One popular critic to microfinance is it promotes businesses that don´t bring value. For instance, giving a loan to a woman to start a tomato shop beside 10 other tomato shops. Instead of creating value, it divides it.
This is why one of the biggest bets from Kiva are green loans. Under this category you can have solar lamps, ecological kitchen and other type of products that aim to improve families standard of life.
I was not sure of the effectiveness of this type of loans until I met….. He has a very humble family that lives in the coast of El Salvador and he is a fisherman. One day the loan officer told him about a solar lamp that could take energy from the sun and turn it into light and electricity. After serious discussions with his wife they decided to risk and buy it.
3 months after they bought the solar lamp and with his own words: “It is the best purchase we have ever made, it has changed our lives”.
Before they used candles, which apart from being expensive and dangerous, (they live in a wooden cottage), they did not bring light enough. With this solar lamp, children can now do their homework after the sunset and potential robbers are also espantados. One other curious thing that has changed is now his mother (grandma) wants to go and have dinner with ner grandchildren. Before she did not want to go because she said there was not enough light and you could not see. Now she goes whenever she can.
Moreover, they have found a way to get income from the lamp. As this lamp enables charging cell phones, they offer to their neighbors recharge their batteries at a fair price, bringing advance to their community and saving them time.
These last Christmas have been the first ones with proper light. And this big change hasn´t cost them at all, because the monthly expense in candles thay had is now their monthly fee to Integral and Kiva. After one year, their loan will be fully repaid.
Kiva. Loans that change lives.
This last week I have started to meet borrowers and feel the reality they face. It is a reality full of difficulties and challenges, in which a small amount of money can make the difference to the person that receives it, his family and his community.
ID Ghana has a different approach to microfinance, they call it “Onipa Nua”. It is based on group relationships. What they do is forming 15 to 40 people groups (95% of members are women) and they are trained in different abilities: saving, convive, how to manage a business, loaning, health…and many more areas that help them build a successful group up.
Each member of the “Onipa Nua” is only responsible for his loan, and does not guarantee other members´ loans. However, as in these countries “your problems are also your neighbors and friends´ problems”, the compromise borrowers have with their loan is total, and under any circumstance they want to let other members down.
Onipa Nua´s members are extremely aware of the importance of a loan and what it implies, this is why they just borrow what they need, and if it is necessary, they stop eating rather than stop paying back their weekly fee.
When you see this, it gives you goosebumps. You feel again those values that are not fashionable anymore, like compromise, effort and honesty.
This reminds you that what is worth in life is what you achieve following those principles.
After an easy trip. I arrive to Accra, Ghana. The first feeling you have when you step out of the plane is an intense hot an humidity, and this in when you miss the snow at home.
It is 8 PM and the Ghanian national football team is playing the semifinals of the African Cup against Burkina Faso. The whole country is mobilized. I can hear the screams all along the airport. For the moment they are drawing, but with good opportunites. Maybe it is because of the macth that taxi drivers are behaving in a foolish way. I asked one of them about a hostel I knew, and he answers me he takes me there without any problem. I jumped on the taxi with all my stuff, we move forward few meters and he starts asking everyone where the hostel is. I ask him if he truly knows where it is, and he answers me no.
I make the same process with another taxi and it happens completely the same, till a kind woman called Evelyn, offers me her help. She told me she knew a hostel not far from her home. I relied on her and her little son John.
After a few minutes drive we arrive to the hostel. It was not as cheap as I expected, but it is 10 am, I am exhausted and the last thing I want to do is wandering in an African city of 3,5 million habitants. I go straight to bed.
The day after everything is the first time for me.
My first bedroom
Mi first sight of Accra
My first bathroom
My first coconut
My first meal
My first defeat.
I realize Ghana lost in penalties. It is in that moment when I remind they almost are the first African country in reaching Worldcup semifinals. An Uruguayan player´s hand and the latter missed penalty of a Ghanian player impeded it.
Bad luck in football continues for me. In El Salvador I attended with Fundación Campo Microfinance the qualifying game between Costa Rica and El Salvador. Of course, they lost.
But this event do not remove the smiles from them. They know what is suffering in the field and out of it. This is why they give thanks for reaching so far and they will try again harder than ever next year.
The day after the defeat, some supporter demonstraiting their devotion for the national team.
When I hear the words “Christmas” and “end of the year” my mind quickly thinksabout Christmas trees, baby Jesus, cold, family, presents, snow and many more. When I ask the people from Centroamerica whatcomes to their mind with these same words they mostly answer the same, the only thing they change is they don´t say cold neither snow, and they normally include beach or river instead of them.
1st January in Rivas, Nicaragua
After tough 3 months of work in El Salvador with Fundación Campo, Padecomsm and Integral I have just taken deserved holidays. Destination: South of Nicaragua. The reason for choosing it is because of its amazing beaches full of waves, its economic price, its cultural wealth and its proximity. And one more reason. Because it is close to the border with Costa Rica. My 3 months visa expired on 1st January. After seeing the endless points required by the Salvadorean government I decided to leave the C4 (EL Salvador, Honduras, Nicaragua and Guatemala) in order to extend my days in El Salvador without being fined.
It was not an easy trip to destination. I waited for 5 hours to thebus that took me from El Salvador to Costa Rica (the engine broke before picking me up), 15 hours trip, 4 borders crossed (El Salvador, Honduras, Nicaragua and Costa Rica) with payments in all of them and an unforgettable night with 1000 ants in a room in the border of Peñas Blancas. Without doubts, the worst room I have ever slept in. I highly recommend not to sleep in a border, it is not a good atmosphere to sleep in.
But, ¿How important is it when the image you see when you wake up is this?
From Nicaragua I wish you a happy new year and a lot of Kiva love to all of you!
Salvadorean people are strict Christians and their most important date in their calendar is Christmas Eve. They celebrate the Birth of baby Jesus. They live this day quite similar to American people: meeting the whole family and sharing together.
This is how 24th December was:
Wake up! Don´t ask me why we get up so early, I don´t understand it yet.
We killed 2 hens, we plucked them and quartered them, with all the preparation they need.
Go to the bank to withdraw the present our brothers & sisters that live in USA has made us in form of remittances. Long queue and slow employees. We wait for an hour.
Go to the market with mami Valentina to buy the last things me need to prepare the dinner. It is crazy how busy was the market!
Come back home alone because I lost my mami in the market. We continue preparing the hens.
We eat eggs with frijoles.
My sister Marcia prepares Honduran Torrejas and sanwiches.
Everything is ready. Lets prepare and stay with friends and family around the area.
Papa Chente, mami Valentina, hermana Marcia and me have dinner together. The menu is roast chicken with thin corn Salvadorean pancakes and pineapple juice.
Family members begin to arrive. We talk, dance, laugh, chat, hug…altogether!
We go to buy fireworks and start exploding them.
We hug every single relative and friend, we wish them merry Christmas and continue exploding fireworks!
We go to bed after good dances of Cumbia, bachata (my favourite one) merengue, salsa…I get lost with dance names and I don´t distinguish them very well.
Merry Christmas and happy 2013!
Few days ago, an American couple that collaborate with Kiva translating loans sent me an email. The team of volunteers they belong to is one of the most important pieces in Kiva (there are nearly 400 volunteers around the world). They make possible all loans, no matter where they come from, are accessible in English.
This couple not only translate loans but also lend money to entrepreneurs through Kiva, especially to El Salvador. Few years ago, they lived for two years in a little Salvadorean village working as volunteers. When they went back to the USA, they did not want to lose contact with this region and they were looking forward to keep helping in the distance. This is how they found in Kiva the best way to do it. They told me translating loans is easy to combine with their current jobs and you control how much you can do.
They told me they would stay for a week in El Salvador visiting some friends they left in the past and they asked me if it was possible to visit any of the borrowers they translated or invested in. The idea of an encounter between borrower and lender captivated me, and we started to work on it. (Not as easy as it may look: transport, communication and logistics is a different story in deep El Salvador).
After some steps we managed to make the challenge of putting borrowers, Mr and Mrs Luehm, and lender, Mrs Delfina, together. It was one of the best moments I have had in El Salvador. Seeing the encounter among these people and the conversation they had was wonderful.
Photo taken by Carlos, credit advisor from Padecomsm, on 23rd December 2011, when Mrs Delfina asked for a loan.
Photo taken on 22nd November 2012. The encounteer.
Nowadays, with initiatives like Kiva ´s, it is not possible to say either “ I want to help , but I don´t know how nor who” or “I dont want to help because I don´t know where my money goes to and the impact it creates”.
In Kiva, you can find more than 2400 stories and pictures of people/families in need, from every sector and from more than 60 countries. Every euro you lend through Kiva reaches the person you choose, and because it is a loan, not a donation, it bets on the sustainability of the project and consequently his life.
Your small amount, 25 dollars, it´s a lot for them.
Kiva, loans that change lives…
…And brings people´s lives together.
Here are all participants in the process of a Kiva loan: Borrower (Mrs Delfina in the center),Microfinance organization, Padecomsms (Rubidia, Kiva Coordinatos, and Carlos, credit advisor, in the left) and Kiva (represented by KF19 Juan).
Thanks Lehm couple and Padecomsm for this magic encounter!
There is a famous song that defines Salvadoreans as people that eat everything, enjoy everything and do everything. I have checked these lyrics are right. There is a word usually used for referring to Salvadoreans, this is “rebuscados”. If someone is “rebuscado” it means he does the impossible to achieve what he needs: paying back a loan, help a relative or feed his family. As they say, they can even sell rocks to find a way to survive.
Like many countries in the American continent, poverty affects great part of the population and a job is extremely difficult to find. This is why many people decide to be entrepreneurs, because the only opportunities they find are the ones they create.
But even if they want to start a small business it is extremely difficult to do it. Most of the people don´t have enough money to begin and they have no access to banks. These institutions normally require having a job, presenting an electricity bill, having properties to set as guarantees, etc and the majority of these humble people do not satisfy these requirements. And even if they do, the high interest rates they have to pay makes the business unprofitable. The other day one woman told me she had a one-year loan with a well-known bank and she had to pay back the same amount of interests and capital. Crazy.
One more thing Salvadorean entrepreneurs face are maras, or also known in the USA as gangs. It is the cancer of El Salvador. They are groups of young people (10 years to 30) that control the areas where they live. They oblige businesses to pay a rent, arguing that they will protect them from other people. If they don’t pay the amount, they can end badly.
There are several options:
1. Paying the rent.
2. Not paying, close the business and move to another area.
3.Not paying and continue with the business. If they do this, there will probably be a death in their family.
And this is real live in El Salvador. Yesterday we were visiting a client that had one of the most successful businesses in “Puerto del Triunfo”. Gangs required her to pay a rent that was higher than the amount of the loan she received few months ago. She paid what she could (the same amount as the loan,1000$) , but this was not enough for the gangs. Her son started to receive serious threats to kill him. She had no option. She closed the business and moved to a different area. Now she and her family hardly live with a small pupusas business.
Not easy the life they have and the risks they face. But despite all these difficulties, they continue fighting for their families and dreaming in a better future. Thanks to organisations like Fundación Campo, Padecomsm and Apoyo Integral that collaborate with Kiva, they receive those opportunities they were looking for.
These are loans that change lives.