“Rainy season” in the Philippines is no joke. For about seven months a year, the Philippines is riddled with perpetual downpours and frequent typhoons.

The flooded street outside my home in Cabanatuan

Since I have been in the Philippines there have been nearly twenty typhoons, most of them consisting of very heavy rains and mild flooding. My street is especially prone to floods – it is a commonplace for me to wade at least ankle deep to cross the street.  Thus, living in the Philippines makes you quite accustomed to the type of weather that would be newsworthy in the United States. Usually, impending typhoons are rarely even talked about in the Philippines.  It’s like this: “Hey did you hear another typhoon is coming through?” “(Apathetically) Oh yeah, I heard…” and then people go on with their lives as if nothing is different.

However, the last few days of September marked an exception to this rule. On September 27th, 2011, Typhoon Pedring (or Nesat by its international name) swept across the island of Luzon, devastating nearly 3 million people. Just three days later, before affected residents could recover, Typhoon Quiel (Nalgae, internationally), battered the same locations.

The ASKI "Help" van being loaded up with supplies

Due to intense flooding and winds, an estimated sixty people were killed by the typhoons and hundreds of thousands were displaced. In Cabanatuan, where I live, the streets were waist deep in water and we were without electricity or running water for nearly 40 hours. In the surrounding towns and provinces, many people remained trapped on the roof of their house for days. Typhoon Pedring, the larger of the two, caused an estimated $200 million in damage to agriculture and infrastructure (with agriculture bearing the majority of the cost), rendering it one of the costliest typhoons in Philippine history. (Click here for a breakdown of the damages inflicted by Typhoon Pedring and here for Typhoon Quiel.)

Over 12,000 ASKI clients were affected by the flood, in turn distressing ASKI’s outstanding loan portfolio to the tune of 192 million pesos (about $450,000). Largely dependent on agriculture, ASKI clients were some of the hardest hit.

Community members line up to receive their relief supplies

ASKI was quick to respond, by linking with donors to restructure loans or to provide provisional funds to accommodate affected clients. In addition, ASKI heightened its fundraising activities to aid in typhoon relief efforts. As part of these efforts, ASKI staff travelled around to affected areas (those whose flooding had subsided enough to get to) distributing staple food items and water. I was fortunate enough to tag along on one of these expeditions.Through a conversation with ASKI staff, I learned that these relief efforts were not exclusive and aimed to help entire communities – not just ASKI cients. On the drive to the community, we passed many people wading through waist deep water just outside their homes; a week after the storm, many people were still waiting for their neighborhoods to dry up. When we arrived at the community, nearly 450 people were lined up to receive emergency supplies from ASKI. We also had a nurse on hand to provide medical assistance where needed.

A little girl, hands filled with relief supplies, happily walks towards her mother

An ASKI employee pulled aside a woman who had just received her emergency package and asked her to say something about ASKI’s relief efforts. The woman could only get out “Thank you so so much” (in Tagalog) before her face became flooded with tears of gratitude.

This typhoon relief effort is just one of the many ways in which ASKI stands out above other microfinance institutions. In fact, ASKI was awarded the Most Outstanding Non-Government Organization (NGO) during the 6th Annual SIPAG Awards sponsored by the National Livelihood Development Corporation (NLDC)

I am proud to be a part of such a philanthropic organization!

College is a critical junction in the transition from child to adult. It’s a time when students learn to manage their own budgets and begin to understand what “cost of living” is all about. In Ghana, few students work during the school year. The job market is competitive, and much of the labor market remains informal. As a result, parents scrimp and save to get their kids through school. Sometimes, it’s just not possible to pull the fees together according to the timeline a school puts in place. But just like anywhere else, parents here feel invested in their child’s education – wanting to ensure their kids maximize opportunities by attending the best schools possible.

Recently, Stephanie and I held a focus group with a group of business clients from one of our Ghanaian partners, Opportunity International. Leaving the confines of our modern office we walked a short way to a local church where about 25 people had gathered. As we began to discuss the possibility of how Vittana might work for this community, the church began to fill with traders from throughout the community. Over the next two hours we heard over and over about the dreams these parents had for their children – visions of future doctors and politicians, lawyers and accountants. After a question that drew a number of responses, our translator turned to us and said simply, “None of them want their children to do what they do.”

During the meeting

How many parents have felt this sentiment – this almost palpable desire that one’s offspring should benefit from the blood, sweat and tears of the only work they had the option to do? That the backbreaking mornings and nights of carrying goods sold for pennies will be worth it if their offspring can get the education they didn’t have access to?  We know from many stories (and research) that microfinance has helped countless people move beyond earning just enough to get through the day. Standing in front of these microfinance participants and seeing how quickly they understood its potential for their children was an incredible testament to this model. These are people whose livelihoods continue to grow because they’ve been offered affordable credit and capital to build upon. How might their children use the same tools in their education? The opportunities feel almost endless.

As we move forward in our planning to create student loans in Ghana, I will keep the faces of these parents firmly in my mind. Each student we serve holds the potential to make their family proud by taking advantage of their education – whatever they choose to study. It’s easy to see how these students will eventually reinvest their incomes into the education of other family members and children – continuing the cycle of opportunity so often rooted first and foremost in gaining access to higher education.

I am stationed at an ideal place to measure the impact of Vittana loans on students and their families. AFODENIC in Nicaragua is one of Vittana’s most established partners, having worked together since 2009. More than 100 students have graduated college because of Vittana loans through AFODENIC. I’ll tell you more about that impact in a later post. For now, let me tell you about some of the interesting changes our partner is bringing to Nicaragua beyond their groundbreaking work with student loans.

Student loan promoter Marjorie Gonzalez talks with students at the University of Commercial Sciences in Managua.

AFODENIC has an interesting, although long, name that translates as the Association for Fomenting the Development of Nicaragua. “Foment” isn’t a word we use much, except for describing a revolution maybe. But I kind of like the word, and maybe we are actually fomenting a revolution of sorts – a revolution of education and opportunity. Yet somehow I don’t think that’s what all the graffiti around town reading “¡Viva la Revolución!” is referring to.

Although AFODENIC currently actively serves about 250 Vittana students, this still makes up a small portion of their total number of clients. All in all, they have about 5,000 active borrowers. The scope of AFODENIC transcends traditional microcredit into community development projects such as solar panels, water purification systems and affordable housing. In fact, about half of their $8,000,000 portfolio is dedicated to building or homes in low income neighborhoods.

Lawyer Ileana Vega explains the legal aspects of the loan before disbursing loans to clients.

This year, AFODENIC expanded their services further by offering insurance policies to people who wouldn’t otherwise have access. If a member of a family dies, it’s an emotional blow that may also spell financial ruin for a family. Insurance can help soften that blow.

All of these services fit under the umbrella of providing access to financial services for a majority of the population who wouldn’t otherwise have that access.

Clients make payments on their loans.

This extensive approach started with a project from a Spanish NGO, Peace and the Third World, working those in need outside the city of Juigalpa. This initial project resulted in a microcredit initiative for farmers, which led to the founding of AFODENIC in 1999.

The current director, Francisco Montoya, was one of the founders. He’s a warm man, with an air of quiet competence that completely breaks down when asked about financial services for the underserved. He explains that although much of AFODENIC’s work is now in the capital city of Managua, where I’m currently based, there is still a strong emphasis on support for farmers and rural citizens. Montoya explains that this work is important not only because there are so many struggling farmers in Nicaragua that lack basic access to financial services, but also for the simple reason that much of Nicaragua’s food comes from these small farms. If farmers have credit to buy high yield seeds and fertilizer or other more productive practices, they can produce more plentiful crops at a lower cost per unit. This translates to better incomes for farmers and affordable, fresh food, benefiting all of Nicaragua’s consumers.

Employees Gonzalez and Leonarda Hildalgo leave the office after a day of work.

Out of this broad slate of projects, education plays an integral part in Montoya’s and AFODENIC’s vision for the future.

“Our vision is to be an instrument, a platform for funding the projects that will develop Nicaragua,” he says, “Education is part of that.”

For one, a lack of education limits personal potential. But as part of a vision for a better Nicaragua, the lack of access to education means something broader to Montoya. Limited access to education means a limit on the potential of the country as a whole. Together Vittana and AFODENIC are fomenting a revolution to make that access limitless.

¡Viva la Revolución! indeed.

At seven in the morning when I set out for FINCA Peru the streets are already overtaken. People dance around each other as they pass on the sidewalks, trying not to step into the street for fear of the taxis and tuk tuks. The tuk tuks which are a cross between a very small car and a motor bike own the streets of Ayacucho. On the mornings that I choose to take the route that leads me through the market, all my senses are alight. Every usable space is inhabited by vendors. The storefronts are packed with clothing, shoes, beds, ovens, refrigerators, produce, meats and so much more. On the sidewalks women sit in traditional Quechua dress their blanket splayed with fresh herbs, garlic, and other goods available for purchase. On the streets men have set up shop ready to make you a key or personally type a letter for you.

My morning walk is usually about 30 minutes. When I approach FINCA Peru its big green gate and coral colored walls provide me with the feeling that I am about to enter a fortress. When I enter I am greeted by a sunny court yard. Since its founding two decades ago, FINCA Peru has expanded; it now operates in Lima, Ayacucho, and the rural areas of Wari and Huancavelica. The Ayacucho office is full of activity. In a normal week each of the 300 community banking groups will meet to repay loans, approve new loans, and participate in classes to help the socias grow their businesses. The Ayacucho branch office is the epicenter of all this activity with over 6,000 active clients.

FINCA Peru does much more than just provide financial services, they have a mission to empower women and provide business education and support services for the families they serve.

Each of the community banking groups (a small cooperative of clients) meet together with their loan officer for an hour each week — half of this time is dedicated to education. A broad spectrum of topics are covered from savings and business growth to marketing. In Peru around 40% of Peruvians live on less than $2 a day, and a disproportionate percentage of those live in the rural areas. Access to capital as well as access to information about how to better use the money they make is crucial in the lives of those that FINCA Peru serves.

FINCA Peru’s devotion to the families of their clients is also reflected in its Aflatoun project. Aflatoun is a project designed for the children of its clients. It is a weekly community bank for kids ages 6 to 12. In Aflatoun the children choose a president, vice president, and a treasurer. Each week they deposit money into their personal savings accounts provided by FINCA, and learn lessons in planning for the future, and entrepreneurship. Now that FINCA Peru is also working with Vittana to develop a student loan product for young adults, I am excited to know that these children are being encourage right now to dream big with the knowledge that they’ll have the financial support to help bring their dreams to fruition.

I believe the current foundation of education built into FINCA Peru’s mission has created an environment perfect for expanding into student loans which will be offered to the clients of FINCA Peru and their families. Over the past month, I’ve focused on developing surveys and interviewing focus groups, to more clearly understand the needs of the students of Ayacucho.

To conduct surveys, a FINCA Peru employee and I would go to each community bank meeting. We would usually begin by explaining that FINCA Peru had partnered with Vittana to create a new loan for students. We provided examples of what these loans could be used for. I would notice around the room the women would start shaking their heads in approval. I could tell that this was something that many were excited about.

After our explanation of the Vittana student loan product, we’d conduct an informal Q & A session. Our discussions gave me a much clearer view of how this loan product might be used. One woman told me that her children were still too young for a Vittana loan (our student loans are structured to help people in the final stages of their education — college, technical school or certificate/training programs after high school that will allow young people to get good paying jobs). However, she proceeded to elbow her neighbor, who then shyly announced that she had finished her own studies, but had been unable to afford final exam expenses, therefore she had never gotten her diploma which would have allowed her a better paying job. This is one of the problems that Vittana student loans will solve.

One experience with a woman really touched me. As I went down the list of survey questions with the woman, she began telling me little bits and pieces about herself — how she had studied nursing when she was younger, but had been unable to finish. She was in her late thirties, and kept asking me if I thought she was to old to go back to school. I answered with a definitive “no,” I could see in her eyes a discarded dream being re-sparked.

The excitement of possibilities is amazing to observe and be a part of. Albert Einstein said it best: “All that is valuable in human society depends upon the opportunity for development accorded the individual.”

For the past two weeks, I have been criss-crossing the Philippines with Sanjaya Punyasena, one of Vittana’s International Partnerships Managers, and Roger Johnson, our Chief Financial Advisor. We have spent 2-3 days with each of our three Filipino partners, meeting staff and students at each step along the way.

Why are we doing this?

Other than the obvious answer that we wanted to get some extra vitamin D (we’re starved for it in Seattle), over the course of the past six months or so, our Partnerships Team has been hard at work building new partnerships to increase the number of students we reach. Many of our new microfinance institution (MFI) partners are just a few steps away from finalizing their student loan product and offering it to students. As we get close to disbursing the first student loans with these new partners, we lead market research studies, focus groups with students and training workshops with the MFI team in order to make sure that these pilot launches go off with out a hitch.

In plainer terms – we’ll have more students on our site, and soon. This trip was to make sure our MFI partners (and their students) are set up for success.

To be clear, I’m not usually a part of this process. Trips like these are run-of-the-mill for Sanjaya, but not for me – I typically talk to our lenders and help run the shop at home. As such, this trip is the first chance I’ve had to really see microfinance in action. And let me tell you, it’s amazing.

Here are three things I learned during my trip to the Philippines:

Sanjaya and Roger discussing student loan specifics with staff of our current partner, NWTF.

1) For one thing, the people are committed. A few questions about microfinance have recently been raised in academic circles. While those questions should be asked and answered, let there be no doubt that the people putting together the Vittana student loan product have only the students’ best interest at heart.

Our MFI partners surveyed their communities in advance to see what the students were interested in studying, what size loan they could realistically afford, and whether they’d even be interested in taking out a loan. From there, we worked with them to nail down the nitty-gritty, essential details. (How long does each student have to repay? What will the interest rate be? How are we confirming that they’re going to good schools?)

The final answers to all these questions look a little different at each partner, as the needs of their clients are correspondingly different. But one thing is the same – we are confident that each new student loan product is one that will be useful for students, affordable for them and their families, and sustainable for the MFI. Our MFI partners view this new loan product as a needed service for their clients, and students are thrilled at the chance to afford an education. It’s a win-win on all sides.

The dean of a local hospitality school shows us around the working kitchen her students use in the course of their classes.

2) Their reach is vast. Our Filipino MFI partners are proud of their holistic approach to client services. Whereas a traditional MFIs focus solely on micro-business loans, our partners in the Philippines offer other services (often referred to as “credit plus” services) like classes on good business practices or mentoring to new business owners.

Our partners’ approach to their new student loan products are no exception. I’ve been so impressed that even though each partner has tens of thousands of clients, the MFIs that we’ve met with view all their clients (students included) as individuals whom they are responsible for shepherding through the process . Our MFI partners want these students to be as successful as possible and are really walking their talk.

For example, One partner has plans to offer resume workshops after graduation, and assistance in finding jobs. Another is building relationships with local companies to introduce their students to the business world, and potentially jobs. All will regularly check in to see how each student is faring in class, and if they need any help.

Five of Vittana's current Filipino students.

3) The thirst for education is great. “Clients are already waiting for this program.” “When can we start?” Over and over throughout the trip, we heard from the MFI’s staff, their clients and then the students themselves that they were excited about being able to get a student loan. At one partner, the entire focus group interviewed (165 out of 165 people) said that if given the choice, they would like to take out an educational loan. There’s consensus for you. And when we had a chance to interview a few of our current students (pictured left), when asked if it was worth it to take out a student oan, every single one said “Yes.”

That said, the Philippine government previously attempted a loan program called “Study Now, Pay Later” that wasn’t particularly successful. For that reason, we have proceeded carefully throughout the product-building process, and are excited about what we’ve come up with. In short, you should be seeing a lot of Filipino students on Vittana’s website in the near future.

Sanjaya, Roger and I with the general manager, chairwoman of the board, and a branch manager of PMPC, one of our new partners.

Unfortunately, our trip in the Philippines is drawing to a close, and we will soon be back in the States. It has been incredible to see our partners in action, and get a glimpse into the realities of daily life for each of our students. It’s energizing just to watch these innovative new programs being built. But for me, it’s now time to kick back into gear in my corner of the world.

Until the next update, though, keep an eye out on the site for new Filipino students (or go lend to another worthy student in the meantime!).

Today is a big day here at Vittana: we are thrilled to welcome Negros Women for Tomorrow Foundation (NWTF) as our eighth student lending partner and our first partner in the Philippines!  NWTF, headquartered in Bacolod City on the western side of Negros Island, serves over 80,000 low-income entrepreneurs, 99% of them women, in the Philippines’ Visayas region.  In addition to being a highly respected microfinance institution with a dynamic leader—founder and CEO Dr. Cecilia del Castillo received an Ernst & Young Entrepreneur of the Year Award in 2007—NWTF has long been a believer in the power of higher education to alleviate poverty.

In 2004, NWTF launched a scholarship program to help its clients’ children pursue bachelor’s degrees; 75 high-achieving young people have benefited from the program to date.  In Western Visayas, where only 6% of the population has completed college, every graduate counts, but the leaders at NWTF knew they needed to do more.  Client after client told NWTF that their children’s education was their biggest expense; they also consistently said it was their number one priority, even if it meant falling behind on their repayments to NWTF, an obligation no client takes lightly.  When Vittana contacted NWTF about developing a student loan program, NWTF couldn’t wait to get started.

After six months of program development, we’re proud to introduce you to our first seven students: Gilbert, Roland, Stephen, Rene, Jeffrey, Gabby, and Eduardo.  All seven are attending a course to become certified welders, which as Gabby says in his profile, will double or triple their earning power.  Certification in welding and other related fields often leads to employment on construction projects abroad, but all of our students have expressed a strong desire to find local work or start a small business.  Once they start earning money, many of the students say they plan to help their younger siblings attend school.

To be accepted into the NWTF-Vittana program, each student had to receive a recommendation from NWTF clients in his community.  The clients recommended students who were known for helping out at their parents’ small businesses; most importantly, each student comes from a family where no one else was able to attend college.  When I asked NWTF’s program director Raymond Serios about how local young people responded when they heard about the opportunity to receive a student loan, he told me “they were so interested in taking these courses that some students who were already working in far-away cities like Manila chose to come home because they did not want to pass up an opportunity to improve their education.”

I hope you’ll join me in welcoming these outstanding young people to Vittana.  Click here to see their profiles, and please make a loan to help them pursue their dreams!

Click the NWTF logo to listen to the Project Dungganon's theme song

Serving students isn’t the only way that NWTF likes to show its innovative spirit:  it’s also written and recorded its own theme song!  Have a listen by clicking on the NWTF logo above.

]]> http://blog.vittana.org/vittana/changing-lives-in-western-visayas/feed 0 http://blog.vittana.org/vittana/%c2%a1bienvenidos-a-honduras http://blog.vittana.org/vittana/%c2%a1bienvenidos-a-honduras#comments Wed, 13 Oct 2010 15:21:09 +0000 Nick Cain http://blog.vittana.org/?p=1624

Vittana community, meet Fundación CREHO, the newest microfinance institution to join Vittana’s network of innovative student lenders.

It’s always an exciting day here at the office when we welcome students from a new country to the Vittana family, and we’re particularly excited to partner with Fundación CREHO.  Driven by the belief that education is critical to economic development, CREHO’s founding partners (98 civic leaders, business people, and Rotarians who provided seed capital to get CREHO off the ground) recognized that promising young Hondurans were falling through the cracks—a lack of financial resources was leaving them unable to attend technical school or college, with no local banks or microfinance institutions willing to offer them credit without proof that students would repay their loans.  Needless to say, when Vittana was introduced to CREHO’s mission, we knew we’d found a kindred spirit.

CREHO’s hardworking staff of four, which is dedicated entirely to student lending, leverages partnerships with banks and universities to help it maximize impact.  The result is over 170 student loans disbursed since 2006—impressive success for such a small institution.

Arriving at the home of CREHO client Dulce Maria Maradiaga Zapata, while her daughter says hello to the camera.

Dulce Maria Maradiaga Zapata is one of those 170 students.  During an August visit to Tegucigalpa, Dulce welcomed me, CREHO Executive Director Mayte Portillo, and Credit Officer Wendy Varela into her home in the village of El Pilliguín, a 30 minute drive into the hills outside Tegucigalpa.  Dulce met us on the main road into her neighborhood; the final quarter mile to her house was impassable by car, so we took it on foot.  We settled in at the living room table while Dulce’s daughter played in the yard (see exceedingly cute child in above photo), and Dulce began to tell me about her pursuit of a nursing degree.  Every Saturday and Sunday, she travels an hour and half each direction to school, waking at 5am to catch the one public bus that leaves her hillside in the morning, and catching the only one that comes back the other way at night.  It’s been a long road, Dulce says, but with the help of a loan from CREHO, she will finish her nursing practicum and receive her certification next year.  The big payoff, a good paying job to support her two daughters, is already waiting for her when she’s done.

Sitting with CREHO loan officer Wendy Varela (on right) and nursing student Dulce Maria Maradiaga Zapata.

The next day at CREHO’s office downtown, I met another bright, dedicated young mother named Xiomara F.  After graduating from high school, Xiomara took a job at a t-shirt factory about two hours away from Tegucigalpa.  She worked from 7am – 4pm, 6 days a week, and if she “worked really hard and really fast” she earned about $50/week.

When the factory closed three years later, Xiomara decided to look into going back to school.  She had always been interested in the environment, and knew that a couple Honduran universities offered degree programs in forestry.  Based on her strong performance in high school and good recommendations from past teachers, Xiomara qualified for a three-year scholarship to obtain an associates degree in forestry.  When those three years were up, Xiomara had done so well in her classes that leaving without a full bachelors degree wasn’t an option.  The only problem?  She didn’t have the money to pay for a 4th year of school.

Xiomara’s school referred her to Fundación CREHO, who immediately saw what was also so apparent to me: this was a woman with tremendous potential.  One year later, on the evening of her graduation, Xiomara received a job offer.  Today, Xiomara works for a government agency regulating timber companies.  She now earns about $860/month, more than 400% of what she earned at the factory.

Since graduating, she’s gotten married, had a baby, and she and her husband own their own home.  Her husband, who also works in environmental sciences, does not have his bachelors degree.  Xiomara’s next plan is to wait until her daughter is about 2 years old, then apply for a master’s program in Costa Rica.

Vittana is partnering with Fundación CREHO specifically to keep students like Dulce and Xiomara in school.  With support from Vittana lenders, CREHO plans to increase the number technical and vocational school loans in its portfolio.  Mayte Portillo, CREHO’s Executive Director, has been an advocate for this partnership since our earliest conversations.  “This small amount that you contribute through Vittana,” she tells lenders, “represents an enormous opportunity for our young people to build their futures, and achieve a better standard of living for themselves and their families.”

At the end of my visit to Tegucigalpa, as Ms. Portillo dropped me off at the airport for my flight home, her cell phone rang.  After a quick conversation, she hung up the phone and turned to me:  “That was Dulce Maria.  She was calling to wish you a safe trip home, and to say thank you to Vittana for taking an interest in the students of Honduras.”

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Click here to make a loan to CREHO’s first Vittana student, 26-year-old Belkis!

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.

In a recent entry here on the blog, Vittana Fellow Nayna Gupta told the story of Mercy Marilu, a young woman from Lima, Peru.  Mercy, who works as a primary school teacher, received a Vittana loan to help her finish a degree in early childhood education.  Mercy’s story was inspiring—after finishing high school and spending years contributing to the family income by working as a chicken vendor in the province of Huaycan, Mercy eventually earned a position at a primary school teaching low-income children.  Recently, she decided to go back to school to follow her long-held dream of finishing college.  Even better? Mercy, now 27, is a mother, and her new found opportunity to finish school has inspired an even bigger dream: sending her daughter to a four-year private college.  To get started, last week she opened a savings account in her daughter’s name.

Mercy isn’t alone.  Thanks to loans from Vittana, moms like Betsy (who recently graduated from university), Nardith, Edelmira, Gulnara, and others have gone back to school to achieve their educational goals, improve their professional qualifications, and provide a better future for their children.  With Mother’s Day just around the corner here in the United States, we wanted to take a moment to recognize their hard work and sacrifice.  Already juggling the hectic, often competing obligations of work and family, a deeply held belief in the power of education drives these women to choose an even more challenging path—to take time that might otherwise be spent catching up on sleep or stealing a few minutes of relaxation with their children or spouse, and instead spend it in a classroom, studying and completing assignments, or going to and from school.

Betsy Olivares, mother of two, with her family on graduation day.

Zayda Flores Bravo and Celsa Martinez, whose loans are currently fundraising on Vittana, are two more of these special women.  Celsa lives in Encarnación, Paraguay, where she’s worked as a primary school teacher for 15 years.  Celsa and her husband, who runs his own store, have three grown sons, all of whom have finished school and joined the workforce.

With her loan, Celsa will be able to enroll in the continuing education programs made available to teachers through the Paraguayan Ministry of Education and Culture.  As she says in her student profile, Celsa is passionate about being the best teacher she can be for her students, and these continuing education courses will help her stay up to date in her field.  She also hopes that by earning additional qualifications, she’ll be able to help her family by earning a higher salary.

Celsa Martinez in Encarnación, Paraguay

As a teacher and a mom, this time of year is doubly special for Celsa.  April 30^th was Teacher’s Day in Paraguay, and when Vittana spoke with Celsa last week, she said preparations were in full swing for a big party with her students.  As for Mother’s Day, which takes place on Saturday, May 15 in Paraguay, Celsa says that her boys always take good care of her by preparing a special meal.

Vittana is proud to support mothers like Celsa as they work to improve their lives through education.  This Sunday, when we call our own mothers (or if we’re lucky, give them a hug in person) to tell them we love them, we’ll also be thinking about the millions of mothers around the world whose shared commitment to education is what makes Vittana’s mission possible.  Mothers who help their kids with homework, scrape together money to pay for school uniforms, and, most importantly, encourage their sons and daughters to dream big.  To all of them, we say thank you!

Click here to make a loan to Celsa, Zayda, or one of the many other hardworking students on Vittana.  And when you do, be sure to tell your mom!

Ulaanbaatar is cold.  Home to XacBank, an early Vittana partner and MIX Global top 100 microfinance institution (MFI), Mongolia’s capital city topped out at 10 below zero during my visit two weeks ago.  As I walked from my hotel to the XacBank office for the first time, my breath short in the dry, freezing air, I found myself at the gates of the Mongolian University of Science and Technology (MUST).  Gaggles of young people clogged the sidewalk, all of them chatting, clutching books and backpacks, and, inexplicably to me, in no rush to get out of the cold.  Weaving through the groups of students was a perfect welcome to the city, and it was fun to think that Vittana borrower and MUST student Nandin-Erdene might be among them.  With a smile frozen on my face, I hurried the rest of the way to the office to meet the team at XacBank.

XacBank Headquarters in Ulaanbaatar

When it comes to using microfinance to lend to students, XacBank is ahead of the curve.   The MFI piloted a tuition loan product in 2007, and were able to bring the program to scale by 2008.  By the time XacBank began working with Vittana in late 2009, they had built up a tremendous body of knowledge about in the ins and outs of student lending—how to research the market, how to connect with younger clients and their families, and how to structure a product that is both useful and affordable.  One of Vittana’s most valuable contributions to the field of microfinance is our ability to serve not only as a source of expertise on student loans, but also as a conduit for information to be shared between microfinance institutions.  Through Vittana, XacBank’s successes and failures in building a student loan program, become relevant not only to the students of Mongolia, but also to students in places like Peru, Vietnam, and Cambodia.

With a strong student loan program already in place, the XacBank will use its partnership with Vittana to reach even more students.  Vittana capital will also allow XacBank to offer students an incentive for timely repayment—at the end of the loan term, XacBank will open a savings account in the student’s name and deposit 9 percent of the interest paid on the loan.  So what better way to get the word out than a Vittana Opening Ceremony?

Deparment Director Munhsayhan; Vittana student Odontuya; Vittana Coordinator Densmaa; Partnerships Manager Nick Cain

With two Mongolian television networks, over one hundred students in the audience, and a handful of government officials in attendance, we definitely got the word out.  Students in Vittana shirts roamed the schools halls handing out pamphlets and encouraging their classmates to drop by the event.  With the room full, and after remarks from XacBank’s CEO and the school’s president, Vittana student Odontuya took the stage to tell the students in attendance about her experience as a Vittana borrower.  Afterwards, she was even interviewed by the local news channel.  With Vittana all over the local airwaves, XacBank is sure to see an increase in demand, so be sure to keep an eye on our website for opportunities to fund more outstanding Mongolian students!

Odontuya being interviewed about Vittana on Mongolian television.

Vittana banner at the opening ceremony.