Cost of Lesson: 30 cedi

April 23, 2008

30 cedi (about $30): The amount liberated from my hands by the black market money changer in Accra.

After a surprisingly easy negotiation over the rate (25 cedi to 10,000 CFA- better than the international bank rate!), it was an altogether friendly experience. I counted the money, making him add bills- there were only 7 cedi missing at that point. Then he grabbed it out of my hands to be recounted, as new boys showed up to help with the transaction. I then had to count the cash again, at which point he grabbed it out of my hands, passed it to another boy, who put a rubber band around the cash and gave it back to me. I finally got a hold of the money, put the thrice counted amount in my bag, shook his hand, and walked with purpose down the alley as fast as I could into the crowded market. It took me a couple hours to recount the money before I figured out that 30 cedi was missing. What a rookie.

How did I end up in this situation? On a weekend trip to Ghana (I am based in neighboring Togo) I hitched the 4 hour bush taxi to Accra. Intimidated by the mass of money changers at the border, and convinced that I didn’t want to pay to exchange money twice (Dollars to CFA to Cedi), I took just enough cash to get to Accra, and a few extra bucks for a cab to town from the bus depot. Once I arrived, I walked to four different banks and then took a taxi to three more only to discover that there are literally NO banks in the country that accept my ATM card. Note to travelers: Ghana only has the Visa network, no mastercard to be found anywhere. I hear the same goes with Mali. Walking up from the market place, with 2 cedi in my pocket, not enough to pay for a cab ride back to the bus depot, this charming young man offers me a good rate on money changing.

Lesson #1: Hustlers are really friendly and nice!

Lesson #2: Change money at the border where there are dozens of money changers- as it turns out competition, and a small marketplace do result in better rates. Although they give you a rate of 23.5 to 1000 CFA, they don’t steal an extra 30 cedi in the transaction. Also, they offer a better rate than my bank, given all the fees.

The duh lesson: When the negotiation is too easy, you’re getting ripped off- a variation on when it sounds too good to be true…

Cheap Lessons in West Africa

April 23, 2008

When I left for West Africa, I promised my mother I would practice making good judgment calls. It’s very much in my nature to venture off on my own, discover new things and people and follow them to interesting places. After getting lost in a jungle on the outskirts of a rural town in El Salvador on a one-eyed horse until nearly midnight all alone but for the workmen came home up the dirt road with nothing but their machetes, and stray dogs meandering about… I agreed that it was time for me to be more aware of my surroundings, and the situations I put myself in.

Good judgment calls usually involve NOT doing something… So to say that it is not easy for me to do this is an understatement. But all the same, I have been conscientious of safety on this trip more than ever before. Perhaps the wisdom that comes with age… and perhaps some things only come with experience.

My next few entries will be about some of the cheapest lessons I have learned in West Africa so far…

Clients, Loans & Stickers

February 4, 2008

On Friday everyone shows up at the office dressed up. Mostly for religious reasons, but it’s a refreshing reversal of casual Friday. It’s our all-hands day, where everyone from the different parts of Abidjan meets here at 4pm. I saved the chocolates I brought for this day, and shared with everyone. I really enjoy meeting all the field officers- they are truly the heart & soul of this operation. Everyone I have met so far has been enthusiastic and friendly.

It is a hard life here.  I walked through the market last night, it’s an open-air market much like you’d see in Mexico, with each vendor selling fruits, veggies, live crabs, raw meat, toiletries, etc. I want to just reach out and buy something from everyone. But of course that’s not the answer. It has to be a sustainable system from within, and the capital from Kiva to augment that system is a much more effective jumpstart and monitored much more closely than if I just go around buying stuff I don’t need!

I sat with the HR women yesterday to count the money from the markets, and talk about their processes. There are two different types of loans, the individual loan and a group loan.

The group loan is for women only, and it is coordinated in groups that start out as 10, and end up around 5-6 women. The women self-select their group, so that they determine to whom they will be accountable. Every woman in the group becomes responsible for the entire payment due each week, so that if someone is missing, the others must make up that amount and be reimbursed later. No three people from the same family are allowed in the same group. This is for many reasons- if there is a funeral in the family, then all three would leave at the same time, leaving the others in the lurch for that week. Or even worse, once they’d taken their share, they could just leave period.

There are two different ways of splitting up the group loans. One way is that one woman at a time gets the whole sum of money, and they take turns. The other is there is a total sum, and it is divided between the women equally. They use an evaluation form on many variables, including how many children each woman has, number of years experience in her field, if she has a criminal record, etc. Each woman fills out this form, and it is rated for risk. They add up the risk points for the group, and determine the loan size, and how it is split among the women. The majority of AE&I’s loans are individual, but the group loan is a good way for a woman to get started and develop credit with the institution. She can then transition to an individual loan. In talking with women in the markets, many of them started with a group loan, but much prefer the individual loans they are now doing. This is for the clear reason that when other members of the group defaulted, they had to pick up the amount.

If the woman hasn’t established her credit in a group loan, then before she can take an individual loan, she must start with a savings account. They meet with the potential client and talk to them about the business, what they would use a loan for, their family circumstances, etc. They explain to them that before they can get a loan, they must open a savings account and contribute a small amount to that savings account on a daily basis. The client determines how much they will contribute to this savings account. Most choose to contribute between 50 cents and two dollars per day.

After three months of diligent payments, AE&I adds up the amount. At any time during those three months if the person wants to withdraw their money, they can do it. But if they leave the money in savings, that serves as the collateral for their first loan, and they can be loaned that exact amount. Only their first loan has this collateral structure. And this is what I find interesting. This first loan is not the transformational loan- it is the screening process for quality clients. And these clients continue to work and expand their business, taking progressively larger loans in small increments. Then, once they feel confident, they can take a relatively larger sized loan, and use it to significantly upgrade their business. It is in this way that AE&I has cultivated a portfolio of trustworthy and thriving clients.

Savings and loan payments are tracked in a passbook that the borrower keeps. They pay 1000 CFA (about $2) for the passbook, so that they are careful not to lose it. When the clients make their deposit each day, they receive a hologrammed sticker for that payment in the passbook. There are different colored stickers, each with a different monetary value. This makes it easy to add up the amount contributed each month by counting up the stickers, and multiplying by the value of their color. The stickers allow borrowers, even those who cannot read and write, to track their savings, withdrawals, and loan payments easily.

In a country where corruption claims so much money, AE&I has set up a strong infrastructure to protect their clients and ensure the quality of each of their loans. Each transaction is documented in several steps, with cross checks between the computer system and handwritten logbooks. The Internal Auditor tracks the amount of stickers that are used by each loan officer on a weekly basis, and matches that number with the deposits and loan payments. And the Internal Auditor also visits clients in the market to follow up on late loan payments, and also spot checks to see that the passbooks match the loan records at the office. Microfinance is such a simple concept, but seeing the operations in the field has given me a deep appreciation for the complexity of its execution.

The Client Passbook:

  Passbook- cover Passbook- page 2

Maman Fannie missed her appointment!

February 1, 2008

Just a quick post for those who were wondering how the meeting with Maman Fannie went… she missed her appointment! I was so bummed. I stopped by her apartment that night, and it turns out one of the children had gotten sick, and she’d taken care of her. But I had the sense that was just an excuse. She’d never even heard of microfinance before I talked to her about it, and so I imagine there is some hesitation on her part to meet with a financial institution on her own. I’m giving her space, so she doesn’t feel pressured by me… but next week, I’m going to see if I can bring her with me to the office one day for a short meeting. :)

Maman Fannie- my neighbor!

January 28, 2008

I first met Deborah, an 11 year old girl, when I was looking for the trash cans outside my building. She happily showed me the way and started chatting me up. Then I met Colom, her older sister, who is 18 and very sweet. We became friends, and they asked if they could visit me sometime. I said, of course, anytime! That same night, when I walked up to my apartment building from work, they were both standing there with a younger boy waiting, and holding a grapefruit as a gift for me.

That first night we talked for a long time. Colom said she’d just moved here one month ago from the Congo (Brazzaville), to be with her mother. She misses her friends and her life in the Congo, and doesn’t know when she’ll be able to go back. Meanwhile she’s in school here, and enjoys her studies. Deborah and her brother teased each other and played around. They were both engrossed in my French grammar exercise books, and Deborah pointed out to me that it would be better if I wrote in pencil so that when I was done with the exercises perhaps someone else could use the book as well, and then it would not be wasted. She is a smart girl, and I hope we get to spend more time together. That night we played music, and had a good time together.

The next day I saw the girls, and they invited me for a visit. They came to my apt to fetch me at the specified time, and we went down to their apartment together. There I met their mother, Maman Fannie. Maman Fannie has a bright smile, and said that she’d heard the kids were very excited to meet me. While we talked, she sat and filled plastic bags with water. She has a big freezer in her living room. She filters the water from the tap through a cloth stretched across a plastic bottle and uses that as a funnel into a plastic bag. Once full, she ties the bag tight, and puts it in a pile to be loaded into the freezer for sale in the market the next day. She explained that she’d had a filter on her tap, but it broke recently and so she wasn’t able to filter the water as well. We talked about why I was here, for microfinance, something she’d never heard of. So I explained it to her. My first thought, of course, is that she is the ideal candidate for a loan. And she too had that same thought! I didn’t want to get into the technical loan process details on my own, so we agreed to meet on Tuesday and I would take her down to AE&I for her to meet with a loan officer.

From there our conversation moved from business to more personal subjects. She told me that when she first moved to Cote d’Ivoire from the Congo, she came with her husband for his job. They lived in a large house in another neighborhood. The house had eight rooms, and they had several children together. She told me that they had a housekeeper and a chauffeur. The chauffeur took the kids to school each day, and spent a good deal of time with her as well. After living with her husband in Cote d’Ivoire for several years, and over ten years of marriage, he abandoned her. The chauffeur and housekeeper arranged for him to meet a younger woman, and he left Maman Fannie to marry this other woman. He sold the house where they lived, and left her with the children, and no way to get home to Congo. Shortly after he did this, he lost his job, and left to live in France with his new wife. He never provided her any support, and has had no contact with his children since he left.

Now picture this woman sitting in front of you, filling up bags of water, and smiling- a big smile- as she tells this story. I could hardly believe it. This happened only three or four years ago. She now lives in a one bedroom apartment on the first floor of my building. In this apartment she takes care of Colom age 18, Germe age 12, Deborah age 11, and Manu age 5. While I was there, another daughter Sandrine visited, and her oldest son, Christian. (As a side note, I am not entirely clear on the exact biological or adopted relationship of each of these children. And so in my previous post I thought Colom had two children, which she does not. It seems a moot point to try and clarify these things immediately, as it doesn’t affect the fact that they’re all family and take care of each other as such.)

The children had all been going to high-priced private French schools in Abidjan. She could no longer afford these schools, but still she pays for every one of the children to go to a private school, and she works with them each night on their homework. Because she cannot afford to send them to the best schools, she emphasizes the importance of studying even harder so that one day they will have more opportunities. Tonight Colom took me for a walk to her school. It’s a fenced-in school, with a beautiful tree in the center of its courtyard, and a sandy play area for soccer games. The schoolgrounds were clean and well-kept. We visited her classrooms on the second floor. The classrooms have two large chalkboards along one wall, and several rows of wood desks and benches. In the warm spring air, I could smell the wood from the desks as I entered each room. Each room was a quick look into the day’s lesson. In the first room there were English sentences on the board. Next door we found Ivoirian history, and further down was a science lab with tiled desks, and kinetic Physics equations on the board.

Colom is currently in her 3rd level. I’m not entirely clear on the French system, but high school goes 6-5-4-3-2-1-Finished. So in three years she will take the Bac (the super tough French exit exam that determines where you can go to university), and apply for entrance to a university. She wants to be a lawyer. She said that there are many people in her family who have education but never went to work, or never completed school. Maman Fannie counts heavily on her to complete her studies, and pass the Bac with a good score so that she can advance herself. Then she told me that she is an orphan, that her mom died in the war in Congo. She wants to work to improve the lives of other orphans, and help them find a better life too.

I spoke with Ladji, one of my co-workers at AE&I about Maman Fannie. He said that she sounds like an ideal client- cold water sales is a very strong business model in Abidjan (because it’s hot here!!). He said that I will see what happens after she first takes one loan, pays it off, and then takes another loan and expands further… They have clients who started out with a small stand selling one vegetable who now have entire stores of merchandise. He pointed to a store the size of a New York hotel room- small, but it serves its purpose. I asked how many years that must’ve taken- and he pointed out that AE&I is only four years old. With the right person, microfinance can enable them to accomplish great things very quickly. I am looking forward to Maman Fannie’s appointment on Tuesday… and for my next eight months in Cote d’Ivoire.

Megan’s in Cote d’Ivoire!

January 26, 2008

I’m Megan, and I am volunteering as a Kiva Fellow with Afrique Emergence et Investissements, a microfinance institute in Abidjan, Cote d’Ivoire. I arrived Monday night (1/21) and have been working in the main office since Tuesday. Already I am impressed with how well this organization is run, and the vision and enthusiasm of the team. To me, enabling partners like this is what Kiva is all about.

I was greeted at the airport by Madame Coulibali and Rahambatou, two women from the office. Technically they are the HR team, but in reality they take on a wide variety of responsibilities. They are very much the office moms. Before I arrived they had rented an apartment on my behalf, and set me up with a bed and a fan. My apartment is in the Angre area (pronounced On-grey, not angry), a residential area within Abidjan. It’s about 30 minutes from downtown, au Plateau. Abidjan is an enormous city, with a population of about 4 million, and traffic worse than LA!

For a country the size of New Mexico, Cote d’Ivoire is extremely diverse. There are over 60 languages, different ethnic groups and religions, and many citizens come from neighboring countries such as Burkina Faso, Ghana, Mali, Togo, Nigeria, Liberia (and the list goes on) but also from around the world. Within two blocks of my apartment is a Lebanese restaurant and a Chinese one, both family owned.

Last night I met one of my neighbors, who is from the Congo. Her name is Colom (pronounced koh-lohm), and she is living here with her mother, younger brother, and her two children. Her daughter Deborah is eight years old, and charmed me immediately with her outgoing personality and sharp intelligence. We are meeting tomorrow night to make dinner together, and I am looking forward to it. The food here is amazing! Fresh fruits- papaya, pineapple, grapefruit, plantains… and grilled fish with couscous or rice. Yum!

I live less than half a mile from the office, and so it is an easy walk each day. It makes me happy to think that I’m going to be here for eight months, and see the same people on my walk each morning. As I pass each shop, I wonder where my work with Kiva will take me. I can’t wait to have an excuse to stop by different shops and meet people!

Madame Coulibali at her desk:

 Madame Coulibali

And Rahambatou…

 Rahambatou


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