIDRE has found that farmers who are able to acquire 10-12 cows or more are most likely to increase their income, while those with fewer tend to make just enough money to sustain themselves and their business.  By tapping into the funding made available by Kiva lenders, CIDRE will be able to extend their reach even further into Cochabamba’s dairy farming community.

I hope you’ll join me in welcoming CIDRE to the Kiva community.  Their first set of loans should be up on the site soon, so keep an eye out for those cows!

Nick Cain recently finished a 16-week placement with Fundacion Paraguaya.  He promises to still wear his Kiva t-shirt when he gets home.

Posted in All, Bolivia, CIDRE, KF7 (Kiva Fellows 7th Class) Tagged: blogsherpa, Bolivia, CIDRE, cochabamba, dairy production in bolivia, kiva in bolivia, microfinance in bolivia, nick cain ]]> http://fellowsblog.kiva.org/2009/06/16/the-cows-of-cochabamba/feed/ 4 nickcain Cochabamba, Bolivia COW ID Extra Income Cochabamba's Most Famous Landmark http://fellowsblog.kiva.org/2009/06/15/through-sickness-and-in-health/ http://fellowsblog.kiva.org/2009/06/15/through-sickness-and-in-health/#comments Mon, 15 Jun 2009 11:51:42 +0000 Sloane Berrent http://fellowsblog.kiva.org/?p=5018 ]]>

My First Center Meeting with Antique Southwest Group

By Sloane Berrent, KF8, Philippines

Just five days into my Kiva Fellowship, one thing I already know, this is truly an amazing experience, no two ways about it. I am learning things, going places, meeting people that never in a million years would a normal traveler experience.

It’s also quite frankly, hard. This isn’t like jaunting in my solo travels around the world, being carefree and on my own schedule, meeting fellow travelers on the road and taking my own adventures at every turn. It’s a hard mattress on the floor, a cold shower that consists of filling a bucket with water and throwing cups of it over my shoulder and in my hair, it’s no air-conditioning and tossing and turning at night in my sleep waking up sweating. It’s spraying copious amounts of bug spray and those suckers still getting my ankles, my knees, the back of my neck. It’s taking multiple forms of transportation every day, on this motorbike, off that jeepney, into another taxi. It’s SLOW and unreliable Internet when all I want to do is post a blog post like THIS and respond to the most urgent emails and be done with the computer again for the day. But fighting for each page load. It’s meeting new people every day and they are so excited to meet me and I have to fight through the heat and exhaustion of all of the above and show the same enthusiasm back.

It’s hard. It’s also, in just under a week so deeply gratifying in the most pure and honest way I could ever describe.

It’s tears brimming in my eyes multiple times a day getting out in the field and meeting woman after woman who has benefited from my field partner, ASHI. It’s learning about microfinance in this region and meeting some of the most committed and passionate people I’ve ever had the privilege to come in contact with who chose to work at an NGO despite the long hours and lack of pay because they believe in the power of microfinance. It’s walking through villages, up hills and through fields to meet borrowers in their homes who always accept us with open arms and enthusiasm. It is these women who tell me how they’ve been able through one loan after another to slowly be able to send their children to better schools and afford college. It’s seeing the camaraderie in women who tell me that before ASHI (and in turn Kiva) they were shy and didn’t know their neighbors.  It is these women who tell me that being part of a group of borrowers they are now like sisters and they are accountable to each other through sickness and health. It’s hearing about how they have a positive view of the future for their children. They tell me this all the while talking and laughing louder than the woman sitting next to them. These women shy? I truly can’t believe it.

It’s hard. It’s gratifying. It’s also beyond educational as I find myself daily in intense conversations about microfinance, sustainability and the future of the fight to eradicate poverty.

Yes there is a lot of hard work ahead, many more women to meet, and many more stories to hear, verify and retell to you. There are battles with internet connections as I try to report back to Kiva my findings. There is brewing an internal struggle coming to grip with a newfound respect for the word “patience” as I hurry up to make it places on-time only to wait in the maze of the Filipino word for anywhere between 5 minutes from now and 3 hours called simply “later.”

In the words of Helen Keller, “Life is a daring adventure or nothing,” As adventures go; this one has already paid for itself ten times over. Thank you for joining me on this journey, I’m excited to share much more of it with you.

Sloane Berrent, KF8, is currently serving her placement with Ahon sa Hirap (ASHI) in the Philippines. She is learning to love, or at least not visible cringe from, love ballads from the ‘90s, the de rigeur music choice in every taxi, tricycle, jeepney, café and restaurant experienced thus far. When better “connected” you can find her promoting Kiva on Twitter and writing about social action campaigns on her blog, The Causemopolitan.

¡La selva no se vende, la selva se defiende!

“The forest is not for sale, The forest we defend!” shouted the community of Ayacucho while pumping their fists in the air.  Sweat dripped down their foreheads in the midday sun and not a soul was dressed for a day at the office.   The spirit of the crowd was overwhelming, as if every person had their heart invested in the political crisis unfolding in Peru, no matter its geographic distance from here.

Hours after my arrival in Ayacucho on Tuesday, while I was still entranced by the cultural beauty of the place and struggling for air due to altitude, I was told the roads into the town were to be closed at midnight, and water and electricity might be shut off.  The other volunteers at my MFI and I joked that the Peruvians were hazing me – the newest guerita in town.

In the Bagua region of Peru, an area where life is sustained by the Amazon’s great forest, live many indigenous people who have subsided on local hunting for generations.  Far away in the urban metropolis of Lima, Peruvian President Alan Garcia has been coming up with a plan for Peru to have freer trade and more room for foreign corporations, at the request of the U.S.  Two bills were created that would allow thousands of square miles in a formerly protected area of the Amazon rain forest to be for sale – which could indicate logging and/or a foreign oil company.

The indigenous have been rioting.  They feel that their rights are being ignored, as this is an area they consider their own.  The other side, including many urban dwellers, see the indigenous as unfairly resistant to change and purposefully difficult to negotiate with.

Another chant begins.

“Pueblo Amazona, Ayacucho esta contigo!”

Amazon region, Ayacucho supports you.  Ayacucho can relate to the plight of rural farmers and indigenous communities often ignored and forgotten by the national government.  And once they heard of the violence from the conflict last Friday – over 30 indigenous killed and hundreds more missing – it became a personal call to action.  Further fanning the flame is a rampant rumor that the missing indigenous were killed and thrown into the nearby river by the police in order to cover up their deaths.

Two decades ago, the socialist terrorist group Sendero Luminoso ruled the region and city of Ayacucho.  If you went out past 8pm, you would be killed by either the military or the terrorist group, as they assumed that by being out late you must have been doing something for the other side.  Over 40,000 people disappeared in this area.  Virtually every single FINCA Peru borrower in this area lost a loved one.  Wives awoke in the middle of the night to their husbands being taken, never to be seen again.  Many teenagers here do not have fathers.

Ayacucho’s heart is invested in Peru’s indigenous in the Amazon region: they’ve closed their markets and businesses the past two days, and those that had to work protested by wearing civilian clothes – even at FINCA.  The streets have felt barren and boarded up.

Yet the most entrancing moment of the protest was watching a Peruvian woman climb up to the megaphone and tell the story of the day she never saw her husband again.  She spoke in Quechua with power and a strength that simply transcended the language barrier.

This tiny little town’s protest might not make the national Peruvian news, nor is this crisis in general making headlines internationally without hunting through websites to find news pertaining to South America.  As I watched the crowd overcome with emotion, I became overwhelmed and encouraged that Kiva allows its Fellows to share the resilient life stories of our Kiva borrowers on this blog.

It brings tears to my eyes to see an elderly woman, with four grown children, get excited about her next loan – twenty years after her husband’s life was taken.  It brings tears to my eyes that her daughter sits next to her, breastfeeding her newborn, and counting out their next loan payment, literally juggling everything in her hands.

My heart has been pounding to get this story out.

Thank you, Kiva, on behalf of the rural campesinos in Ayacucho and in Peru’s Amazon, who’ve lived through the unimaginable, for letting me tell their story.

Because “justice is what love looks like… in public.” –Dr. Cornel West

Click here to make a loan to a borrower at FINCA Peru.

Suzy Marinkovich is a Kiva Fellow at FINCA Peru in Ayacucho, the first of her three placements.  She has a wholehearted passion for microfinance, social justice, and poverty alleviation.  Suzy is most excited to listen to the incredible stories of Kiva borrowers in South America and let them know how much they continually inspire us all.

This Wednesday marked a watershed moment for Kiva.org: borrowers from the U.S. made a well-publicized debut on the person-to-person microlending website. It left no doubt that microcredit, seen by many as the province of the poor, had arrived to serve Americans in need.

The floodgates are open, and they sluice both ways.

Kiva’s launch of lending in the U.S. has impassioned many, including a group of people in Cambodia near and dear to me — the staff of Maxima Mikroheranvatho, a Kiva partner microfinance institution where I was a Kiva Fellow from October 2008 to February 2009.

As Kiva ambassador-in-the-trenches at Maxima, one of the things I’d tried to impress upon them was the satisfaction I get out of being a Kiva lender. So when my posting at Maxima ended earlier this year, I’d settled on the perfect gift to help them understand this: a Kiva gift certificate.

Over our farewell dinner in Phnom Penh, I pulled out a printout of the Kiva gift certificate page and presented it to the senior managers at Maxima. As they’re in the business of microlending, minor disbelief ensued. Kiva!? Who would they lend to? When I told them that Kiva was considering launching in the U.S., excitement erupted.

This week, the people at Maxima finally got to redeem their gift certificate. They chose to lend to Amato, a woman with a child care business who lives in Fremont, California that is an Opportunity Fund client. Bunhak An, Maxima’s deputy executive director, wrote me to explain how he felt about Maxima becoming a Kiva lender. A gently edited version of Bunhak’s email follows:

Dear John,

I would like to inform you that we like to lend on Kiva, as we know that Kiva is best and first website to initiate idea using technology to help the poor around the world (especially our Cambodians) to bring lender and borrowers together.

We think this is our opportunity to help people around world. Kiva’s mission is a journey, not the destination. Kiva is now helping American people, just as it as helped our Cambodian poor a lot via Maxima and other MFIs. Kiva was there before the economic crisis and still continues to help.

When we click lend, we feel proud to help people really need money for business. We chose to lend Amato, because she is a widowed mother of two, has always loved children and believes her mission in life is to help them. Women and children are the first priority in my mind, as well as clients that Maxima targets. We will continue to lend more as we have committed within our management and staff to have the art of contribution.

We pay thanks to Kiva and its founders, and encourage Kiva to continue its great mission to build a world without poverty.

Regards,

Bunhak An

It was a proud moment for all of us.

To me, Kiva’s decision to help facilitate lending to borrowers in the U.S. doesn’t mean that microfinance funding will dry up for people in places with the most acute need, or that Kiva will markedly shift its focus from the developing world. It’s just recognition of the fact that there’s need everywhere, even in the nation that boasts the largest economy on earth.

I’ll be keeping an eye on Maxima’s Kiva lender page to find out who they might loan to next.

Maxima staff and Kiva Fellow at the Phnom Penh head office, January 2009. Bunhak An is in the rear row, third from right.

John Briggs is a Kiva Fellow serving with the Kenya Agency for Development of Enterprise and Technology (KADET) (KF8). Before being posted in Kenya, he worked with Kiva field partners Ahon Sa Hirap, Inc. (ASHI) (KF7) in the Philippines and Maxima Mikroheranvatho (KF6) in Cambodia.

Four weeks ago I left my first placement in Cambodia and came to the Philippines where I started my second assignment with Kiva Field Partner ASKI. With each day at ASKI I have been more and more impressed by the dedication of the staff and the amazing programs that they are running.

Last week I started working on a blog post where I plan to conduct video interviews with staff that work on what ASKI calls, their “Beyond Microfinance” programs. These programs include; health insurance, life insurance, community development, housing loans for government built low income housing units, marketing training, finance training and a whole foundation that provides everything from child care to scholarships to toilets.

As I began to research each program’s operation it became obvious that each one of them were a testament to the staff’s tireless efforts to serve their clients in every possible way. Most of the programs are funded directly through profits earned in their core micro credit business, which I thought was an incredible use of profits. There was something else I discovered that struck me as well; many of these programs would not be possible without partnership with or support from the Filipino government.

I found that the health insurance, life insurance and housing loan programs are in direct partnership with the government, and the community development program helps villages work with the local government to complete valuable infrastructure projects.

I immediately thought back to my time in Cambodia and I asked myself:

Even if a Cambodian MFI came here, saw all this wonderful work that ASKI is doing, would they even be able to come close to replicating them back in Cambodia?

I don’t think they could.

While there are a few Cambodian MFIs who are working hard to provide their clients with services beyond loans and savings they are struggling to do this without any government support.

While I knew before now that microfinance cannot do it all alone, after reflecting on the differences in Cambodia and the Philippines this point just smacked me across the face and I couldn’t help but think, holy cow, what a difference a government makes.

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For my next blog post I want to try to experiment with something. I will be in the field, visiting branches and clients all next week, as fellows this is what we live for and this is where I find I learn the most. If you have any questions about Microfinance, Kiva Field Partners, or anything else that you think I may be able to answer while I’m out and about next week, leave me a comment and I will try to create a video response to your question. Again, this is an experiment and I’m not sure if it will work, but hey, lets give it a shot.

To see ASKI loans currently funding click here.

To join the ASKI (aka “The Coolest MFI in the World”) lending team click here.

Drew Loizeaux has been a Kiva Fellow since Febuary 2009 and is currently working at Kiva’s partner ASKI in the Philippines.

“Allow me to introduce myself”, I’m Laura Buhler, a member of the KF8 class.

I am from Calgary, Canada and have found the transition to life in Rwanda to be very smooth, given just a couple of bumps in the road.

Exactly two weeks in to my Fellowship at Vision Finance Company (VFC) in Kigali, Rwanda, one baggage loss and one hospital visit later, I have settled in to life here in Rwanda. Since arriving, my mind has been flooded with questions and realizations about this new culture. In fact, I am sure that this constant thinking has been the factor that led to my lack of sleep at night, and my resulting illness! But it’s true… my mind is going a mile-a-minute just fascinated with this place and its infinite complexities— political, cultural, social… and commercial.

The commercial sector is very different here. Entrepreneurship seems to be taking off, but in some ways it still appears to be a new concept. Allow me to illustrate…

Lunch-time. It’s the only time of day when I’m really ready to spend the cash that I have. I am hungry! So I step outside, in very much an up-and-coming business district (Muhima), and walk for 40 minutes in either direction… no café, no brochette stand (basically kabob), and no restaurant to be found. That day, my money got me nowhere.

If some guy set up a brochette stand in this neighbourhood, he could be a gazillionaire, and he’d have a monopoly  He could charge whatever he wanted because there are hundreds of hungry business-people around ready to spend.

This is a story that continues to repeat itself. It is one of my most major realizations about Rwanda is the amount of opportunity for entrepreneurship. I suppose one could look at it as a lack of entrepreneurship, too. I think that the real case is that the combination of the trauma of the past, and general lack of good market conditions (e.g. access to capital) have meant a bleak-looking marketplace for aspiring entrepreneurs here. But the micro-banking world appears to be addressing this. The opportunity for start-ups is tremendous here, and organizations like Vision Finance Co. have already begun to seize it, providing loans for folks who want to develop Rwanda by developing their own small business… (Please read the excellent Financial Times article by Paul Kagame, President of Rwanda, as he discusses the importance of entrepreneurship.)

This is why I believe in microfinance and the role it plays in the development of economies. I believe that the first person to open a brochette stand in Muhima will play a role in developing Rwanda. I believe that when Vision Finance Co. gives her a first loan to buy the grill, microfinance is playing a role in developing Rwanda. Finally the businesspeople in Muhima will get to eat lunch! Both parties would be a lot better off.

If you have not already made a loan through the Kiva website, please follow the link to see the entrepreneur you can help out today!

Over 7,000 miles away from San Francisco, I’ve finally arrived in Lebanon to start my fellowship with Al Majmoua , a microfinance institution based in Beirut but with mulitiple branches around the country. Flying from my last connection in Dubai to Beirut, we cross over an endless expanse of desert as we pass over Saudi Arabia and Jordan.  The desert starts to make way to rocky mountain peaks as we fly over Syria and finally I start to see specs of green -al-arz (the cedars) – I’ve arrived.

The noise from the screaming kids (in-flight entertainment system was broken-lovely) and exasperated parents dies down to a quiet murmur as we start to get our first glimpses of the Mediterranean and the Lebanese shoreline. The entire plane is silenced by this stunning view – sandy beaches, rocky coasts and plummeting cliffs.  All the last-minute nervousness and doubts I had when boarding my plane from the US (quitting my job given the current economic climate,  leaving my rent-controlled apartment, getting rid of my goldfish…) melt away as I watch the electric blue waters of the sea and recognize various Lebanese landmarks – this is why I came here.

This country is rich in history and culture , it’s capital –Beirut- was once known as the “Paris of the Middle-East”  .  Fifteen-years of civil war seriously damaged the country’s economic infrastructure. Lebanon started to recover but the war of 2006 set the economy back yet again. However, what I admire most about this country and its people is their ability to bounce-back- nothing phases them – they just pick-up where they left off and rebuild as necessary . I came here because I wanted to see the power of microfinance in improving these peoples’ lives and in aiding to restore this already-on-the-mend “Paris of the Middle-East” to its former glory – it’s time again for Lebanon to be recognized for its rich heritage,  its  peoples’ “joie de vivre”  and its breath-taking beauty.

Alia Rafeh is part of KF8 and will be working with Al Majmoua in Lebanon  for 11 weeks where she will attempt not to completely butcher the language. To fund borrowers from Al Majmoua  on Kiva, click here.

Tamara Sanderson, KF8 Mongolia

During Kiva Fellows Training, Kiva Fellows Director JD Bergeron emphasized the word connect within Kiva’s mission statement: “to connect people through lending for the sake of alleviating poverty.”   He said that without the connection factor, Kiva would not exist.

I mentally agreed with him at the time, but after reflecting on my first week in Mongolia, I am realizing the truth of JD’s statement.  Below, you can find a few examples.

Support from Strangers

After 22 hours, 3 flight segments and multiple checks for swine flu, I finally arrived in Ulaanbaatar from Dallas.  As an email junkie, I immediately turned on my blackberry after landing and started checking my emails while waiting in the immigration line.  While scrolling through, I noticed a lender message to one of my lending teams.  Eileen, a fellow Kiva lender with an interest in Mongolia, sent me a message wising me good luck during my Kiva Fellowship at XacBank and made a loan to my lending team.  Although I have never met Eileen in person, it was a very encouraging message to receive within my first steps on Mongolian soil.      

A Genuine Smile

XacBank posted its first loans on Kiva.org in January 2009 and recently started posting journal updates now that the borrowers are in the midst of their loan repayments.

Maggie, the super star Kiva coordinator, turned around to me on my second day at XacBank and asked why the Kiva Fellows made so many comments on the first set of journals she posted a little over a week ago.

I looked over her shoulder and saw over 80 lender messages from people around the world congratulating the entrepreneurs on their endeavors and thanking Maggie for her work.  I explained to her that the messages were not from Kiva Fellows, but rather from lenders on the Kiva website. 

She then looked at me with a genuine smile and said, “Wow, you mean all these people responded to journals?”

Throughout the week, Maggie has mentioned these lender comments with her colleagues, and we have started brainstorming ways to relay these messages. 

A Vision

Despite the fact that Kiva only makes up about 1% of XacBank’s microloan portfolio ($300 k out of $22M), XacBank has grand visions for the Kiva partnership, inclusive of an exponential curve of Kiva loan growth in Mongolia.

As I met with the CEO on Tuesday, his ideas reminded me of conversations I had with Kiva staff last fall while volunteering in the San Francisco office.  Although Ulaanbaatar and San Francisco are on opposite sides of the world, the same mission bridges the two together.  Largely, our conversation focused on connecting Mongolian borrowers and lenders to Kiva.org through media outlets and social development.

The dictionary defines connect as “to join, link, or fasten together; unite or bind.”  Without the connection factor, Kiva is merely just a combination of tools: a website and finance.  But, by uniting people across the world for a common goal of alleviating poverty it becomes something much greater.  It becomes powerful.

Connect with Mongolian Entrepreneurs today – Lend

Why is it that Kiva gets a bad rep for funding MFIs that give out loans to the people who otherwise would not receive them?! Recently, a blog was written on socialedge.org/blogs about a particular experience a “video journalist” had when she visited MFIs in Cambodia and Mozambique and spoke to “countless Kiva loan recipients” while there. The author’s article was based on the fact that “none of them had succeeded at pulling themselves out of poverty” because of these five reasons:

1) The High Interest Rates Being Charged
2) Inadequate Economic Opportunities
3) A Lack of Business Skills/Entrepreneurial Talent
4) Over-burdened Loan Officers
5) Lack of Sustainability

As most of you reading this are Kiva lenders, I want to refreshingly remind you of why the people she met (whom we do not learn much about in her article), were only a few of the 180,000 Kiva loan recipients to date, and do not necessarily represent the experiences of every Kiva loan. These few interviews can be seen in Episode 9 of her documentary series.

I want to use this blog post to layout, from a Kiva Fellow’s point-of-view, how challenging it is to lend to the poor, both fiscally and temporally. Let me share with you how Kiva (and microfinance) not only helps MFIs, and subsequently their borrowers/members, to stay afloat, but is also going to, overtime, help reduce poverty.

Kiva prides itself on transparency. Arguably, there could be more *asterisks on kiva.org where people are getting a little confused. I know that when Kiva says their loans charge 0% interest, it may feel a bit funny to learn that some MFIs charge a large interest rate to cover their expenses. The great thing about lending to Kiva is, however, that the influence of Kiva keeps costs down. By giving interest free loans, some MFIs will lower their interest rates, while others will use the extra money to give more loans. Without an interest-free donor, some of these organizations would cease to grow, or even begin.

GHAPE, a Kiva Partner in Cameroon, for example, has their borrowers receive loans in five progressing stages. Type I loans, starter loans, must be 40,000 CFA (about $80). They charge a flat-rate, annual interest rate of 15%. If you do the math, you simply cannot run a center of 40 new members on the interest alone. So, how does an MFI get off the ground? They either charge a lot of interest to first-time borrowers who can barely invest small loans, or they look for funders who are interest free and/or give money as a donation. The later is a common strategy.

At GHAPE, they are always looking for new ways to expand and open up new centers. Centers in rural areas can cost a lot in transport fees, which usually includes check-ups for first-time borrowers. Check-ups and first-time loans are how the poor get to establish a credit history, and it is not cheap. So, to start a new center, GHAPE has to get upfront costs from somewhere. That money is either taken from their portfolio (which means other members do not have access to credit as often) or they look to interest free lenders, like Kiva.

The most common critique of microfinance is that if it is not coupled with business or loan management training then it will have little impact. I agree. All MFIs should help their first-time borrowers receive this type of education. However, not all MFIs are created equal. Some started out as banks, and as a section of their portfolio, give loans to those in poverty. Others start fresh as poverty-alleviating organization. Again, the great thing about Kiva is their transparency. As a lender you can find out information about the MFI the loan is going through. Every “Field Partner” has its own page on kiva.org.

This is an excurpt from GHAPE’s Partner Page on kiva.org:

Program Design: The problems facing the poor, especially poor women and young people, are multiple and interrelated. Because of this, GHAPE has developed an innovative poverty alleviation package, Empowerment Credit (EC), which contains the fundamental empowerment resources required to fight abject poverty. Included in EC are trainings (business development service), credit and social education. To guarantee sustainability and maximize GHAPE’s scarce resources, this package is administered sequentially, and it simultaneously meets the current and emerging needs of borrowers.

When I read this, as it is linked to all of GHAPE’s borrowers, I know that GHAPE has a training package for all five stages of its membership. Having heard a lot of the these trainings and the reactions from GHAPE members, they clearly have an impact on these entrepreneurs. They note that the education is one of the main reasons they join GHAPE.

As for loan officer burden, they have to have large case loads in order to keep costs down. I can attest that each loan officer at GHAPE knows all of their center members. When it comes to getting personal attention, that’s where Center Chiefs come in. GHAPE Center Chiefs co-conduct each semi-monthly meeting and are the connect to their branch office, where they visit regularly. Center Chiefs are also trained and meet once a year to make improvements on GHAPE.

I cannot say enough about the work done at my MFI. It is hard to be impartial. The employees working there understand that GHAPE’s cause is to make a difference. I also know that GHAPE uses Kiva to fund a lot of their loans. Some borrowers say that without a loan from either GHAPE or Kiva, they would not have the income they have today.

For one example: a Center Chief at GHAPE, Christina Manka Ngwa, said to me that if it were not for the loans she had received from GHAPE, she would not have been able to sponsor her child to go to University in Cameroon.

To come full-circle, I will give my final point, one that I cannot know for sure, but I feel very confident about. If we continue to invest in Kiva borrowers, we may not get them out of poverty at first, but we will help feed, cloth and educate their children. I do see that when you send these children to school, they will “live a fine life,” and themselves, be lifted out of poverty. To me, that is why I loan and I hope that, at least with GHAPE, people can see that microfinance is working, even if it is non-obvious and slow to come.

Maria Shriver and I just made a loan to Elizabeth, the first US Kiva Borrower- next week Elizabeth is cutting my hair!

The adrenaline rush I have right now going onto Kiva’s website and seeing loans for entrepreneurs in the United States might compare with what sports fans feel when they watch a good super bowl game.

It’s so exciting. I log into my Kiva account and can see the borrowers that we have been gathering the last few weeks all the sudden go active on the Kiva website.

Preparing for the U.S. launch has been somewhat of a “top secret” operation over the last few months and today it’s finally real.

Check out  a few videos of some of the borrowers from ACCION USA that are included in the June 10th US Launch!

Joe from Erica Dorn on Vimeo.

Luis delivery service from Erica Dorn on Vimeo.

Gotta go.. Premal is coming on Good Morning America!!!

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My personal interest in US microfinance began while fundraising for rebuilding projects in New Orleans after Hurricane Katrina. Seeing the desperate need for support of small businesses aid and development to strengthen communities, it has become a goal to spread awareness about US Microfinance. I have been thrilled to be the first domestic Kiva Fellow helping launch such a momentous development in US Microfinance.

Check out all of the ACCION USA loans being funded on Kiva.

For more information- kivaprogram@accionusa.org (I’ll be the fellow checking the email) Wonder how many will come in today?