The Dangers of Being an MFI Loan Officer

28 February 2010 at 18:27 10 comments

By Eva Wu, KF9 Philippines

Imagine you’re a loan officer who’s working for one of Kiva’s partner MFIs. You’ve been traveling around the field, collecting repayments from quite a few clients over the course of the day. It’s getting late, and you’ve amassed a huge amount of cash – the equivalent of a few months’ worth of income for locals. As the sun begins to set, you realize you’re still at least an hour away from the office – an hour’s worth of travel on your motorcycle, over rough roads that are poorly (if at all) lit. What do you think could happen next?

Out in the FieldWhen I ask HSPFI‘s loan or project officers what they find most challenging about their jobs, they always say repayments. Not just because all the hours spent traveling to get to clients is rough and arduous, but because project officers make tempting targets for robbers and thieves as they carry huge sums of cash repayments back to their MFIs. One of the HSPFI project officers who I met was actually robbed at gunpoint in broad daylight. At around 10AM in the morning, the project officer found himself confronted by a robber with a gun and was forced to hand over all the repayments he had collected. Shocked and confused, the project officer went home before heading to the police station to report the crime.

HSPFI project officers are generally fairly philosophical and accepting of the dangers that comes with this line of work (“It is a part of our job and duty… it is an experience.”) But still, it took me some time to digest the fact that many of the project officers who I’ve met and come to respect are quite literally putting themselves in danger every day. Not only are project officers potential targets while they’re on the road, but they can also come under fire from clients or clients’ families. One such encounter involved a project officer and a client’s drunken knife-wielding husband. Luckily no one was hurt, but I don’t think that project officer managed to collect the client’s repayment that day. (This also made me realize that there was another practical reason as to why MFIs tend to target women borrowers – most women are probably less prone to threatening MFI loan officers with weapons or other dangerous household objects.)

In the FieldWhat do you do? I pressed. What do you do under these circumstances? After all, as one HSPFI project officer told me, it’s not like we can carry guns with us. Another project officer who’s worked for over thirteen years with HSPFI shared that she tries not to react in difficult situations where she is being provoked by angry clients. You do not react, just do your part. And smile. Smile on the outside even though it’s hard on the inside. She added that most people will usually cool down with time; some clients have felt so ashamed of their outbursts that they’d visit the office and apologize to her.

There are also other strategies that project officers can employ to help reduce their personal risk. Project officers at one of HSPFI’s branches would travel in a group to a particularly remote village, setting out early in the morning on their motorcycles to visiting several villages on the way, and returning to the office after night has fallen – trusting that there is safety in numbers. HSPFI has also taken steps to help ensure the employees’ safety – project officers do not carry cash and give out disbursed loans to clients at their centers or their homes. Instead, clients visit HSPFI branch offices to receive their loan checks. I had guessed the reason behind this policy (as I’m sure you have as well), but I asked why anyways. It was because the risk for project officers carrying all that money one-way was already so high, HSPFI couldn’t risk doubling the danger to project officers by asking them to carry funds to AND from the MFI.

Most of all, project officers tell me that they pray. HSPFI staff pray that God will protect the project officers and ensure their safety while they’re working in the field. Next time you receive your repayments from Kiva, I hope that you can send a thought (or a prayer) to the hardworking MFI loan officers, who are working in difficult and dangerous environments to make sure that your money gets repaid!

Project Officers in the Field

Eva Wu has already finished her placement in the Philippines, but she crammed so much field traveling in her last few weeks that she went home with a bunch of stories left to share. She plans to linger on for a bit longer until she’s caught up with her Kiva Fellow duties here and on her personal blog. In the meantime, support HSPFI by joining the HSPFI lending team!

Entry filed under: Hagdan sa Pag-uswag Foundation, Inc. (HSPFI), KF9 (Kiva Fellows 9th Class), Philippines. Tags: , , , , , , , .

Who really cares about Kiva loans? The difference between Kiva and MFI loans Why Charge Any Interest At All?


  • […] face in operating in remote rural areas – long, arduous travel for the staff being one, and threats to loan officers’ personal safety being […]

  • 2. Shyamnagar PROGATI  |  1 July 2010 at 18:56

    ‘’Shyamnagar PROGATI” is a MFI & Live hoods working Kolkata W.B. Urban & rural Microfinance. Working Poor women , children & farmer
    Support Our Organization. Apply loan.

    Shyamnagar PROGATI
    Ananda Lal Chakraborty
    ph: 9062164580

  • 3. Alex  |  18 April 2010 at 09:24

    “Most of all, project officers tell me that they pray. HSPFI staff pray that God will protect the project officers and ensure their safety while they’re working in the field”

    I’m very sorry to hear that. Perhaps if they put a little less trust in their invisible friend, they could come up with a concrete way to improve their situation. High interest rates don’t bother me nearly as much as your religious prosthelytizing does.

    • 4. Bena  |  1 July 2010 at 21:14

      If a person prays they are not ‘prosthelytizing’ as you put it. If you don’t believe in a supreme being that is your choice, allow those who do their beliefs. Prosthelytizing is preaching, not praying.

  • […] reading Nick Malouin’s “Live Music from Senegal” and Eva Wu’s “The Dangers of Being an MFI Loan Officer“. Both posts pulled me in right away and I even clicked through to the originals. (Note to […]

  • 6. Fehmeen  |  2 March 2010 at 09:16

    I think another problem collection officers have to face is that of animosity from the borrowers, unless loan officers are very sensitive to the feelings of borrowers.

  • 7. MURINDANGABO RWANDA Aimable  |  1 March 2010 at 07:06

    Many thanks to Kiva for its contribution to alleviate poverty.

    God bless all lenders!

  • […] from one bank account to another with the click of a mouse, where you have to ask employees to constantly risk their personal safety by carrying huge amounts of cash over uncertain roads and terr…, those banks would not be charging 8% interest or even 18% interest, but a much, much higher […]

  • 9. Jeff  |  28 February 2010 at 18:48

    Good report, Eva.

    What happens when money is lost in the way you describe. Is that a direct loss to the MFI’s bottom line? One would assume so.

    Looking at it from the reverse direction, I’m surprised that attacks on money-carrying loan officers is not much more common to the point that it makes the operation of an MFI impossible. What is it that prevents this from happening? Is it a low level of lawlessness? A very good police force?

    • 10. evacwu  |  1 March 2010 at 00:22

      Thanks Jeff! Yes, I believe in the case of the robbery it’s a direct loss for the MFI. And with regards to attacks on loan officers, it’s hard to say without more data. I’ll just add that it depends on the area. HSPFI operates in the northern provinces of Mindanao, which is known as a rough region in the Philippines. But as communities vary between provinces, so does crime rates – different HSPFI branches have noticeably different levels of concerns with regards to project officers’ safety. I’d venture that project officers working in the north are generally safer than project officers in the south, and cities/urban areas are trickier than rural areas.

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