And while usually we’d get a little sheepish about claiming to be involved in a “hotbed” of anything, if the Economist calls “finding new ways to fund poor students” a “hotbed of innovation,” then that’s one bed we’re happy to jump right into with both feet.

We’re particularly honored and humbled to be featured in this article alongside visionaries like our partners in Mongolia, XacBank. (See our students from XacBank.)

Former exec of XacBank, Ganhuyag Ch. Hutagt, was quoted as saying “Lending to get a student through college is a far better way to fight poverty than making small-business loans.”

This is music to our ears.

For more information about the opportunity, risks and rewards of lending to students like Betsy, we invite you to read the article in full, and learn why “millions of poor would-be students could benefit” from this new innovation in microfinance.

All of us at Vittana have been fortunate – we all attended college, and have reaped the benefits that come with higher education. We learned from knowledgeable professors, met a diverse and talented group of friends, were pushed and challenged to do more with our skills and received the tools to get great jobs once we graduated.

Yes, we all worked very hard in school – but most of us did not have to work hard to get the opportunity to attend school. Many of us followed in the footsteps of our parents and older siblings – going to college was both expected and encouraged.

This situation isn’t the norm for our Vittana students. They are often the first in their families to dream about getting an advanced degree. There is absolutely no money available to them to pay for their education; there are very few places they can turn to for a loan. Unlike in the U.S.,  there are no Sallie Mae programs, Pell grants or other places to turn to seek out financial assistance.

“Back to school” doesn’t have the same meaning it does for us for our Vittana students. That amazing feeling of opportunity doesn’t happen for them until their loan is funded – and that can’t happen without the support of our very generous lenders.

Today, over 3,000 lenders from 36 countries have helped us loan close to $350,000 to deserving students. These lenders have helped send our students back to school – to become doctors, lawyers, teachers, chefs, computer scientists… the possibilities that come with these opportunities are amazing and inspiring.

To celebrate fall, our students, and the efforts of our lenders, we’re kicking off a back to school promotion. Our goal is to send as many Vittana students as we can “back to school” this fall- and keep paying the opportunity of education forward.

It’s easy to participate – get your friends, colleagues, alumni group, book club or anyone one else  together and form a group on Vittana. Pick your students, make your loan, and keeping checking the back to school page to see what group is in the lead, and how many students are getting loans!

Need some inspiration? Check out Mercy, one of the first students Vittana lenders funded in Peru. We featured Mercy in our August newsletter, as she is really working hard to make the most out of her new opportunity.

Here’s her story:

At age 15, Mercy Marilu, known by friends as a bookworm, planned to attend college and dreamed one day of teaching as a professor. But at 18, she was forced to put her dreams on hold for something far less glamorous — selling roast chicken on a dusty street corner in Huaycan, a province on the eastern outskirts of Lima, Peru. Strapped for cash and struggling to support two other children, Mercy’s parents could no longer financially support their daughter and expected her to immediately contribute to te family income.

Vittana has given Mercy the opportunity to now go back to school to study elementary education and finish her college degree. In addition to her own studies, she has a new dream — to make a private, five-year university a real possibility for her four-year old daughter. This time, Mercy has already put the dream into action — she has opened a savings account in her daughter’s name.

Enjoy the turning of the seasons, and help us celebrate back to school!

First, the BEAN Seattle team held a date auction, with all of the proceeds going towards Vittana loans. This hard-working, highly energetic, passionate group raised over $15k for Vittana students!

We were more than happy to sacrifice Kushal to the cause (Bachelor #5) and really appreciate that our friend Luis stepped up for us as well (Bachelor #2).  Two lucky ladies will definitely have great dates with our guys!

Kushal on the bidding block at the BEAN date auction

If you missed the event, you can check out the juicy details here: http://bit.ly/cJkFKw

Next, last night we held our own Vittana end-of-summer bash… just as the fall weather rolled into Seattle (yes, we planned that). Many of our lenders & friends stopped by our office to catch up, hang out, and listen to Brett, our CTO (who just happens to moonlight as a DJ) spin his music magic throughout the night. Thanks to the Vittana team for putting the party together, our own Doug McManaway for working the social media channels to get the word out, and to everyone who came by and donated!

Finally, we have another round of inspiring students on the site – individuals like Ricardo. In Nicaragua, where Ricardo lives, only 9% of men are able to finish college. That’s a statistic we all need to work hard to change – so come check out our students and kick off your own cycle of opportunity today.

The Fellows program started fairly informally as a way for friends of the Vittana community to help out during their personal travels to our partner countries. Today these “super-volunteers” play a vital role in the Vittana process by performing duties such as:

Adam Lenhardt worked with our partner MFI Fundacion Paraguaya.

• Enhancing the connection between lenders and students with materials such as blog posts, student updates, and videos (Like these ones here and here!)

• Reiterating Vittana’s mission and policies to our partners and answering any lingering questions about them.

• Addressing specific barriers in the loan process and working to improve the efficiency and frequency of loans.

Sounds easy, right? If the Fellow’s tasks seem simple, add in language and cultural barriers, the complicated interworking of an MFI, and the different objectives of bank officials, loan officers, students, and everyone else involved, and a Fellow’s job suddenly seems overwhelming. Nevertheless, our Fellows are known to go above and beyond their outlined tasks to improve our partnerships. In the past they have worked on everything from preparing material for our partners’ websites to training loan officers on what to look for in a potential Vittana student. Here at Vittana, we call our Fellows “scrappy” for their ability to get things done with little assistance, resources, or prior experience.

Our four former Fellows—Katie Gruver, Nayna Gupta, Adam Lenhardt, and Jordan Webster—come from backgrounds as varied as the challenges they faced abroad. Collectively, their interests include education, finance, music, law, development, and much more. Most of them had little formal experience in microfinance prior to setting off for their destinations, but they were all inspired by the possibilities it presented and were eager to learn more.

Nayna Gupta got a chance to explore Peru during her time as a Fellow.

There is clearly no set recipe of experiences that qualify someone to be a Vittana Fellow, but there are definitely certain qualities that all our Fellows share. According to Nick, Vittana’s International Partnerships Manager, our Fellows are all “smart, motivated, independent thinkers who approach challenging problems with a solutions mindset.” They all have a high degree of resourcefulness, flexibility, and persistence, and a remarkable ability to self-initiate. Most important though, is their innate desire to make a difference and their strong commitment to furthering the Vittana mission.

After all, it takes some pretty strong motivation for someone to postpone a comfortable life in the U.S. and work unpaid for a few months in a foreign country. Our Fellows are driven to do this by a variety of factors. As Jordan puts it, it’s the desire to “travel with a purpose.” Others see it as an opportunity to improve their language skills or kick-start a new career in microfinance.  But all of our former Fellows speak of the sense of accomplishment they feel knowing that more students are going to college because of the work they have done.

Whatever their motivations, the Vittana Fellows are essential to the success of our partnerships and overall mission. To all our Fellows—past, present, and future—we applaud you and thank you for your tremendous contribution and commitment to the Vittana cause.

Think you might have a future as a Vittana Fellow? You can learn more about the program on our website at http://www.vittana.org/getinvolved. While our ability to take on Fellows is largely dependent on the needs of our partners, Vittana is always open to applications from qualified, driven college graduates who want to spend 2-4 months volunteering with a a Vittna partner MFI.  We currently have a specific need for applicants with Vietnamese or Mongolian language proficiency.

This week, we funded 5 students. We’re adding more students to the site over the next few days, so we hope to fund even more through the end of August.

On Tuesday, we were inspired by a visit from President Obama literally right next door to our office! When we all arrived to work that morning,  we saw crowds gathering and there was a buzz of excitement going. Read Lindsey’s great blog post for more about this adventurous day for us.

We want to close out this week by sharing one of our absolute favorite photos…pictured below is Nardith, one of first students from Peru that our lenders were able to fund. She, and her little brother Stephen, have experienced the transformative change that microfinance can enable. (Stephen is one happy, mischievous little boy, and our favorite!!)

Over four years ago, after finishing high school, Nardith was attending college. However, she got pregnant and, between working full-time, going to school full-time, and taking care of her newborn son, it was just too much for this single mom to juggle. However, Nardith’s mother, Angela, had received a microloan from EDAPROSPO in the past, and used those funds to successfully start a taxi business. Angela transformed from a struggling single mom, to one with a strong source of income.

Nardith was inspired by this, and thought that perhaps EDAPROSPO could help her too…

Fast-forward four years. Nardith is currently going to school full time (4 hours of class in the morning, 3 hours of class at night) and working full time selling paintings at a tourist shop during the afternoon in between classes. Her grades are good and she likes her professors. She’s excited about school even though her studies are quite challenging.

She has also started to pay back her loan – and her family is just as excited, and pleased with her progress as Nardith is.

Remember, you can generate some good karma by lending to a student today!

Nardith and Stephen. We hope to fund Stephen's education down the road, as well!

Distractions aside, he came to one of our hangouts, Grand Central Bakery, to meet with several local small businesses owners. Current Commerce Secretary (and former WA governor) Gary Locke was along for the ride as well.

Once we heard the president was coming to visit, we knew we had to try to see him. It’s his first visit back to Seattle since before he was elected, and it’s not every day you’re within 50 feet of a head of state (and our own, no less). Plus, we wanted to try to get a picture of him with a Vittana t-shirt on. C’mon, it could happen!

President Obama looking fine in a Vittana t-shirt

Alas, it was not to be. The Secret Service kept him under pretty tight lock and key, even going so far as to take him in a side entrance so all we could see was his motorcade:

The motorcade started just outside our window.

Despite our complete failure to catch the President while he was in town, I hear he made a good impression on the staff at Grand Central and it’s good to know that we’re playing our part in the daily actions that keep our republic alive. He’s been making major changes to the way student loans are run in the United States, and it will be interesting to see how those changes play out and how they will echo or differ from the way we at Vittana build student loan programs in other countries. It’s always exciting to be a part of democracy in action – reminds us of how much we have to be thankful for.

If you like President Obama (or if you don’t!), don’t forget to support your local non-profit small business and make a loan today.

I’m on my way back from Granada on what’s called a “microbus”, a term that refers to the size of the bus rather than the number of passengers.   I am sitting in a very small seat which I’m sharing with my 3 new best friends. There is music blasting from the bus radio.  Women push their way through the aisle singing their food for sale—“viga-viga-viga-vigaron!”  It’s pouring rain, the windows are foggy, and I am deep in discussion with my seatmates about microfinance in Nicaragua.

It seems that no matter where I go in Nicaragua, I inevitably find myself talking about microfinance with the people I meet.  While I always want to talk about how cool Vittana is (which I do!), I find that their concerns about microfinance merit a discussion.  This is especially true given Nicaragua’s unique—and sometimes stormy—history with microfinance.  The topic is quite large and complex.   I’m not an expert by any means.  Yet I hope my observations gathered by being on the ground in Nicaragua over the past 6 weeks might offer another perspective in the larger conversation about microfinance and how it relates to Vittana.

One of the largest issues facing microfinance in Nicaragua is the Movimiento No Pago (Non-Payment Movement), consisting largely of farmers from north and central Nicaragua who are refusing to pay back their loans.  The No Pago Movement initially gained significant ground from politics.  In July of 2009, President Daniel Ortega told borrowers “instead of protesting in the streets, protest in front of the usurers (microfinance institutions or MFIs).  Stand strong, we will support you.”  Compounding the political climate, Nicaragua’s culture of finance is still in beginning stages.  In a country where corruption is common and politicians use debt for political clout, well-meaning loans made by well-intentioned MFIs may be lost in translation, so to speak.

No Pago Movement members protesting in the fall of 2009, (LA PRENSA/L.E. Martínez M.)

Certainly there are important questions to ask as microfinance continues to develop.  In the beginning, some borrower pushback could have served to keep MFIs in check.  There are some international questions about abusively-high interest rates and the introduction of big banks (seeking big profits) into the traditionally social good-oriented world of microfinance.  There is an ongoing debate about how to make microfinance sustainable and still serve the poorest of the poor.  Additionally, Nicaragua was hit particularly hard by the global economic crisis, thereby exacerbating an already bad economic situation.  Given all these factors, there are most likely farmers who have been taken advantage of in microfinance.  As the number of borrowers in the No Pago movement grows and only a tiny percent choose to renegotiate the terms of their loans given the opportunity, it also appears that many borrowers are now taking advantage of microfinance.

Regardless of motivation, members of No Pago Movement harassed microfinance loan officers, burnt down MFI buildings and blockaded streets.  In response, credit lending institutions began pulling out of Nicaragua, causing potential havoc in certain agricultural communities which relied heavily on foreign investment.  According to EIU ViewsWire “arrears on loans caused by this group [No Pago Movement] have become a serious problem and threaten to imperil the sector’s future.”  Recognizing the potentially disastrous effects this could have on the stability of the Nicaraguan economy, Ortega changed his previous position.  The National Assembly stepped in and passed the “Ley Moratoria” (Law of Moratorium) in April, granting delinquent borrowers 120 days in which to renegotiate the terms of their loans.  This has served to calm the No Pago Movement, but could have significant long-term consequences regarding access to credit and an MFIs’ ability to operate in Nicaragua.  The 120 days marker has just passed and most recently, the No Pago Movement has been circulating talk about a government bailout.  This is a critical episode in the fate of microfinance in Nicaragua, and it will be interesting to see what happens next.

AFODENIC staff discuss interest rates at a recent meeting.

The work of making educational loans available to Nicaraguans continues.  It is a full-cycle affair, requiring the hard work and cooperation of lender and lendee alike.  Like all forms of credit, it is the responsibility of both parties to ensure the loan conditions are fair and paid off.  MFIs must educate their borrowers and ensure that the services they offer are both fair and understood.  Borrowers have a responsibility to understand the terms of the loan and not enter into an impossible contract.  In the end, it will be a well-established history of good lending practice, like that of AFODENIC, good borrowing practice, and support by organizations like Vittana that will enable microfinance to pull many more Nicaraguans out of poverty.

If you would like to support a Nicaraguan student, click here.

If you would like to read more about the No Pago Movement, here are some possible resources in English and Spanish.

Why? At Vittana, we look forward to Fridays because we get to look back at the week, and see how many students and lenders we’ve been able to connect, and that’s when the good karma reaches a high point. So, every Friday from here on out at Vittana is officially good karma Friday.

This week, because of our amazing lenders, we were able to fund 10 more students.

There is a Peruvian proverb – “little by little, one walks far” – that really resonated with us this week. Each week, more students appear on Vittana, and each week, lenders find a student, fund them, and new opportunities are born. 10 more hard working, deserving individuals now have the opportunity to finish their education. That’s the kind of karma that works. That’s the kind we want to keep delivering.

We know it works, because our students are working hard to make the most out of the new opportunities they’ve been given. We love it when we get updates from our students – their stories, where we learn more about them and the incredible progress they are making.  This makes us smile, gets us excited, and builds hope. Step by step, loan by loan, we are all making a difference.

To help celebrate Friday, we pulled out a great update from one of our students – Scarlett, who is really working to make the most of her opportunities. Hard work and hope keep her going.  As our friend Katie says, ” It’s hope that keeps you human.” Scarlett is an example of what happens when you throw opportunity into the mix, as well.

Scarlett Constansa Aguirre Ramos

Scarlett is an incredible Vittana student. She lives in Nicaragua, already has a degree in medicine and has been practicing for about 10 years. Scarlett believes strongly in serving those who have less. She travels a few times a week to smaller towns to visit her poorer patients who cannot come to her.

Scarlett's plans post-graduation include a free walk-in clinic for poorer patients.

Given that many can only pay for the visit OR a prescription, Scarlett often visits her patients for free, offering needed care and health education classes as well.

When she completes her specialization in pharmacy with her Vittana loan, she will not have to pay an outside pharmacist to handle formulating her  prescriptions, and will better be able to serve her patients by providing all the services they need – even if they are unable to pay for them.

In her “spare” time, Scarlett is also taking English classes and spends time with her two daughters.

That’s amazing! A working mom, who already goes out of her way to take care of others, now seeks even more opportunities to use education to not only help herself, but others in her community as well. That’s inspiring, and we want to thank Scarlett’s lenders who helped pay it forward to make this happen.

Inspired? Read more about Scarlett here, or find a student like her to lend to here.

Cheers! -Lisa

So, here’s our take on how Vittana thinks about some of these important elements the article cites.

What every start up needs:

1. Sunny office, where you can open windows. We currently reside in a former dance club and bar in downtown Seattle’s historic Pioneer Square (that photo up top is us). Lots of big windows. Unfortunately, we can’t open them. Then again, given our location, some days that’s probably a good thing…

Occidental Park is right outside!

2. Make sure the office is near a park and public transportation. Our office sits right on Occidental Park in Pioneer Square. Head out of any of our exit doors, and you’re there. There’s no grass, but sure, it’s a park, and on the first Thursday of every month there’s a free Art Walk as a bonus. And, for the public transportation-loving employees, the bus tunnel is only 2 blocks away (sweet). On any one day, you can find Vittana employees taking the bus, driving, skateboarding, biking, or running into work. We thrive on variety.

ooga

3. Lots of in-person interaction. This is definitely something we have. We work in a shared space (see that header image again), which gives us lots of opportunity for shared conversation, easy answers to questions, and the occasional funny YouTube clip.

Vittana's very high-tech wireless setup

4. You need two forms of Internet access. Well… after borrowing Internet from friends and the City of Seattle (totally legal, we promise – Seattle public wifi, we love you), we finally got our own up and running. >>>

What every start up doesn’t need:

Vittana's scrappy office furniture (notice the mouse is missing a cover plate)

1. Fancy chairs are just a waste of money. Ha! We could not agree more. No fancy chairs, lights, desks for us. We are definitely consumers of Ikea thrift.

2. Don’t hire a PR firm, just be your own PR. At Vittana, we haven’t hired a PR firm, because outstanding people have helped us out by generously offering their time and support, for which we are eternally grateful. And the “awesome product” part of Vittana is our students and the lenders who support them  – it’s a great cycle of paying it forward that does truly help us close the last mile of education.

3. Central air conditioning Well, actually we’ve got this one covered. Our sweet bar/nightclub has automatic A/C that comes on every night at 10 pm sharp, but no controls to speak of. It would be great if we were a dance club, but since we haven’t yet made that strategic move, sometimes we wish we could turn it off!

Nick hard at work using his cell phone instead of an expensive central phone system.

4. You don’t need to plow money into a phone system. Done. We’re cell phone users + Skypers (and yes, Nick – we agree that sustainable development is sexy).

5. A vacation policy, a set time to arrive in the morning and a dress code are a waste of time. We could not agree more! When asked about those things, Kushal…well, let’s just say it was one of those rare occasions when he was momentarily speechless. Why? We trust each other; we work hard, we play hard (and we’re really good at picking the locks for the shackles that keep us chained to our desks).

We hope you liked getting a glimpse of our office, and our approach to startup life.  We feel strongly about plowing every ounce of time and effort we can squeeze into our mission. For everything else, we’re scrappy to the core!

We’ve already received updates for many of our students, and each update is published the student’s page as we receive it. In the coming weeks, we’ll be unveiling this program in a much bigger way, but we wanted to get the word out now.

To see if your students have updated us with news about how they are doing,  visit your portfolio page on the site, login, and scroll through the list of students you have lent to. Click through to different student’s pages to see if there are any new updates. You can also click on the link in the email we sent you about this — we promise this early preview of their stories is worth the effort!

Soon, these updates will become even easier to find. However, we all need an inspirational pick-me up once in awhile – so we wanted to share this new feature now.

Every story is a good one – but we wanted to share with you two amazing stories of promise and human potential we particularly loved.

First, an update on Isidro:

Isidro appeared on Vittana.org on Christmas Eve last year.He’s 33 years old and he’s been practicing dentistry since he was 13. That’s not a typo: in the turbulent days of the Nicaraguan revolution, anyone could practice medicine — because Isidro’s father was a dentist, Isidro started helping at an early age.Nonetheless, Isidro had always dreamed of finishing school and becoming a real, full-fledged dentist. Over the last 10 years, using money he saved from working and through the generosity of two American expats, he took whatever classes he could find and slowly worked towards his graduation.In January, five people from Los Angeles, Chicago and other cities made a loan to Isidro. Last month, he was finally able to graduate. Today, Isidro wanted us to tell you that he’s now an official, certified dentist. He’s already made 4 repayments on his loan!

Next, news from Thao:

When we first met her, Thao wanted to be a music teacher. She just loved kids and loved music, and what better way to combine the two?

After getting loans ranging everything from $22 to $200 and everywhere from Seattle to New York to Hungary, she was able to begin finishing her studies at the Hanoi College of Art. Now, five months later, she’s nearing her graduation. Like any young man or woman, she’s a little nervous about what that really means but is excited to be living her dream of becoming a teacher.

An excerpt, in her own words (you can see her full update on her page here):

“I am preparing to graduate from the Hanoi College of Art with a teaching degree in music instruction and music theory. Of course I am nervous because details of my appointment are still unclear, such as which school and program, but I am certain I will be living my dream. Currently, I am focused on continuing to cultivate my knowledge and expertise. To do this, outside of my courses I particiate in musical performances for small audiences and assist with adult music classes to develop my ability to help individuals overcome difficulties in the learning process.”

We’re getting more updates from Vittana students regularly. Despite all the challenges and big, unsolvable problems we hear about in the news every day, there are incredible stories of hope and human potential. These young men and women already have that amazing potential, but it’s really you who’s enabling them to achieve it. For someone like Thao who originally needed just $557 to finish school, a $25 or $50 loan can really make a big difference.

To our current, past and future lenders, we want to say thank you for all that you do — and that comes not just from the Vittana team, but now also from the Vittana students themselves.

Finally, we want to recognize our hard-working Vittana fellows – Jordan and Adam – for working so hard to interview students in their respective countries. Their efforts are tireless, and we look forward to their update emails. Sharing student news would not be possible without them!

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