By Bryan Goldfinger, KF10 Nicaragua
Many blogs have been written on the subject of borrower verification visits. In the borrower verification (BV) process, ten borrowers are randomly selected from the institution’s list of current loans and visited to confirm that what Kiva has posted on the website is what is actually happening in the field. To avoid various levels of fraud, neither the borrower nor the institution are supposed to have much notice of the visit (several days maximum, for planning purposes). Due to these factors, BV is typically the one project in which we Fellows are forced to go out into the wild and track down a borrower (or ten), and it often results in some of our best (depending on your definition of a good story) stories. In my first placement as a Kiva Fellow, I was a roaming borrower verification fellow, which meant that I spent my entire placement completing BV at various institutions around Peru. That said, when it came to tracking down borrowers, I thought I had seen it all, and admittedly, was maybe even slightly cocky in regards to my borrow-locating abilities. So when I came to Nicaragua to work with AFODENIC, I saw BV on my work plan, and thought it would be piece of cake.
“We’re going to have to mount beasts” was the literal translation of the Spanish email I received explaining why it would be difficult to locate Wilfredo, one of the ten borrowers selected for BV at AFODENIC in Nicaragua. After a little investigation (read: turning to ask the woman with whom I share an office), I was informed that we would most likely need to travel by mule. My immediate thought: “awesome!”
Several days later, after a two-hour-long car ride, a three-hour bus ride, and a good nights sleep, I found myself in Nueva Guinea, where AFODENIC has one of its most remote office branches. At 7am Esperanza, one of the loan officers in Nueva Guinea, and I departed in search of Wilfredo. The first leg of the trip involved a common mode of transportation called “la ruta.” “La ruta” refers to flat bed trucks with metal frames and canvas roofs covering the back. These trucks tend to follow a certain route every day (if it is passable) and pick up, what I would consider, entirely too many passengers. As we neared our destination, Puerto Principe, people began squeezing out of the back of the truck and unloading their belongings, many of which had been stored on top of the truck. During one such stop, I had my arm resting on the metal frame when a large roll of metal zinc sheets, used for roofing, came sliding off the top of the truck, the sharp edge barely missing my exposed arm. At first I didn’t think it was very close, but when I turned, I noticed that everyone around me in the truck had looks of horror on their faces, it must have been closer than I thought.
Soon after, we arrived at Puerto Principe and were informed that there were no mules we could take to Wilfredo’s farm, so we began the two-hour trek on foot. Ten minutes into the walk, I was poking fun at Esperanza because she was nervous to walk across a log that spanned a small muddy swamp. Immediately after she crossed successfully, I proceeded to fall into the pond, completely soaking myself from the waste down, and shrinking my pride to the size of an ant. Instant karma. After a good laugh and a couple photos, I spent the next hour and fifty minutes sloshing along dirt paths. Some time later, while trekking along a trail through a grove of trees, I was attempting to walk and film simultaneously (I should have known better). I managed to catch myself on film clumsily taking quite a spill, you can see my cell phone and other items come flying out of my backpack (see included video), and then hear me try to play it off like nothing happened. Eventually, we arrived at Wilfredo’s farm. After greeting us, and showing me where I might hang my shoes and socks out to dry (taking off my jeans may have been stepping over the line) Wilfredo and his son set out to round up their cattle. They were excited to show us all the cows they had purchased with loans from AFODENIC, many of which were funded by Kiva. While they were out, Wilfredo’s wife prepared us a delicious breakfast that consisted of eggs, beans, rice and yucca, all of which were raised on their farm. I also learned that being so far from town, most houses in the area do not have electricity. However, also through a loan from AFODENIC, Wilfredo was able to purchase a small solar panel, which produced enough electricity for them to power a television, refrigerator and their lights.
Once we had eaten, conversed and taken pictures with a couple of kids who had stopped by from nearby houses to see what the “chele” (white person) was doing, Wilfredo called us over to the corral. He proudly pointed out each of the cows he had purchased with capital provided by AFODENIC and gave me the details of how much milk each one had produced. At this point, our journey was halfway through. We had reached the borrower, interviewed and taken pictures, and the real fun was just about to begin. From the corral, Wilfredo showed us around the back where he had three mules saddled and ready to take us back into town. I think when I explained to Wilfredo that I had ridden a horse one time on a guided tour, he assumed I meant that I was a professional. He basically hopped on and took off. When I shot his son a questioning glance, the kid made a motion to kick my heels into the side of the mule. I did so, and off we went. It turns out, this was arguably the smoothest part of the entire trip; no falling sheets of metal, no barbed-wire fences to be squeezed through, ponds for me to fall into or trails for me to trip on, just me and the mule (who apparently was more sure-footed than I). As we trotted back into town, I realized that the sleepy town we had arrived into that morning had transformed into a bustling main street that appeared straight out of an Old West movie. Everyone was on horse. We even passed a bar to which one could approach a window from the outside and order a drink without having to dismount their animal. Once we arrived at the departure point for the next “ruta” vehicle, we said thank you and goodbye to Wilfredo, and hopped on the truck. Three hours later we were back in Nueva Guinea, very dirty, still wet and absolutely exhausted.
For a short video with some of the highlights of this day, including me falling on my face, check out this video… '
That was just one borrower of the ten selected. During the entire BV process, we traveled by bus, taxi, “la ruta,” in a truck, on the back of a motorcycle, on foot, in boat, by mule and we even hitched a ride in the back of a milk truck (if you have never experienced the aroma of 15 barrels of warm milk in an enclosed space in 90 degree heat, you must, it’s enlightening).
This is by no means what loan officers at microfinance institutions do on a daily basis. The above story does, however, lend some perspective to how difficult it can be to reach many borrowers of the institutions that Kiva works with. When one thinks about the locations that many of the borrowers live and work in, it begins to make sense why the operating costs of MFIs are so extremely high, and seemingly high interest rates begin to make a little more sense. Can technology be used to avoid having to visit these clients frequently? Yes. Could MFIs try to improve their processes to cut the costs of having to make trips like the one described? Sure. But the fact remains that many of these clients still need to be contacted face to face. As it stands, microfinance is a very personal business; the relationships between loan officers and their clients is often a very close one, and there is a lot of trust involved on both ends, making field visits a crucial part of the process.