Microfinance: Going the Extra Mile

It’s no secret that the world’s poor lack many things. Access to suitable housing, sufficient and nutritious food, clean water, education and security are amongst the most basic of human rights to which much of the world does not have adequate supply. At the heart of this unfortunate picture is an inherent lack of resources and opportunities. Moreover, scholars, economists, governments, and NGOs have earnestly debated over the most effective models of development in order to serve these disadvantaged populations in the most sustainable manner that encourages self-sufficiency rather than institutional dependency. In the 1970s, Microfinance emerged amongst these models and has since seen great success in both the for-profit and non-profit sectors as it’s given millions of people access to much needed capital.  – See more at: http://www.adelantefoundation.org/en/read-our-blog/42-from-the-field/175-microfinance-going-the-extra-mile#sthash.YW83MiSE.dpuf

No es ningún secreto que a los pobres del mundo les faltan muchas cosas. Las viviendas adecuadas, comida nutritiva suficiente, agua potable, la educación y la seguridad se encuentran entre los más básicos de los derechos humanos en los que gran parte del mundo no tiene acceso adecuado. Lo grave de este lamentable panorama es una falta inherente de los recursos y de las oportunidades. Además, los especialistas, los economistas, los gobiernos y las organizaciones no gubernamentales han debatido seriamente los medios más eficaces de desarrollo, con el fin de servir a estos los sectores más desfavorecidos de la población en la forma más sostenible que promueve la autosuficiencia en lugar de la dependencia institucional. Durante la década de 1970, las microfinanzas han surgido entre estos medios y desde entonces han experimentado un gran éxito tanto en el sector comercial como en el sector sin fines de lucro, ya que ha dado a millones de personas el acceso al capital muy necesario. – See more at: http://www.adelantefoundation.org/es/lea-nuesto-blog/42-from-the-field/175-microfinance-going-the-extra-mile#sthash.dogU221T.dpuf

Product Innovation with a Local Business

Maria runs her business with Lourdes and Jennifer off a main street in the city of El Progreso

Cositas is a small store in El Progreso, Yoro that sells materials and accessories for jewelry making. Just a few blocks from our El Progreso Branch Office and the central plaza, Maria, Lourdes and Jennifer work together to offer products and classes related to the making of jewelry. The three women’s expertise in training and design made them an ideal partner for our Product Innovation Workshops supported by Women’s Empowerment. Their knowledge and ability to work effectively with our clients resulted in a demand to bring them back for a second workshop in October after offering the first one in September.

I was thrilled to have been greeted by Lourdes and Jennifer immediately after arriving to their city!

In December during a visit with clients in the El Progreso and Choloma zones, I had been hoping to catch up with the women as well. As my luck would have it, the hotel I would be staying at is located right across the street from their business! Before I had even finished checking in, Lourdes had already spotted me and stopped over to greet me. While chatting with her and Jennifer I learned that upon the request of several of our clients, they had made the trip down to Intibucá to offer more of their jewelry making materials.

Trusting their expertise from my experience with them at the previous workshop, my visit to them had a second motive: getting a gift for someone I know who is interested in making jewelry. While Lourdes attended to other customers, Jennifer helped me out in bringing out the colors and styles that would best suit my friend and even sending me off with a couple different earring designs based on the beads I had bought as inspiration.

Many clients already had several pieces of jewelry ready to sell before the two day workshop had ended!

Just like with my friend, the making of jewelry gives our clients an additional source of income. Most clients who I spoke with seemed to plan on utilizing their new skill as a supplement to the businesses in which they have always invested loans. From women selling vegetables in the market to others selling cosmetics, these women already were identifying how they would get started making sales. And thanks to a new innovation developed out of the workshops by our Manager of Operations, they were able to get started right away.

One client’s young daughter proudly shows off her mother’s new products!

The first workshop had inspired Oscar to create a new product: the Always Enterprising Loan! Many clients had been eager to get to work with their new skills but hadn’t been prepared to make material purchases at the workshop. For the second workshop in October, we tested this new product with great success. Clients were thrilled to be able to get started right away and several even spent their downtime between the workshop days working with the material purchased with the loan to produce the jewelry.

While the loans gave our clients a small investment to start up their businesses, many had already run out of the necessary materials less than two months after the workshop had been held! On their return trip down to Intibucá, the women made sales to 10-12 of our clients—more than one third of those in attendance! The funding provided by Women’s Empowerment and the relationship created between Adelante and Cositas creates a dynamic network in which three organizations organized around women can support each other’s mission. Maria, Jennifer and Lourdes’ friendly and instructive manner with our clients, combined with their excitement for our own program makes future work with them something to look forward to.

On her visit to Intibucá for the workshop, a few hours from home, Jennifer got a chance to do a little sightseeing of her own!

Holiday Preparations in Intibucá

The twin cities of La Esperanza and Intibucá were already in full holiday swing last week. With many locals, I ended the week at a Christmas event in the main plaza filled with dancing, music and ponche–a delicious pineapple drink served hot to cope with the cold weather.  Paintings from Intibucá, Marcala and Choluteca were on display farther from the stage, giving people a chance to appreciate the local art scene as well.

Here, a group of dancers perform in La Esperanza’s main plaza.

When I arrived to the plaza, the event was already underway, with a folk dance performance. The act ended with a few audience members of all ages brought up to dance. A young singer came up next to perform a couple songs, followed by a reggae duo from Corozal, a small town outside of La Ceiba where we also have clients.

Amidst the holiday preparations, Adelante clients were busy at work preparing for greater sales. It was great to meet so many women preparing their businesses for a Christmas sales boost. Although the increased profits made during the Christmas season will unlikely be kept up for the year to come, the extra money helps these women to save, and to offer their families a little bit more in the weeks to come.

On a stroll through the market with another Credit Officer, Yovanny, we saw Ricarda, who had stayed late at the market just to chat with a fellow Adelante client. Ricarda had sold out of her tortillas quickly and was happy to spend a couple hours supporting her friend as she finished off her tortillas sales. With such high demand for the staple, they don’t have to worry much about competing with each other. And by the time I met with Santos, she told me to come back early the next morning so that I could take a picture when her basket would still be full of rosquillas, quesadillas and other sweet breads popular in the area.

In anticipation for Christmas, Carmen has been busy making dulce de leche and preparing delicious chicken tacos.

I met Cintya at her stand, who has enjoyed greater shoe sales as customers are busy buying gifts and looking for new shoes for themesleves. Carmen was hard at work making dulce de leche when I popped in for a visit and lunch with our Intibucá Office Supervisor Ethel and Carmen’s Credit Officer David. From her home, Carmen prepares typical food like the tacos we ordered for lunch, but also started making and selling dulce de leche a couple years ago.

Ethel gets ready to dig into her order of chicken tacos!

Serapia’s convenience store will soon be ready to sell meat and other frozen products, thanks to her coming Individual Loan!

Serapia, however, must be the most joyful of them all. I met Serapia at her house where she lives with her husband and four of her five children. Here she runs a small convenience store and raises animals to sell. With Christmas approaching she has already sold two of her three turkeys and is getting ready to sell her three pigs. Unfortunately, she has struggled to keep her chickens safe from the mountain cats who come out at night, making these less profitable.

After four loan cycles Serapia has qualified for an Individual Loan, which she will be receiving this Friday! The loan of L. 12,000 ($600) will allow her to purchase a freezer for her store. With a new freezer, she’ll be able to see her profits increase, telling me, “The fridge I have is only good for storing drinks. With a freezer I’ll be able to start selling meats–products that my customers have frequently asked me for.”

From her home, Serapia is able to engage in multiple activities to support her family–selling basic goods, raising animals, attending to household chores and caring for her children.

She started her store three years ago with about $40 of earnings left over from selling her fattened pigs. After hearing about Adelante and becoming a member of a local assembly, Serapia is now able to make much larger investments into her business. Her first group loan was for about $192 and is now paying back a loan for about $305. The Individual Loan will now give her the opportunity to invest and grow her business in a way that she would not have been able to previously.

The Christmas season is a busy time for everyone at Adelante, as many clients look to take out new loans to take advantage of the holiday boost in the economy. As for me, I’m looking forward to my first Honduran Christmas and New Year. The holiday spirit shown in Intibucá and La Esperanza was just the thing to get me ready.

Erika: One New Client’s Bright Young Daughter

Erika models the necklace she made after the first day of the workshop.

I met Erika during our Jewelry Making Workshop in Intibucá during October, our most recent offering from our Product Innovation Workshops. At nine years old, Erika was the oldest daughter of a client at the workshop. As the workshop got started, Erika and her mother Rosa sat with the other women who had attended the first workshop, about a third of those in attendance. While her mother and the others at her table picked out new materials to work with and the newcomers got started with their tools, Erika reviewed the beads and material available and observed her mom and the others as they got to work. Erika’s excellent grades and hard work in school made it possible for her to miss two days so that she could accompany her mom to the workshop and learn how to make jewelry with her.

With Erika’s help, Dulce Maria is able to balance learning a new skill with caring for her son. By selling jewelry, Dulce Maria will be able to earn more money and better support her family.

While shy at first, Erika gradually began to talk to the other clients, and eventually became comfortable with me. As she adjusted to the setting at the workshop, Erika started to stray farther from her mom’s side, taking on multiple roles. In addition to making necklaces and earrings at Rosa’s side, Erika helped the other mothers out by acting as babysitter for the younger kids so they could focus on the workshop, cheered on clients who were having trouble with the tools and even helped me out by taking a few pictures. Although she enjoys helping her mother and coming up with new jewelry designs, Erika’s favorite class is math and she wants to be a teacher when she grows up. With her incredible ability to learn, she also revealed a natural teaching ability. Ana is a new client with Adelante and this was her first workshop. While she struggled with the tools, Erika came over to give her some encouragement, telling her, “You just have to remember to keep your hands still. I know you can do it!”. With Erika’s help, Ana learned to relax a little bit and was proud to show me the bracelet she had finally made when I returned to her work station. 

Maria (left) helps Erika become comfortable with the jewelry tools, while her mother looks on.

During the two day workshop, I got a chance to meet several inspring clients but was most deeply impacted by the potential that Erika had shown. Rosa tells me that they live in a somewhat isolated area in the mountains outside of La Esperanza and didn’t have electricity until just four years ago. Like her daughter, she also values education and had worked hard for years so that she could finish her high school degree just a couple years ago, while simultaneously raising her two children. Her economic responsibilities also extend to her mother who has become very sick and has lost the ability to talk. To help her husband cover their family’s expenses, Rosa makes tacos, enchiladas and tamales to sell outside the local soccer field during games every Sunday. Since the first Jewelry Workshop, she has begun to implement this new business and has now taken out her second Adelante loan, a much larger loan than her first–about $370 compared to $165. This larger investment signals to me that her new business venture has taken off well. With Erika’s ambition, Rosa’s new business and both of their hard work, Rosa will see her daughter grow up with greater opportunities than she was offered as a young woman. Like so many of our other clients, Rosa knows that it is up to her to shape the future for her children.

Rosa and Erika stand proudly to accept Rosa’s Workshop Certificate. At the end of the day Rosa told me, “And what she doesn’t know yet, I’ll teach her!”

Adelante and our clients in Intibucá are very appreciative of the support brought forth by Women’s Empowerment International. Without their funding and support, these workshops would not be possible. 

Alleviating Poverty in the Lenca Corridor

A rural scene from Intibuca

In the Western highlands of Honduras, achieving the basic necessities in life is a challenge.  This area is known as the Lenca Corridor, named after the indigenous group that inhabits its rugged mountains, primarily in the departments of La Paz, Intibucá and Lempira.  The Lenca are an indigenous minority and have an estimated population of 100,000 people in Honduras. During the Spanish conquest, the Lenca resisted colonization and fought a decade-long war until their leader was assassinated.  This warrior’s name would become the currency of present-day Honduras, the Lempira.  In spite of Lempira’s heroic legacy, the Lenca remain marginalized in a predominately mestizo country.  It is no coincidence that the poorest departments of Honduras are located in the Lenca Corridor.

Maria Sabina & baby boy

Adelante currently serves the Lenca Corridor with microcredit through its branch office in La Esperanza, Intibucá.  Many of its clients are Lencan women whose struggles to improve their quality of life are illustrative of the region.  Maria Sabina has been a client with Adelante for the past two years, and is currently paying back a loan for L 6300 or $332.  Akin to many Lencan households, Sabina’s family relies on agriculture for subsistence and also to earn cash.  Owing to the cool climate, they not only cultivate corn and beans, but also potatoes and other vegetables too.  Sabina travels over an hour by bus to the market in La Esperanza in order to sell their surplus.  When the family’s plot of land is not producing, Sabina also bakes and sells bread to supplement her family’s income.  During the rainy season, roads deteriorate and often the bus can not reach Sabina’s distant community, so she has to walk several kilometers until she can catch the bus.  The rural villages that dot the slopes of the Lenca Corridor commonly lack basic infrastructure, such as roads, electricity and running water. Sabina’s community is no exception.

Sabina and her husband have six children, ranging in ages from a 1 year old baby to a 17 year old son. Of her six children, three attend a local primary school, but her two teenagers must help out to support the household. On most occasions, Sabina’s 13 year old daughter accompanies her to the market in La Esperanza.  Affording a secondary school education for their children is a challenge for most Lencan families.  Sabina’s small business ventures have lifted the family out of extreme poverty, but she will not be sending her daughter to secondary school this year. Sabina hopes that as her business grows in the future, she will have the income to offer her children a better education.

As part of an effort to alleviate extreme poverty in the Lenca Corridor, Adelante has included topics on agriculture in our series of Product Innovation Workshops in 2012.  Clients like Sabina learn how to improve production and increase profits from agricultural activities.  Other workshops on crafts and food preparation also allow Lencan women to diversify their businesses in order to enhance household income.

Rosario & daughter at flower-making workshop

Maria Rosario, a long-time client who also sells vegetables in La Esperanza, attended a flower-making workshop in February.  Rosario brought along her 12-year old daughter to the event, commenting, ¨It’s good that she came because she can make these products too, it’s important since she will soon be finishing primary school and if she wants to keep studying she will have to work hard!¨  Like Sabina, Rosario has achieved a better standard of living for her family, but a secondary school education for her daughter remains out of reach.  Fortunately, with the skills they have learned at the workshop, mother and daughter will be able to develop a new stream of income.

The poverty that pervades daily life for so many women and their families in the Lenca Corridor is one of the reasons why Adelante is keen to expand its operations in the region.  Already 1,000 women and their families are climbing out of extreme poverty as a result of our microfinance-education program.  We are excited to be expanding further with generous contributions from Women’s Empowerment International and the Rotary Foundation. Stay tuned to this blog to read more about how Adelante’s unique approach to microfinance is changing lives in the Lenca Corridor and across Honduras!

Microcredit in Jesus de Otoro, Intibuca

During a recent trip to the Adelante Foundation office in La Esperanza, I spent a day in the nearby town of Jesus de Otoro, in the department of Intibuca.  A 45 minute bus ride from La Esperanza, Otoro is nestled in a valley making the climate much hotter.  Large segments of the fertile valley are devoted to rice cultivation, but the people of Otoro also produce beans, corn and coffee.  The rice fields are primarily owned by large land holders, so a common outlet for earning wages is through the rice cultivation sector.

A Tour from a Client turned Credit Officer

I am invited to visit Otoro by Lilyana, a credit officer who manages the Adelante Foundation credit pools in the area.  Before becoming a credit officer only four months ago, Lilyana was an Adelante Foundation client.  Lilyana thought the transition might prove difficult given that she would be the credit officer assigned to her old assembly group.  Thankfully, the transition has gone smoothly and Lilyana receives the support of her compatriots.

Central Park, Jesus de Otoro

Touring the town, Lilyana points out the municipal courthouse, the town hall, central park and the Catholic Church.  Otoro is well serviced with small supermarkets called ¨bodegas¨, banks, a municipal market, primary and secondary schools, private bilingual schools, and an ample supply of small shops selling goods from appliances to used clothes.  Walking around town, I am shown numerous businesses belonging to clients of the Adelante Foundation, including what seems like half the storefronts in the municipal market.  Despite the municipality’s apparent advantages, there are few job opportunities other than farming.  Most of the farm work is carried out by men, so women especially have fewer options for employment.  Small businesses represent an important economic activity for the women of Otoro, and the microloans offered by the Adelante Foundation enable these enterprising women to increase their income through small business ownership.

The Clients of Jesus de Otoro 

Near the center of town, I met the elderly owner of a well-stocked pulperia (convenience store), Ercilia Funes Perdomo. Ercilia has been operating her store for years, and in the past, took out loans from other institutions.  She confesses that the Adelante Foundation offers the best product, and affirms she will never go back.

Ercilia & her Pulperia

¨Other institutions demand more, they make you sign too many papers, they take off fees for administration costs and social security, and they waste a lot of time,¨she states.

Over the course of the day, I hear similar accounts from other clients who agree that the Adelante Foundation offers microloans at reasonable interest rates, without extra fees, and with no collateral required, using instead a method developed by the Grameen Bank over thirty years ago, called solidarity group lending.

Eva Salazar

One of the most adamant supporters of the Adelante Foundation is Lilyana’s own mother, Eva Salazar.  Eva founded the first assembly group in Otoro when the Adelante Foundation had just begun offering microloans in the municipality.  Eva was also the first client in Otoro to receive an individual loan in order to expand her product inventory significantly. Presently, Eva sells an array of manufactured goods, such as toys, school supplies, shoes, gardening accessories, jewelry, and so much more, just look at picture of her store!

Eva´s Store

With her most recent individual loan of L 25 000  or $1,200.00, Eva invested in creating a separate space for her growing business.  Prior, her business occupied what is now the living room in her home.  Eva built an additional room off the side of the living room to develop a proper storefront.  The roof, tile flooring and cement walls totaled nearly L 20 000 or $1000.00!  Without an individual loan, she would have never been able to undertake this construction project.  Currently, she is paying off a group loan of L 3 000 or $150.00, but she hopes to withdraw another individual loan for the holiday season to enhance the inventory of her store.  Similar to North America, the holiday season means greater demand and more profits.  Eva echoes much of what Ercilia says, and she adds, referring to her fellow borrowers, ¨you must appreciate the Adelante Foundation and take care to pay your loans, there are no other institutions like the Foundation, so people must take care of it and pay back their loans.¨

Next Time in Otoro

I look forward to returning to Jesus de Otoro in the future, and I have two great reasons for another visit.  The clients I had the pleasure of visiting are based around the center of town, and akin to any other municipality, the people who live in the ‘aldeas’ or communities on the periphery are likely to share a different perspective.  Secondly, most of the clients I met are part of the enormous Santa Cruz assembly group, totaling 53 women!  An assembly group of that size is normally discouraged, but Lilyana informs me that the women refuse to downside and that the group manages well. Stay tuned for when I get a chance to attend such a lively assembly meeting, and of course, take a picture!

Orientation

Sitting at a desk in an office, receiving training sessions and reviewing informational materials are familiar activities for most job orientations.  On the contrary, starting out as an International Field Correspondent for the Adelante Foundation necessitates jumping into a role that does not have a training manual.   As an International Field Correspondent, I travel throughout Honduras to meet with clients of the Adelante Foundation, in hopes of bringing their stories to the organization’s generous supporters.

My goal is to report on the stories and other tales from the field, which I trust will make readers feel more connected to the mission of the Adelante Foundation, despite often being so far away.  I would also like to bring forth the issues that shape the livelihoods of the Honduran people.  In doing so, I too will learn a great deal more about this diverse country’s current struggles and past legacies.  In order to accomplish these goals, orientation includes getting to know all of Adelante’s five offices (La Ceiba, Tocoa, El Progreso, La Esperanza, Choluteca), and the eight departments or states (Atlantida, Islas de Bahia, Colon, Yoro, Cortes, Intibuca, La Paz, Choluteca) these branches serve.

The First Few Weeks

In only three weeks, I have already familiarized myself with three of the five branch offices (La Ceiba, El Progreso, and La Esperanza), and four of the eight departments (Atlantida, Yoro, Intibuca and La Paz).  At each office, the goal is to meet the team, learn about the area, and meet clients either individually at their homes or during assemblies (gatherings where clients receive business related education every two weeks).

La Ceiba

I jumped into my new position by visiting assemblies around La Ceiba. Although more urbanized, clients still work hard to provide their families with the basic necessities such as food, electricity, and water.  The women I met in La Ceiba told me of their investments in education for their children, a difficult goal to achieve without sustained income.

Cattle Jam, outside El Progresso

 

 

 

The following week I set out to El Progreso, a city whose growth has been spurred by nearby San Pedro Sula, the economic center of Honduras.  Visiting clients in the communities outside the city, I passed endless plantations of bananas and sugar cane.  Women spoke of their husbands who labor in these fields, receiving minimal wages for long days of arduous work.

Heading west along the north coast from La Ceiba to El Progreso, the landscapes of tropical vegetation, densely inhabited areas and cash crop plantations could not be more different from where I am currently, La Esperanza.

In the highland town of La Esperanza, pine tree topped mountains are evidence of a cooler climate and more rugged terrain.  Communities are often many kilometers apart from one another, and there are few paved roads.

 

 

First Impressions

After meeting a few clients, I realized that my orientation will be more than just a traveling schedule over the next two months.  Adelante’s clients are generally more than willing to share their opinions, discuss their loans and display their businesses.  Nonetheless, I quickly noticed that whipping out a pad of paper and a pen makes even the most extroverted woman nervous; no doubt a formal interview makes me anxious too!  Instead, casual chatting with a client or even a group is a better way of getting to know their stories.  The disadvantage of this strategy is that after leaving I am jotting down every last detail I can remember!

First impressions tells me that the mission of the Adelante Foundation, to improve the standard of living for extremely poor women in rural Honduras, is being met head on through microfinance and small business education.   Loans as little as $50.00 might seem insignificant by the standards of the developed world, but for the extreme poor, microloans make a difference.  Every assembly I visited and every client I met, revealed how their loans have been used in order to boost their businesses and improve their overall standard of living.   My hope over the coming weeks is to continue the process of orienting myself with the remaining offices and departments, where I expect to find the same outcomes of positive change.