Posts tagged ‘microfinance’
By: Abhishesh Adhikari
One of the Kiva partner MFIs that I am helping in Uganda is Micro Credit for Development and Transformation (MCDT.) It is based in Kampala and provides financial services primarily to low-income women who come to Kampala from remote areas of Uganda. Even though the average loan size for a borrower at MCDT is only about $200, it is amazing how impactful the loans have been in helping these women become financially independent.
Here in Mongolia, my top priority with XacBank has been to complete borrower verifications (BVs)—visits to 10 randomly selected Kiva clients to ensure that everything in the field checks out with the information reported to Kiva’s San Francisco headquarters. As it happened, the borrowers in my sample were scattered across the country. Here’s a summary of what my month of April looked like:
- 1 month spent
- 4,872 km covered
- 9 borrowers verified
- 5 aimags traveled to
- 7 branch offices visited
- 10 training sessions delivered
- 35 loan officers and other staff trained
- 13 top Kiva borrowers recognized
- 1 television interview completed
- 67 client waivers checked
- 2 runaway borrowers chased down
- 1 Kiva Coordinator-Extraordinaire
- 2 beautiful lakes and other sights experienced
- 4 items delivered via Mongolian messenger service
- Many kilos of cheese curds (and other nice gifts!) received
I couldn’t help but feel lucky—I knew it would be an eye-opening experience to visit all these different parts of Mongolia. After all, I think most Kiva Fellows are in this as much for the professional experience as for the exposure to new countries and cultures. Why not mix business with pleasure if you can?
I’ve talked before about some of the work that Kiva Fellows do when we visit branch offices during our BVs, but what I didn’t explain was how, in order to successfully complete a BV, the Fellow must meet with every single borrower on the list. If for whatever reason, a borrower is unavaible or nowhere to be found (and that’s happened before!), the sample must be re-drawn and 10 new borrowers must be verified—no matter how close you were to finishing the first set of 10 (and irrespective of how far and long you had to travel to see them). So it’s safe to say that Kiva Fellows sweat it a little when these meetings don’t line up perfectly. And people are often on the move, which can raise some serious logistical challenges sometimes.
Take Aibek, for instance. Batzul, the Kiva Coordinator at XacBank, booked us flights to go see him in Bayan-Olgiy, the western-most province of Mongolia (flying made sense given that Olgiy, the city centre, is a 3 day drive from UB). She also arranged our accommodations and made plans with the Director to deliver training sessions at the branch office. We were all set to leave on Monday morning, but late in the afternoon of the Friday before, she called me up sounding very serious: ‘Aibek is not in Bayan-Olgiy. He’s in UB right now. I just spoke to the loan officer.’
The trickiest part was that he was only planning to be in UB for a few days—which meant that by the time we came back from our branch visits in Bayan-Olgiy and Uvs provinces, he would have left already. We couldn’t change our flights, and flying to Bayan-Olgiy a second time was pretty much out of the question. So the best thing to do was to meet in UB during the weekend. We made plans to meet him on Saturday at 10 a.m. in his neighbourhood. We made our way to the east end of the city and waited… No Aibek.
Batzul called the loan officer in Bayan-Olgiy, who then called Aibek, but he wasn’t picking up his phone. We communicated through his wife, who was at home. We waited and waited. No Aibek. We gave up and agreed to try and reschedule.
Our opportunity came that afternoon. Aibek, the loan officer told us, would meet us by the Wrestling Palace at 1 p.m. When we got there we searched in vain for any passers-by who looked like the man in the borrower profile. An hour passed. No Aibek.
But the third time’s a charm, right? On Sunday afternoon I got a call from Batzul—Aibek had been located! We hopped in a taxi and made our way to the west end of the city. We were driven to a desolate, industrial area surrounded by auto body shops, where random vans were parked and people seemed to be waiting around for something. We waited in the safety of the taxi, but when no Aibek appeared, we cautiously stepped out and started asking strangers if they knew of our man. Eventually, one of them pointed us to a van, and lo and behold, Aibek was there!
Our first stop in our travels was Bayan-Olgiy. Bayan-Olgiy is a special part of Mongolia: This region is home to the country’s Kazakh minority, giving it a very distinct feel from the moment you arrive. The Kazakhs, who make up some 90% of the population of this province, adhere to Islam (rather than Buddhism, like much of the rest of Mongolia), and the predominant language is Kazakh, not Mongolian (though most people speak both). From my hotel window, I could hear the evening call to prayers.
The Kazakhs were first drawn to the high mountain pastures in the region in the mid-1800s, where they let their sheep graze during the summer months. Throughout most of the 20th century, they were an isolated, tight-knit community, and this region is considered even by people in Kazakhstan as the best-preserved example of Kazakh culture. One of the things it’s best known for is the Eagle Festival, which takes place every year in October.
I think my Kazakh colleagues were as curious about me as I was about them. I immediately started learning some words in their language. Instead of bayarlalaa for ‘thank you,’ they say rahmed. Amansasbaa is the common greeting, whereas in Mongolian it’s sain bain uu (or more casually, you can say salem in Kazakh). And learning to say tansganmaa huanshtaman (it’s nice to meet you) came in pretty handy several times later on!
Having finished our work at the branch quickly, our colleagues took us to see the main mosque in town, followed by a hike up a nearby peak to get a beautiful view of Olgiy, the Altai Mountains, and the river that flows from them. Later, the Branch Director and driver took us on a long and bumpy drive to Tolbo Nuur, a freshwater lake about 50km south of the city centre. Though it was still frozen, it was amazing to see a body of water (there aren’t many in Mongolia!).
Next stop: A visit to the Branch Director’s extended family living in the countryside! True to Kazakh/Mongolian hospitality, they welcomed us warmly and prepared a massive and delicious feast for us. It’s customary for people in Mongolia to welcome strangers—locals and foreigners alike—into their homes and feed them. It stems from their nomadic history, in which families would help other people who were passing through the area, or receive visitors from different parts of the country (for example, the capital) and exchange news with them. It’s a beautiful aspect of the culture here.
On our way back to Olgiy, we soaked in the peaceful landscapes of the countryside…
A picnic at Uvs Nuur
By midweek, we were bidding farewell to our new friends in Bayan-Olgiy and boarding another plane, this time bound for Uvs. We were welcomed at the airport by a small crew, and no sooner did we arrive at the branch than we got down to business. Client waivers, visits to borrowers, loan officer training—check, check, check! Then the branch staff treated us to a warm welcome dinner at a nearby Korean restaurant. We were starting to feel like royalty!
The following morning, we had certificates and tokens of appreciation to hand out to 5 Kiva borrowers who had repaid their loans on time (or early). It turned out that the Branch Director had invited the local television crew to film the small ceremony! They asked me to say a few words about Kiva, so I was happy to talk about the good work Kiva and XacBank are doing. It aired on the evening news that night. I guess that makes me famous in Mongolia!
Next on the agenda was a trip to Uvs Nuur, a saltwater lake that is the largest in Mongolia. Lucky us! We followed a road for part of the trek but veered off after a while to avoid muddy areas where our SUV could get stuck. We zigzagged across an open field and eventually made it to the water’s edge, where Mongolians love to come and take a dip in the summertime. It was a cool but sunny afternoon, and we took in the warm rays as we sat idly by the water’s edge and enjoyed the picnic our colleagues had packed for us. We couldn’t have spent a nicer time in Uvs!
Business owners, an ancient monument and a stolen dinosaur
The following week, we hit the road for two more aimags, Arkhangai and Bayanhongor.
There, we had the opportunity to meet some borrowers who told us about their businesses. It’s always rewarding to make the connection between the borrower profiles on Kiva’s website and the people who are actually behind them. It’s also nice to see microcredit working effectively. These lovely ladies passed along their thank you’s to their Kiva lenders… Allow me to introduce them.
While visiting these aimags, we also learned about some of Mongolia’s rich natural history. Not far from Tsetserleg, Arkhangai’s city centre, is Taikhar Chuluu, a large rock formation that juts out in the middle of a wide plain. Legend has it that a snake emerged from the earth one day, many moons ago, and a hero named Bökebilig forced it back and sealed off its cave with this rock. The rock has been revered by various civilizations since ancient times, as evidenced by the Mongolian, Tibetan, and Turkic inscriptions which can be found on it (the latter which dates back to the 6th century AD, although sadly, most of the inscriptions have been overwritten by modern-day graffiti).
And did you know that it’s possible to smuggle a dinosaur out of a country? Luckily, the one that was taken from Mongolia is now on its way home. Bayanhongor, which is part of the Gobi Desert region, is home to some of the incredible dinosaur fossils that have been unearthed since the 1920s. These include many dinosaur eggs and several Velociraptors (which of course you’ll remember from Jurassic Park!). One of the most famous discoveries is of a Velociraptor and a Protoceratops that were locked in battle and frozen in time 80 million years ago. You can also see exhibits such as a nest of newborn baby dinosaurs, and a mother protecting her young at the Natural History Museum in UB—that is, when they’re not out touring the world!
The Mongolian Messenger
I witnessed another curiosity during these BV travels. In a country where there are effectively no street names or real addresses, I’ve been intrigued by how mail gets delivered around here. You may know that the Mongolian Empire had a highly developed mail system at the height of its rule. People have assured me that when they receive mail—that is, anything that cannot be taped to their doors—they are given notices to go pick it up at the nearest postal outlet. Sounds reasonable, right?
But the truth is, Mongolians today have instituted an informal delivery system that would surely do Chinggis Khan proud. My edification began as Batzul and I waited in line at the check-in counter in the UB airport to fly to Bayan-Olgiy. A man was hovering nearby, and finally he approached Batzul. They exchanged a few words in Mongolian; he passed her an envelope, and she took down a phone number. I observed the whole interaction somewhat suspiciously.
‘What was that all about?’ I asked after the man had gone.
‘Oh, he just wants me to deliver something in Olgiy,’ she replied casually. And to my confused stare, she added, ‘It’s the Mongolian Messenger service.’
As if that explained everything! My jaw must have dropped. I started sputtering… What? How? Who?? I was full of questions!
These questions were somewhat cleared up when we arrived in Olgiy. As we stopped for lunch with our branch colleague, Batzul got on the phone and a short while later, a lady walked into the restaurant. Just a few words were exchanged before the envelope was handed over and the lady walked back out. I watched in fascination. ‘How did you know she was the right lady?’ I exclaimed.
‘Because I just talked to her on the phone,’ Batzul answered matter-of-factly.
‘But don’t you need to see her ID or something?’ I persisted.
‘No.’ We resumed eating.
This happened again and again until I finally started to believe in the system. Coming back to UB this time, we walked out of the baggage-claim area of the airport and Batzul delivered another envelope straight into the outstretched hands of a stranger. She knew him by the black shirt he was wearing, she assured me. On the way into the city, our driver stopped along the road from the airport, not once but twice, at seemingly random intersections where our little Messenger hopped out, delivered her goods to waiting recipients, and hopped back into the car. I was blown away.
The Kiva Coordinator-Extraordinaire
Speaking of this Messenger, delivering envelopes isn’t Batzul’s only talent. For the past four months, I’ve had the pleasure of working with her, and for good reason: She is a truly exemplary Kiva Coordinator. We’ve worked closely together, particularly during all of our branch visits for the BVs, and I must say we’ve made a great team. We get our work done quickly and efficiently, and even have time left to have some fun (as you now know).
But it’s not just that. Batzul is an impressive young professional all on her own. She is always on the ball with her Kiva work and manages several other projects on top of that. But the best part about her is that she takes immense pride in her job as a Kiva Coordinator, and also in the fact that her work is impacting the lives of many Mongolians. Whether we are running a training session together, or visiting a borrower, she’s been far more than just a translator. She elaborates by adding anecdotes and lessons from her own stock of experiences, including her interactions with branches, loan officers, and clients, thus adding colour and depth to the messages we deliver. She makes my job as a Kiva Fellow easy!
Just as I had thought, the opportunity to see so many different parts of Mongolia for my BVs was fun, rewarding, and incredibly enriching. And I have Batzul, the Kiva borrowers, XacBank, and all the incredible people at the branch offices we met to thank for that—so from the bottom of my heart, thank you everyone for a truly amazing experience!
Spring may have arrived in Mongolia, but for two Kiva staff who visited me in April, winter gave one last hurrah and dumped the largest snowfall I’ve seen since being here (a whopping 2 inches!).
By: Abhishesh Adhikari
One of the best parts about my Kiva Fellowship has been the opportunity I get to meet and interact with entrepreneurs. During the 4 months that I spent in Kyrgyzstan, I helped Bai Tushum (Kiva’s partner MFI) launch a new Startup Loan Product and met a wide variety of entrepreneurs all across that country. After I got back from Kyrgyzstan in January, I have been working on a new Kiva project called Kiva Zip, trying to expand it here in Chicago.
Kiva Zip is a new initiative to make interest-free, small business loans to entrepreneurs in the United States. This new lending model is based on community relationships whereby entrepreneurs can request interest-free loans (up to $5000 for the first loan) based on endorsements from organizations or prominent individuals in their communities. Lenders can view the profiles of these entrepreneurs on Kiva Zip’s website, and lend $25 or more at a time.
Spring has arrived in Mongolia! That means warmer weather (afternoons creeping closer and closer to the double digits)… and, of course, baby animals!
by Rose Larsen | KF20 | Dominican Republic
One of my first tasks upon arriving in the Dominican Republic was to visit 10 borrowers, chosen at random from all of the borrowers with ASPIRE (Kiva’s partner MFI), to verify data and find out how they are doing on their loan. This was an exciting but challenging introduction to daily Dominican life, as I navigated Santo Domingo and the surrounding areas via shared taxis, public buses, motorcycles, the metro and my own feet. I traversed bustling neighborhoods in the center of Santo Domingo, small towns in the mountainous interior of the country and everywhere in between, seeking out 10 lucky individuals to interview for Kiva’s audit of ASPIRE.
As a recent arrival in the country, it was a great experience to learn more about the Dominican Republic and what it’s really like to live here. Though each visit was uniquely interesting in its own right, four experiences stood out as having taught me a lot about what life is like for Kiva borrowers in the DR.
1. Dominicans have a very strong connection to the United States
I have often been surprised by the number of Dominicans who speak to me in near perfect English. Everyone seems to have a cousin or an uncle or a sibling in the States (mostly in New York and New Jersey), and many Dominicans that I’ve met have spent years living in the US as well. According to the census, in 2010 there were 1.5 million people of Dominican origin living in the US.
But what really drove that home to me was when I met my first Kiva borrower, Ramon, the owner of an internet center in the town of La Vega. He heard my accent when I spoke to him over the phone to arrange our meeting, and asked me where I was from. When I said the US, he told me he had lived there, all over – in New York, New Jersey, and Maryland.
As we began our interview in his little computer center, I was surprised to hear him answer my questions in perfect English! After months in Colombia of struggling to understand Kiva borrowers’ difficult Costeño Spanish accents (the ends of all words seem to be cut off), this interview was a breeze!
Like many other Dominicans, Ramón moved to the US in search of a better life, and spent 20 years there. Unfortunately his wife preferred the Dominican Republic and he had to move back. He said that here in the DR, it was much harder to make enough money to live on, because here, inflation is high but wages and income streams remain low.
2. Dominican food is delicious, and Kiva borrowers sure know how to cook
I arrived in Villa Altragracia in the early afternoon, and the branch manager immediately rushed me into the lunch room to eat the Dominican lunch they had ordered for me. It was a plate of rice, soupy beans that are called “habichuelas,” salad, and stewed beef – this is the national dish of the Dominican Republic and is called “La Bandera Dominicana,” or “the Dominican Flag.” The bandera dominicana comes in many variations – sometimes the beans are red and sometimes they are black; the meat can be beef, chicken or pork; and it is often accompanied as well by plantains. The meal I was served in Villa Altragracia was simple but really tasty.
After eating a satisfying lunch I followed a loan officer down the street to a Kiva borrower’s restaurant. It was only after finishing the interview and leaving that I found out that the ASPIRE branch office had ordered my lunch from there! I only wished I could have thanked her for the delicious meal.
3. Riding on the back of a motorcycle on a highway is terrifying, but loan officers do it daily
The second borrower I was scheduled to visit in Villa Altragracia was apparently not walking distance from the branch office. Since Villa Altragracia is a fairly small town, I agreed to get on the back of a loan officer’s motorcycle, so we set out motoring down the main road in search of Nailan.
I was very surprised when, 10 minutes later, I found myself merging onto Autopista Duarte, one of the main cross-country highways in the Dominican Republic. I clutched the waist of the extremely young-looking loan officer sitting in front of me who suddenly held my life in his hands. We stayed mostly on the shoulder, zooming by people selling snacks by the side of the road, and my heart leaped every time an enormous truck went by, going twice as fast as us.
20 minutes later I shakily stepped off of the motorcycle, and Nicolás, the loan officer, seemed surprised by how much the journey had scared me.
“I make this trip every day,” he said. “I used to have a car to do it, but the motorcycle is cheaper.” Gas prices are astronomical in the Dominican Republic – prices are currently at $5.25 per gallon! I had a renewed awe for the hard work that loan officers do to reach borrowers, even ones who are not very conveniently located.
4. Kiva Borrowers Span Many Economic Levels
My visits around the country were a great opportunity to see how normal Dominicans live – I visited their homes and businesses, met their families, and even shared meals with them. I was struck by how different each borrower’s life is – the pair of borrowers that I visited in the Santo Domingo neighborhood of Los Alcarrizos were the perfect example of these contrasts.
One borrower who left an impression on me was Papio. We found him spending the day at his parents’ home, a few kilometers down a dirt road outside of Los Alcarrizos, a working class neighborhood in Santo Domingo. He took out his loans to fund two of his businesses – a car and motorcycle repair shop, and a “colmado,” or corner store. He was spending the day overseeing construction on his parents’ land, where they raise chickens, bees and will soon rent out the new buildings they are currently working on. This was a man with multiple lucrative businesses – though perhaps the home was modest by US standards, he was clearly not struggling and in fact seemed to be flourishing, especially with the help of his Kiva loan! Though these borrowers are not what one normally thinks of when imagining a Kiva borrower, the money they borrow can go very far – Papio has multiple employees at his various businesses, all of whom depend on him doing well.
I spent an hour exploring the extensive acreage owned by Papio’s parents, as he pointed out different types of trees and plants that they grow – besides bees and chickens, they also produced mangos and avocados. I even got to share a meal with them.
Another borrower lived nearby, in the same municipality as Papio. To get to Elisabel, we bumped along down a dirt road filled with potholes, passing rundown shacks that housed whole families. The only day Elisabel was available to meet was Saturday, as she works the rest of the week as a maid in someone’s home – she finished paying off her loan a few months ago and unfortunately is not currently running her own business anymore.
Her home was very basic – a small wooden construction with a tin roof, and a tiny yard out front where a few chickens scratched in the dirt. The difference between Papio’s parents’ acres of land and well-furnished home and Elisabel’s shack where she, her husband and their three children lived was huge – it was hard to believe they lived just a few miles from each other. The difference in the quality of their lives was even more obvious.
Elisabel and Papio, though different, can both be helped by microfinance and the loans that ASPIRE and Kiva provide – though at very different levels. Elisabel’s loan was for $5000 pesos while Papio took out a $40,000 peso loan. The Dominican Republic has a lot of poverty, but as you can imagine, this poverty doesn’t always look the same, and it’s important to remember that Kiva borrowers don’t fit just one profile – they are as diverse in background as Kiva lenders!
Rose Larsen served with the 19th class of Kiva Fellows in Colombia and is now serving her second fellowship with KF20 in the Dominican Republic, with Kiva partner ASPIRE. Lend to one of ASPIRE’s borrowers today, or apply to be a Kiva Fellow!
Last week I started visiting some of Kiva’s borrowers with Transcapital, one of Kiva’s field partners that I’m working with here in Mongolia. While it was really encouraging to see Transcapital’s enthusiasm for Kiva at the head office as well as its various branch offices around Ulaanbaatar (UB), the new insights I’ve gained on urban poverty—both from these visits as well as just day-to-day life here—have left me perplexed so far, with far more questions than answers.
A short term solution?
Our visits began with a stop at Narantuul market, the largest outdoor market in UB where a number of Transcapital’s clients have retail outlets. At a first glance, Narantuul is a colourful and vibrant marketplace where vendors sell everything from food and candy, to winter coats, scarves, belts, jeans, baseball caps, cardboard, and more. It’s the place where Mongolians often go to find cheaper wares, which makes sense considering some of the staggering prices I’ve seen at Ikh Delguur, the State Department Store. We spoke to Bayasgalan, the proud owner of a shop selling winter coats and clothes, a long time client of Transcapital’s, and a Kiva borrower.
Other vendors watched us with curiosity as we chatted with her, and the mood at the market was lively despite the cold. But my translator friend, whose family had sold candy there, explained to me as we left that pretty much all the vendors there need continual loans to in order to sustain their businesses. Without loans, they can’t operate; but even with loans, they struggle to get ahead… which is anything but encouraging.
Harsh working conditions
The next day, we visited Kharkhorin market, UB’s second largest outdoor market, located on the other side of the city. The wares there were slightly different: I saw lots of shoes, but also an eclectic collection of hardware parts, sinks, ropes, tools, and other random second-hand items.
We had trouble locating one of the two borrowers we had to meet, so we wandered around for some time looking for her. In the meantime we met and chatted with Saranchimeg, who had used her loan to increase her supply of winter boots. We had been outside for about 45 minutes by the time we finished chatting with her, and I thought my fingers and toes might fall off. It must have been around -25oC that day with the sharp wind whipping through the stalls. But my thoughts were with the market’s vendors who stand out there all day long, day in and day out. My translator friend assured me that, just because they’ve lived in Mongolia their whole lives, it doesn’t make the cold is any easier for them to bear. I was humbled by how hard they work.
The reality for taxi drivers
We also visited with some taxi drivers. While a male taxi driver may not be one of the sexiest loans on Kiva’s website, you should know how hard these people work to support their families, just like anyone else. And for what? Being a taxi driver is a tough way to make a living in UB: A one-kilometre ride will earn a driver about 1,500 Tugriks (or 1.07 USD).
Moreover, the competition is stiff. Since cars have become ubiquitous in Mongolia’s capital, everyone has become a taxi driver. It’s an overhang from the early days of capitalism, when cars were not that common and the city’s residents would help each other out by giving rides. Now, you see people on the streets with their hand out all the time, and it usually only takes a few minutes for a car to pull over.
Another borrower we met lived in one of the outer ger districts, the slums of the city which lack basic services like running water and sanitation. He was middle-aged and had taken out a housing loan, but he told us that he had been a driver under the socialist regime. He explained that he had had much difficulty in finding employment in his profession. Recently, though, he has started applying for driver jobs again. It’s a mystery to me how he has managed to make ends meet over the years.
Survival of the fittest?
It’s easy to think that people don’t work because they’re too lazy, or because they simply refuse to accept lower-paying positions. This may be true in some cases. But there may also be more to the issue than meets the eye. Mongolia had its Revolution and transition to a market economy in the early 1990s and it seems the transition was difficult for those who were brought up and educated in the socialist era: Many of their skills and experiences have not translated well in the new economy. While a lot of the leadership I’ve seen in white collar jobs are shockingly young—in their late 20s or early 30s—street and market vendors tend to be in their 50s or older. And for many of them, their wares include no more than a couple handfuls of gum and candy, which can’t possibly bring in that much at the end of the day.
Maybe skills training is needed to support these people… or maybe it’s not that simple. Imagine being in your 40s or 50s and getting trained (or competing for jobs) alongside people who are a whole generation younger than you. And the longer you stay out of the workforce, the less confidence you generally have to return to it. One colleague of mine surmised that perhaps self-employment is the way to go for these people.
The fork in the road
Of course, this reflects only one facet of urban poverty here. Another, and perhaps larger, driver is the massive migration of traditional nomadic herders to the capital, as zuuds—extremely harsh winters—have killed off the millions of animals on which they depend for their livelihoods.
Mongolia has gone through some incredible changes over the past several years, thanks to the discovery of the largest unexploited reserve of copper, gold and silver in the world. Roads have appeared where they previously didn’t exist; herders have disappeared from the streets of UB; shiny new buildings have gone up; inflation has gone through the roof. It’s poised to be one of the fastest growing economies in the world in 2013.
There is immense potential for large-scale economic development and poverty alleviation in Mongolia. Microfinance is helping to tie things over, but how the country handles big issues such as corruption will ultimately determine whether the spoils will be shared by many. So far, everything I’ve taken in only seems to have raised more questions. I’ve only scratched the surface in terms of grasping the complex economic factors at work in this country, much less understanding the solutions.