Tag Archives: micro-finance

Esperanza and Our Project

For the past two weeks, a group of 28 Northeastern students and 20 students from intec (instituto tecnológico de Santo Domingo) have been working with Esperanza International to figure out why the retention rate of borrowers who are Haitian is so low.  This has involved many late nights fighting over survey questions or  analyzing data, and many long, hot days in the field.

To start, Esperanza is an MFI (micro-finance institution) in the DR as well as in Haiti.  They are a Grameen Bank replicant (remember Yunus and that Nobel Prize?) which means they make their services available to the poorest of the poor, especially women.  Women are targeted due to their usual exclusion from traditional banking services and for their direct impact on the well-being of the family. ie men tend to spend the money on vices and consumables, whereas women take care of their children’s health and schooling first and are better at planning for the future of their businesses.  In order to get small loans without collateral, these women are grouped together in fives, and are responsible for the other group member’s bi-weekly payments if they show up without sufficient cash.  Finally, the loans are for business-use only, have interest in the neighborhood of 30% on a declining balance, and are typically for a six-month period.  Also, for those interested, Esperanza is a Christian organization.  But that’s for another day.

So back to our project.  We were given this assignment by Carlos Pimentel, the CEO of Esperanza.  I’m told this sort of interaction between students and MFIs is unheard of in the industry, especially with so much personal attention from a CEO.  We had classes taught by Professor Shaugnessy about Social Business, Social Entrepreneurship and Micro-credit, divided up into color groups (Rojo!) and dove into a survey created by Dtra Lourdes of Esperanza (a Cuban!), which was meant to be used with current and former Haitian borrowers.  In order to speak with these associates, we went into the field in Santiago, Puerto Plata, Santo Domingo Norte y Los Alcarizos which are areas of particularly low retention rate of Haitian borrowers (in La Romana they do just fine).  We gathered over 200 interviews that covered information like literacy, numeracy, and sending remittances to Haiti in order to make recommendations to Esperanza about how to retain more Haitian borrowers.

What I can tell you now is that we have no idea.  Statistically, there is no reason why these borrowers aren’t doing well, and that just doesn’t sit well with me (or pretty much anyone else here.)  Our presentation to Esperanza of our findings was therefor uncomfortably short, and based on observationally-based recommendations backed up by outside research of the micro-credit industry.  While I was discouraged by our findings, the six presenters (4 NU, 2 intec) did a great job.  I was particularly impressed by all the people who did not present but wanted to and still stepped up to do the behind the scenes work.  In the end, I think Carlos and the Esperanza team were impressed by our work, and I’m glad someone at their organization will be digging deeper into the issue in the coming months.

What is a Human Right?

Freshman year in all my classes there was The Marine.  Old for a freshman and a fellow  International Affairs major, he was always on time and often wore his mil backpack.  Manifesting himself as the booming faceless voice from the back of the class, the professors always seemed overly eager to both hear and honor him.

One of his biggest stands which professors bent over backwards to not disagree with was that electricity is a human right.  His experience in the Middle East had made this overwhelmingly obvious to him, but he had a hard time pointing to the piece of international human rights legislation that backed him up.  Personally, I think he was getting more at the need for light and perhaps the ability to cook in a safe and effective way, neither of which has to necessarily involve electricity.  (I would now argue that electricity is necessary in order to honor several clearly-defined rights, such as to food security and bodily security i.e. protection from rape and other forms of bodily harm that befall women who collect wood at night.)

Now that I’m spending so much time with micro-credit, I’m  starting to understand how their services can be human rights, especially when we’re discussing a certified bank like Grameen.  People without access to insurance, credit and savings a become vulnerable to all manner of incredibly harmful and undignified situations.

These can include, but are not limited to:

  • begging
  • prostitution/human trafficking
  • food insecurity
  • losing access to their children

Someone without the ability to borrow money, something we do all the time in the US, would have an extremely difficult time raising their station.  Someone who does not have secure savings cannot plan for the future, is subject to robbery for the cash they most likely store in their home.  Sometimes, human rights is not just about the theory but about pragmatic on the ground approaches like selling water instead of giving it away in order to make it sustainable and accessibly.  In this instance, I think our modern world and insistence on capitalism makes access to credit and savings (in one fashion or another) necessary in order to live a dignified, secure life.

Lessons Learned from Jacqueline Novogratz

Jacqueline Novogratz, founder and CEO of the Acumen found, world traveler, social entrepreneur and all-around badass wrote the book The Blue Sweater.  Ms. Novogratz is one of a growing group of business people who believe that we can combine the goals of philanthropy with the methods of for-profit business and come up with a sustainable way to help people.  The emphasis is on providing opportunities for people in developing countries to make their own money, rather than simply giving it away.

I’ll be writing about the book and these ideas quite a bit on here, since I greatly admire her path in life and would like to emulate her.  Before a formal review, though, here are some take-aways from her book:

  • Don’t create more dependence
  • Invest in good people
  • Listen.  Really, really listen.
  • Involve people in the formal sector of the economy
  • If you want to be taken seriously, take everyone else seriously.  That means real logos and an office, but it also means that if someone defaults on a loan, there needs to be some sort of punitive measure.  Just because the work is motivated from a place of humanitarianism doesn’t mean your customers and clients can do whatever they want.
  • Focus on building upon systems that are already in place.  Starting scratch often means failing.
  • Sell to them on their terms, not yours (know your audience)
  • Everyone can contribute
  • You need feedback, something the market can provide that is often missing from traditional philanthropy
  • Don’t leave people behind
  • The world’s poor are active customers, not passive receptacles of charity
  • We are all smarter for knowing one another

It is worth noting, I think, that her book was not ghost-written, as far as I can tell.  I highly recommend that you read it, even if this isn’t usually your thing.

What is Service?

Is it okay to be giving service to an organization that is really just a group of women making money?  Yes, they’re not as well off as those in the US, or as our translator.  But they have clothes and food and look pretty healthy and happy.

I’m not going into a poor orphanage and helping them deal with an overwhelming amount of children.  I’m going to a small corporation and trying to tell them how to make more money.  In the US, I would call that consulting.  Does not getting paid for something automatically make it service?  Yes, it’s voluntary, but is it community service?  I came here to learn more about the non-profit world, and specifically to see the hands-on nitty-gritty of micro-finance in the field.  My first lesson?  Micro-credit hasn’t failed, it’s just been hijacked. This is a micro-enterprise, a small, locally-owned (what isn’t in Benin?) business.  This is not a lending organization; it’s not even one of their beneficiaries, since they don’t receive loans.

Is it still volunteer work if you’re getting something in return?  If you’re getting a grant, soft power, induction to an honor society, brownie points for your sorority or college credits, it seems you are being paid–just not in cash.  Of course, reductum ad absurdum, and I’m reminded of that Friends episode when Joey tells Phoebe there’s no such thing as a truly selfless act—you always get recognition, gratitude, or at the very least a nice warm fuzzy feeling inside.

But who says service has to be special, sacred and selfless?  What’s so wrong with being selfish?  How come everyone else can be selfish in their career path, but not lawyers and aid workers?  Just because your life is about improving the world and helping others doesn’t mean you have to be a martyr to do it.  And if you do a good deed, does it really matter what your motives were?  If the road to hell is paved with good intentions, can’t the road to heaven be paved with bad ones?  It doesn’t matter why you helped a little boy learn to read, in the end he’s still farther along in his education for your help.

What About Benin?

I’ll be going to France on May 8, and after a week in Paris I’ll go to Benin until June 5.


Benin. It’s a small country in West Africa.  It’s mostly known in history for its sad part in the slave trade as a major departure port.  I’ll be spending some time in Cotonou, as well as the capital of Porto-Novo

The Basics

Map courtesy of the UN website

I’m going through Northeastern University and the Dialogue of Civilizations program.  Instead of taking summer classes, I’m doing this.  I’ll get the normal summer credit for it (8 credits/two classes) and will be graded and such.  It’s like what I did in Egypt, except entirely different. 🙂

French is the official language of Benin, so I’ll be taking some lessons while in Paris and practicing my rather dormant French skills while there.  Many people also speak Fon, of which I know nothing, and Yoruba, a language that found its way to Cuba (and modern Cubañol) via the slave trade.  The country is considered very safe, but is severely lacking when it comes to infrastructure.

For our safety/for the sake of NU’s lawyers, we aren’t allowed to ride on motorbikes and will only be eating from a select few restaurants.  I have malaria pills and got my yellow fever vaccine, whose injection site still kinda hurts.  Blast, yellow fever, you’ve done it again!  I’m waiting with bated breath for my visa to come back (this seems to be a theme with me…) and already scoping out luggage and drawing up packing lists.  Here we go again!


While in Benin, we’ll be meeting up with local NGOs (non-governmental organizations) to learn more about the country, such as development, culture and politics.  We will each be working with a local NGO for a few weeks, ranging from health care to orphanages to micro-enterprise(!) and lending a hand any way we can.  More on this later, since it’s most of the reason I chose this program.

Songhai Center

I’ll be living in the Songhai Center in Cotonou.  There are several of these throughout the country, and they are used for training Beninese people about agriculture and such.  It’s also thoroughly Green with a capital G, with each part of the center helping to fuel another.  Which brings up another point: I’ll be taking chilly rain barrel showers for most of the summer.  Basically, I’m going to refer you to the video contained in the link below, courtesy of BoingBoingTV, because it does a far better job of explaining than me.

Songhai Video link

Back to school, back to school

…to prove to daddy that i’m not a fooooooool.

Sorry, I can’t help it, we were talking about Billy Madison today and it just seemed so fitting.

Today was the first day of classes and I had a ball. We are in three separate classes, and mine is the largest with eleven people.  Our ustadtha (oostatha, teacher) is a woman named Khowla (like cowla, but with a gutteral, phlegmy khhhh going on) who is really sweet.  She is pretty much letting us set the pace for the class, and she plans a lot of activities to break it up and keep us always speaking.  We have class monday-thursday for four hours a day, 9-11, with a fifteen minute break partway through.  We take class in the dorms of AUC, just down the street and around the corner from the Flamenco, our hotel.  Khowla gave us an impromptu lesson on how to effectively ride a cab in Cairo (read: not get ripped off) and I can’t wait to practice.

Class is a little difficult for a few reasons.  First, I’ve only been taught traditional, which is the Arabic of the Quran.  Every country has its own colloquial, and the idea is that if you know traditional you will be understood everywhere.  But really, think about how silly you would sound speaking in the language of the Bible.  Now picture a child speaking in the language of the Bible.  That’s approximately how dumb I sound on a daily basis.  The second difficulty is that at NU the focus was on reading and writing, not vocab.  I didn’t even know how to say “sorry” (assif) until today.  Luckily, my brain is now in Arabic mode, and colloquial Arabic is very much influenced by French.  We’re pretty much entirely focused on conversation, which is great.  Khowla’s promise is that if we work hard we will truly speak Arabic by the time we leave here, and I’m inclined to believe her after today.

After class, we went to St. Andrews, which is a refugee center in the downtown area.  We had our training session so that we know what to expect when we volunteer there.  The center serves anyone from the 20 million-strong refugee population in Ciaro, coming predominantly from Sudan, but also Eritrea, Iraq and Somalia.  The center provides classes for children and adults, so that they may learn English and Arabic, get a high school diploma, find a job, learn a trade, or some combination of those.  It is based out of a church and recieves a lot of funding from faith-based groups, but is open to everyone.  I think I know where I’ll be sending my white guilt check when I get a big girl job.  Basically this is the kind of thing I want to do with my life–the intersection of politics, culture, education and non-profit.  With a little faith thrown in for good measure.

We’re each volunteering two hours a week at St. Andrews, where we (with at least one buddy at a time but usually more) will hang out in the library and do our homework until students from the adult program come for help.  We will then tutor them in English, which could mean help with homework or conversation practice.  The center also has a co-op called The Arc, where artisans create handicrafts that are sold in bazaars and at the center.  They also help teach those interested how to sew, knit, quilt, paint etc, fronting the money so that the refugees can afford to get started and make some money.  They’re looking to become more international in their market, something I would love to help make happen.  Abigail from St. Andrews is going to talk with Cynthia, one of our NU leaders, about exploring that, and it might be our group’s service project.

NB: I’m trying to sprinkle in some Arabic phrases, written in either transliteration or phonetically, depending on my mood.  I hope you enjoy them, since I won’t be able to stop saying things like in shaa allah (god willing) and shukran (thank you) when I get back.

Addendum to the safety issue: we have a plainclothes security detail.  He has a machine gun under his really nice suit, and is very staunch about following orders.  His name is Tawhid, and he’s actually a really nice guy, which I learned today because we had a chat after I was the only one who could successfully ask him his name (insert victory dance here.)