Wednesday, May 16, 2012

Microfinance in Chogoria

            Village Hopecore International, in Chogoria, Kenya provides a micro-lending program that provides small loans to help groups of 12 people build their individual businesses and create a community they can lean on when paying the loans back.
To qualify for these loans, the group must go through some business education and an appraisal. Today (Wednesday), Carlo Abuyan and his driver and interpreter Michene were visiting six homes to go through the appraisal and interview process. If this process goes well, they will get their money tomorrow (Thursday).
Village Hopecore loans are carefully designed to help these families and businesses grow and succeed, if the funds are used correctly.
Every loan that is given is equivalent to 30,000 shillings which is about 400 dollars in the United States. The loan must be paid back in two years with a 9% interest and a 2 month grace period. This money is enough to improve the quality and output of their business. This money can make many things for possible for the people who meet the requirements.
The businesses the families have are tea and coffee farming, which brings a profit twice a year, and owning and selling animals and/or animal products, which can bring a profit all year once the animals are mature enough.
One of the most encouraged businesses is dairy farming. Kenyans take tea multiple times a day with milk, so there is a good market for it. Also, milk provides a lot of nutrition. The money given to the dairy farmers can be used to improve the conditions the cows live in. The first improvement often made is providing a cement floor, which keeps the cows healthier. Then they can repair or improve the building and possibly buy some feed. Some farmers might even choose to use the money to purchase another cow. Most of the families visited on the day I followed them had at least two cows.
Though Carlo is working with the microfinance portion of Village Hopecore International, it has little to do with his schooling. Carlo graduated from the University of California San Diego with a degree in political science. He then decided to join the Peace Corps. His first assignment was in Niger where he was attending women’s groups meetings, but the mission was evacuated due to terrorist threats. He was then reassigned to Village Hopecore, where he is working an assignment that resembles a job more than the Peace Corps normally does.
Carlo has faced many challenges working with the loan groups. “They see me and equate me with money,” he said. Often, people can become too dependent on the people who are helping them, and this becomes a real problem when they are expected to pay the loan back.
Carlo also has issues with people following through or taking the loan program seriously. On this particular day, one women had asked for the schedule to be changed so she would be available for her appraisal, but she still was not there. Carlo had to make the call that she was no longer able to recieve her loan. He sometimes feels like he is being rude, but you sometimes have to be.
There is also the issue of culture and language barriers. Carlo can speak Kiswahili pretty well, but in the town of Chogoria, English is often used. “You have to force yourself to use Kiswahili so you can use it when you go to the village,” he explained. The culture also thinks that if you are a young person, you should be extremely polite to the elders, which is not always suitable when collecting on a loan.
Carlo will be with Village Hopecore International until August of 2013. So far, he seems to have enjoyed the experience and his coworkers: “It’s a job, so it can be demanding, but it is also very rewarding.”
 
 

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