Welcome to Kiva, Georgia! (Part II)
By Kevin Mihelic, KF12, Georgia
Kiva will soon start a new partnership in the Republic of Georgia. I have already introduced the Kiva community to the country of Georgia in Part I. Part II will be introducing our new partner in Georgia, VF Credo, and some of their clients.
VF Credo Mission
Credo’s mission is providing sustainable financial services to the entrepreneurial poor and Georgian micro- and small businesses, with a preference for rural activities and those businesses that create income and employment opportunities for the poor. With a portfolio of above USD 29 million, Credo serves up to 38,000 clients in the country. Credo offers a variety of the loan products to Georgian citizens through 16 branches of the organization.
VF Credo History
In 1997, World Vision (WV) started the “Georgia’s Entrepreneurs’ Fund” (GEF). The year 2002 was a milestone for WV/GEF and could be considered as a new start of the program; support from the Canadian International Development Agency enabled growth from a one-branch operation with a small portfolio to start branches in Kutaisi and Batumi, doubling the portfolio and tripling the number of clients. Strong growth continued since with new branches in Akhaltsikhe and Borjomi.
In 2005 WV/GEF obtained local registration in Georgia, thus transforming into an indigenous legal entity. Vision fund International, a California-based microfinance corporation managing a USD 70 million portfolio invested in 45 MFIs, was the founder of this entity. WV/GEF upon registration continued operations under the name VisionFund Credo Foundation, shortened as Credo. Vision Fund is wholly owned by World Vision International.
Because of a new law on microfinance, VisionFund Credo non-commercial non-entrepreneurial entity established a new company in December 2007, LLC MicroFinance Organization Credo. The new Credo has been licensed by the National Bank of Georgia as an MFO and VisionFund Credo transferred all the rights and obligations of outstanding loan agreements to LLC MFO Credo.
Recent years have been successful for MFO Credo. Motivation to effectively combat the economic stagnation, and desire to grow and adjust to the changing times, has been positively reflected on Credo’s growth rate-100% in both number of clients and portfolio
VF Credo Clients
I also recently had the opportunity to travel and meet some of Credo’s existing borrowers. While they are not Kiva borrowers, they agreed to share their stories with the Kiva community.
Zaza, Greenhouse construction
Zaza has been a Credo client for 4 years. He lives with his wife, son, daughter, and mother in a small village near the capital. He is currently on his 4th loan for $2,000 (his previous loans being $300, $500, and $1,000). The past loans were used for animals-of which he now owns 2 horses, 2 milking cows, and several chickens. He sells the dairy products and eggs to a regular client base that he delivers to in the village.
With this new loan, Zaza wants to diversify his income by building a greenhouse to grow more fruits and vegetables. His mom has sold vegetables for the household for several years; this has been on a small-scale and only during the summer. This greenhouse will enable the family to grow many varieties of vegetables year round. When I arrived, Zaza and his wife were clearing brush on their land to construct the greenhouse. The loan was disbursed the prior week, and they hope to have everything built in two weeks to begin planting.
Zaza and his wife also graciously invited me into their home where they served me cookies and wine to celebrate my visit. Zaza showed me past trophies he had as a Judo competitor, and talked proudly about his son and daughter who are currently in high school. Zaza wants to continue using Credo loans to grow his business and provide for his family and home.
Nikoloz, Vegetable and Fruit Seller
Nikoloz is a fruit seller in a market in North Tbilisi. He is a displaced Georgian from the Abkhazian region, and moved with his parents to Tbilisi during the wars of the early 90s. Nikoloz and his parents have been jointly operating his market stall for the past twelve years, but this is only his 2nd loan with Credo. He has been very happy with Credo, but has not needed loan capital much in the past.
I visited Nikoloz and his parents at their fruit stand and discussed with him the issues he has been having with business. Unfortunately, business has been poor for Nikoloz lately. This past summer and fall saw unfavorable weather conditions in Georgia. This has driven up the prices of fruit and vegetables on the wholesale market and has also caused reduced demand from many residents in Tbilisi. Both the increased prices and low demand has required him to borrow from Credo to meet his temporary business needs.
Zaza and Nikoloz are just two of the borrowers I was able to meet in Georgia. Credo has many clients and offers 5 different types of loans (Urban Business, Agricultural, Agricultural Equipment Leasing, Tourism Development, and Household). If you are interested in lending in Georgia and to borrowers like Nikoloz and Zaza, please be on the lookout for Credo loans as they become a Kiva partner soon!
Kevin is currently helping VF Credo in Tbilisi, Georgia prepare for their Kiva partnership. Working to bring a new partner to the Kiva community while exploring the many wonderful sights of Tbilisi has been a wonderful experience for him.