Jordan Coriza

Article

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On a grey day on the tail end of monsoon season in Yangon, Myanmar, a group of women gather in an office. Among them are many trades—fishing, carpentry, weaving, farming, and manufacturing, to name a few. But the women all have one thing in common—they need financing to expand their businesses.

The financial services industry in Myanmar is so nascent that most entrepreneurs who need capital are forced to turn to informal arrangements such as expensive moneylenders. But these women have the benefit of participating in a group-lending circle. The circle provides very small loans, some as low as US$60, to help the entrepreneurs in the group build their livelihoods, one small step at a time.

Myanmar itself, meanwhile, has recently taken giant steps forward. With a new government in place as of April 2016 and trading begun on its <a href="http://pubads.g.doubleclick.net/gampad/clk?id=476987306&amp;iu=/2">first stock exchange</a> in March, Myanmar is opening itself up to the rest of the world after 50 years of isolation. Foreign investors are racing to gain a foothold in Myanmar. The mobile phone market grew 300 percent last year alone among a population eager to connect. SIM card prices dropped dramatically—from US$2,000 to US$1.50 in 2014—and Myanmar is now the third fastest-growing mobile market in the world (after India and China).

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But what does this mean for the country’s economy? Recently, banks have begun to team up with network operators to offer mobile access to their bank accounts through apps and SMS. The potential for this service, along with explosive growth of the industry itself, has huge implications for customers who may do business hours away from a bank branch, or who need to send money in the region but have no efficient means to do so, or who, like the women in the lending circle, need basic banking services in a country where mobile phone service is expanding a lot faster than banking.

Among the many new providers working to reach that underserved population, Accion partner DAWN, a microfinance institution focused on group lending for women, has been active in the space since 2002. Now, DAWN is poised to take advantage of the recent influx of foreign interest, investment and new business—and use it to better serve its 60,000-plus clients. DAWN is opening new branches for its growing base of entrepreneurs and introducing new products to meet their evolving needs. As DAWN and others across the region are seeing, Myanmar’s small businesses are improving alongside its economy.

Although the industry is young and the country’s public infrastructure is still developing, mobile banking providers and players such as DAWN are uniquely positioned to leapfrog years of seclusion in Myanmar with exciting new technologies and business models, designed with the shared goal of improving the lives of many people for a country in need.

<em>This post originally appeared on <a href="http://partners.wsj.com/metlife/multipliers/articles/myanmars-economic-revolution/" target="_blank" rel="noopener noreferrer">The Wall Street Journal’s Multipliers of Prosperity</a>, in partnership with the MetLife Foundation.</em>

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Myanmar’s economic revolution

To start a business is to take a leap of faith. That’s what farmer Emma Guadarrama and her husband Genaro Acosta did five years ago when they decided to build two expensive greenhouses to grow organic tomatoes. They had heard that organic produce was in demand in the nearby Mexican town of Ixtapan de la Sal, where they sold their product every weekend during harvest season. They also knew that the town had some of the highest rates of birth defects in the country, because, according to Genaro, the flower nurseries in the area where so many young women worked used hazardous fertilizers and chemicals.

“If we can grow good produce without so many chemicals,” Genaro says, “we can really help the women and children in our community.”

It was a perfect plan. The only problem was that they didn’t know the first thing about organic farming.

Genaro took classes from a government-run agricultural program a few miles away. He learned a variety of methods for prepping the soil, which included using bone meal, egg shells, and animal blood. He also learned techniques for nurturing the roots of the tomato seedlings, which included a paste made from lentils. He even learned how to keep pests away with a mixture of coca cola, fabric softener, and milk.

Things were off to a good start, but then tragedy struck.

Just a few months after they’d planted their first tomato crop — which requires a significant amount of care and attention — a storm destroyed one of their greenhouses. The entire structure collapsed under heavy rain and wind, wiping out the entire harvest.

“When that happened,” Emma said. “I sat down, watched the wreckage, and just cried.”

But with the same resilience of any hardworking farmers, Emma and Genaro quickly sprang into action. They approached Accion partner CrediConfia for a loan. They had already borrowed from CrediConfia once, to build one of their greenhouses. The new capital helped them get back on their feet quickly.

<img class="alignnone size-large wp-image-6846" src="http://blogs.accion.org/wp-content/uploads/2016/04/organic_farming_Emma_Maria_Guadarrama_of_Mexico_client-of_CrediConfia_and_Accion-3-1024x683.jpg" alt="organic_farming_Emma_Maria_Guadarrama_of_Mexico_client of_CrediConfia_and_Accion 3" width="1024" height="683" />
Although they don’t have a formal savings account, every time they get a small surplus of profits, they invest it back into the business — anything from new tools for their tractor or the bees they need to pollinate the tomato plants.

Their customers are happy, Emma reports. “The ladies I supply at the market love my tomatoes. And they complain when I tell them our harvest is about to end. That’s why we’re busy building another greenhouse, so we can have rotating crops and a constant outflow of produce.”

As for Genaro, he’s been spreading the word about the benefits — both financial and environmental — of organic farming. He’s been teaching his techniques to neighboring farmers. Emma is looking forward to starting a course to learn how to make tomato shampoo, soap, and other tomato-scented products.

Sitting under the shade of a mango tree, Emma talks about the hardships of being a farmer. She recounts the recent damage to her kitchen roof, and how she had to cook on a wood fire outside while making the repairs to the building, which took a long time due to her lack of cash flow.

“We have made many sacrifices to have this business,” Emma says. “I don’t have big aspirations, but I want to meet my family’s needs.”

Emma and Genaro are not just meeting the needs of their family; they are sowing the seeds of a healthier community. With determination and small loans from CrediConfia, they’ll soon reap the fruits of their labor — well beyond their tomato greenhouses.

<img class="alignnone size-large wp-image-6847" src="http://blogs.accion.org/wp-content/uploads/2016/04/organic_farming_Emma_Maria_Guadarrama_of_Mexico_client-of_CrediConfia_and_Accion-1024x683.jpg" alt="organic_farming_Emma_Maria_Guadarrama_of_Mexico_client of_CrediConfia_and_Accion" width="1024" height="683" />

Making a difference with organic farming in Mexico

Work hard, be honest, remain humble. That was the direction given to microfinance expert Masuna Chikami by his father when he graduated from high school in Masvingo Province in Zimbabwe — a hard reality for a man with great ambition. The memory of those words remains fresh almost 30 years later, as “Chikami,” as he is known to friends and colleagues, traces the arc that brought him to Accion’s Africa hub in Ghana.

Mindful of his responsibilities as the second of nine children and the need to not only support himself but also help his siblings, Chikami began applying the work ethic for which he’s now known. His first job was as a temporary teacher, and he saved money to take his agriculture qualification courses. After putting himself through school, he secured his first job as a loan officer for an NGO in Zimbabwe, where he worked with women in rural areas. “The women were so happy to see me when I would arrive,” he explains. “And it was so inspiring to see people working so hard and paying back their loans.”

He was quickly promoted and continued to rise through the ranks of microfinance, keeping three instructive principles front and center at every step: honesty, humility, and hard work. Those values were instilled in him by his late mother, who always welcomed him to his hometown of Chivasa but would soon send him on his way, saying, “You need to go back to work.”

Accion had the great fortune of getting to know Chikami when he was serving as the general manager of MicroKing, a former Accion microfinance partner in Zimbabwe. He joined Accion in 2006 to help launch <a href="http://www.accionmfb.com/" target="_blank" rel="noopener">Accion Microfinance Bank (Accion MfB)</a> in Nigeria.

When he started, Accion Microfinance Bank had no banking license, no branches, and no clients – just one small room shared by five people who were working to get the institution off the ground. The hours were long – typically until midnight – but he holds the project up today as his proudest moment. Accion Microfinance Bank is now reaching more than 120,000 savers and over 43,000 loan clients through more than 300 loan officers and 31 branches, and Chikami continues to manage teams of Accion consultants who pilot new products and technologies that stand to improve the bank’s reach, client service, and efficiency. “One thing that helps me fit in well here,” says Chikami, “is my ability to work with a diverse group of people. My work and life experiences give me perspective on different cultures, professional backgrounds, and business problems. So, I’m able to support our partners and build strong relationships with them.”

Chikami has accomplished a great deal in collaboration with his technical assistance teams and our four partner MFIs, which are currently reaching some 83,000 clients in Africa. He sees great possibility in the region, as digital finance continues to take hold and improves access and convenience. But he cautions that client protection is critical — especially for Africa, as many new players enter the market not all with the clients’ best interests at heart. He and the team at Accion are working to promote strategic leadership in the region and ensure that best practices are enforced throughout the industry through a staunch commitment to training and capacity-building.

Behind the scenes: Masuna Chikami and Accion Microfinance Bank

Every business begins with a vision. But Francisca Romero’s idea of a vocational school was more than a business; it was a social enterprise. She wanted to provide career options, empowering young women in her impoverished rural community who had little prospects beyond peasant life.
<h2>A vision of opportunity</h2>
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[caption id="attachment_5962" align="aligncenter" width="800"]<img class="size-full wp-image-5962" src="http://blogs.accion.org/wp-content/uploads/2016/02/empowering-young-women-in-rural-Paraguay-Asuncion-Accion-client-Francisca_Romero-runs-girls-vocational-school.jpg" alt="empowering-young-women-in-rural-Paraguay-Asuncion-Accion-client-Francisca_Romero-runs-girls-vocational-school" width="800" height="534" /> Francisca Romero García, client of Fundacion Paraguaya owns a teaching institute in Concepcion, Paraguaya.[/caption]

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But starting a school is hard work, and doing it without capital in a remote rural settlement seemed impossible. So Francisca did it the only way she could: under a tree behind her parents’ house. In 1973, she started teaching young girls the skills she’d learned in church – sewing, knitting, embroidery.

Forty years later, Francisca’s professional institute occupies a building adjacent to her house in the city of Concepcion, some 250 miles north of Asuncion, Paraguay. Similar in scale to her first class under the tree, the school building started out as one room.

Without access to any formal financial services, Francisca slowly expanded that one room with money she borrowed from family members. It was a tedious process, requiring enormous patience and determination. In 2010, however, Francisca learned about Accion partner <a href="http://www.fundacionparaguaya.org.py/?lang=en" target="_blank" rel="noopener noreferrer">Fundación Paraguaya</a> from one of her students. She applied and got her first loan, which she used to build more classrooms.

Today she employs five part-time teachers, many of whom are graduates of the school themselves. The institute offers no less than 13 different courses of study, from esthetics — hair styling, manicures, and pedicures — to electricity, cooking, decorating, and more. Most take one to two years to complete.
<h2>Empowering young women</h2>
A sturdy woman in her mid-sixties with a pleasant voice, Francisca gives us a tour of the facility. We pass by student manicurists, who have to learn 100 different nail styles and rehearse them on one another. She pauses to correct one of them, indicating how to position the client’s hand properly and grip the brush more steadily.

Though her school is successful — no doubt due to Francisca’s personal touch — it is still very much a small enterprise. Francisca does everything from enrollment to payroll, teaching, and advertising.

“Girls start knocking on my door as early as 5 a.m.,” Francisca says. “They want their lessons before catching the 8 a.m. bus back out of town to attend to their daily responsibilities.”

Francisca’s steadfast commitment to education has earned her recognition. In 2000, Paraguay’s Ministry of Culture and Education granted Francisca’s school official status, meaning that Francisca can issue diplomas, which, in turn, can help her students access jobs more easily.

“My dream is to get a government salary, so I can lower my fees,” Francisca explains, referring to the potential but challenging process of obtaining a teacher’s salary from the government to run the school. “It’s important to note that I serve very low-income people from the surrounding villages. My students are very poor, and it’s hard for them to pay for both the classes and the school supplies they need.” Her school currently has 270 students enrolled in classes.

Later that afternoon we visit a young mother running a bodega out of her home in the vicinity. When asked about her aspirations for her business, she tells us she wants to enroll in Francisca’s school because, in her own words, getting an education is the only real chance to ensure a more promising future for herself and her family.

Whether the coursework was conducted under a tree or in one of several classrooms, the success and impact of Francisca’s school are undeniable — something of which we were privileged to have been a small part.

Empowering young women in rural Paraguay

If Accion’s 53-year history were represented as a pie chart, it might arguably have only three slices: one for the first 10 years it committed to community development projects, another for the last five-plus years it has dedicated to exploring frontiers beyond microfinance, and a hefty slice in the middle representing all the years in between that Accion devoted solely to creating microfinance institutions.

A former Jesuit missionary by the name of Stephen Gross is possibly one of the most important actors in that middle period, having played an instrumental role in the creation of microfinance institutions in the Dominican Republic, Ecuador, Guatemala, Costa Rica, Bolivia, Panama, Paraguay, and Nicaragua. Those institutions currently serve millions of micro- and small businesses across Latin America and the Caribbean and have been the testing ground for innumerable products, services, and practices that are replicated by microfinance programs around the world today.

Only a handful of other early Accion employees enjoy a legacy as rich as Steve’s. From the institutions he established to the myriad courses he developed and taught to the hundreds of professionals he trained and motivated, his story is as inspiring as it is remarkable.

[caption id="attachment_431" align="aligncenter" width="1024"]<img class="wp-image-431 size-large" src="http://blogs.accion.org/wp-content/uploads/2015/12/Steve-Gross-ordination-Accion-microfinance-1024x967.jpg" alt="Steve-Gross-ordination-Accion-microfinance" width="1024" height="967" /> Steve Gross at his ordination.[/caption]
<h2>Jumping in with both feet</h2>
Accion recruited Steve Gross in 1977 and deployed him to the Dominican Republic. His first assignment was to develop and teach a managerial training course for farmers who were receiving loans from the Dominican Development Foundation. The 15-month course Steve developed, which met twice monthly and for which he wrote and helped illustrate some 40 study books, was initially piloted in one community but quickly spread throughout the country. In addition to teaching the courses himself, Steve trained trainers, who would then go out to teach groups of farmers. Classes covered skills such as budgeting, cost projection, prices, marketing, sales, production, loans, capitalization, bookkeeping, quality control, and so on.

Once the program was well established, Steve and his Accion colleagues pitched a new idea to the Dominican Development Foundation: to create a microcredit program in the poor urban areas of Santo Domingo. Everyone was keen, except for one small detail.

“We knew what could be improved based on our experiences in Brazil,” Steve said, in reference to adapting the lending methodology that Accion had created and had been using in that country since 1973. “We knew you could lend money and get it back, but we also knew we had to get the loan size and term down to what the clients could handle. We realized [in Brazil] that even a $300 loan to be paid over one year was too much. We had to get the loan to a smaller amount that could be paid in a shorter amount of time, thus giving the client a reachable goal and a sense of success when they paid off their debt.”

But the Dominican Development Foundation didn’t agree with Steve, so he looked for other people who would be willing to look at the Accion methodology and run with it. And he found them, of all places, on a Wednesday night in Santo Domingo, sitting at his poker table.

Pedro Jimenez was a successful businessman who had spearheaded the establishment of the first duty free zone in the Dominican Republic. Camilo Lluberes was a banker and big businessman Steve described as an idealist. When Steve explained his desire to create a microenterprise development program for their country, both men jumped in with both feet.

To get the program started, Pedro and Camilo contributed their own funds and, with them, were able to raise more money from USAID. That initial microcredit program, which employed Steve’s idea of smaller loans at shorter terms (and charged interest to cover its costs), would eventually become Banco ADEMI. Today, with 48 branches and more than 166,000 clients served with approximately $250 million in loans, ADEMI is one of the Dominican Republic’s premier financial institutions serving micro- and small enterprises.

<img class="aligncenter size-full wp-image-447" src="http://blogs.accion.org/wp-content/uploads/2015/12/Steve-Gross-Accion-microfinance-chalkboard.jpg" alt="Steve-Gross-Accion-microfinance-chalkboard" width="746" height="529" />
<h2>Key realizations</h2>
Steve calls the events he witnessed during his tenure at Accion “evolutionary stages of growth.” The term refers to a series of assumptions, organized in chronological order, that were formulated based on past experiences building microcredit programs and that had to be corroborated before moving forward. For example, what happened with the creation of ADEMI in the Dominican Republic corroborated Accion’s fourth hypothesis: that even the poorest of the economically active were willing and able to pay for the necessary services for their own development, and that programs that worked with them could cover their own costs. Previous hypotheses proven in Brazil and Colombia included: 1) that it is possible to lend money to microenterprises and get it back, 2) that it is possible to replicate the experience of Brazil in other countries in Latin America, and 3) that it is possible to reach the poorest sector of the economically active with loans of $100 or less.

Following his work in the Dominican Republic, Steve relocated to Quito to help the Ecuadoran Development Foundation create an urban microenterprise lending program. Using a similar credit methodology to the one applied in the Dominican Republic – as well as providing microentrepreneurs with business management courses – the program flourished. Still in existence today as one of many services offered by the Ecuadoran Development Foundation, the microcredit program serves thousands of microentrepreneurs throughout Ecuador.

Then came Paraguay.

By the time Steve arrived in Asuncion in the early eighties, he had realized a few things. First, the key to establishing a successful and enduring microcredit program was to identify two fundamental players: a person who could command the attention and respect of high-profile people to head the board of directors, and another with strong leadership skills to run the daily operations of the organization.

A second realization was that those young organizations’ success depended – in a fundamental way – on the commitment and motivation of their staff. So strong was Steve’s belief in this that he designed an entire management and communication training program based on the following four principles:
<ol>
 	<li>The task of creating microcredit programs is of such magnitude that only an excellent organization can adequately respond.</li>
 	<li>An excellent organization is composed exclusively of excellent personnel.</li>
 	<li>People can aspire to excellence to the extent that they feel that they are on the road to satisfying their personal and professional needs.</li>
 	<li>The responsibility for creating, maintaining, and strengthening such a productive working environment must be borne by each and every person in the organization.</li>
</ol>
Based mainly on heuristic games and with a strong emphasis on the ideology of microcredit – faith in its transformative power – the training program was such a resounding success that Accion made it a part of its modus operandi, sending Steve to every partner institution to deliver the three-day classes at least twice per year.

“These courses worked very well throughout Latin America,” Steve says. “And you say, ‘Yeah, but that’s just the Latin temperament.’ But then [after Accion] I gave these courses in South Africa, Jordan, Ramallah, the West Bank, using the same exercises and the same games. And it turns out we are all alike. Human beings are all alike. And what motivates us in one part of the world motivates us in another.”

<img class="aligncenter size-large wp-image-451" src="http://blogs.accion.org/wp-content/uploads/2015/12/Steve-Gross-Accion-microfinance-water-pump-1024x730.jpg" alt="Steve-Gross-Accion-microfinance-water-pump" width="1024" height="730" />
<h2>The kindness of microcredit</h2>
Strange as it may sound, Steve’s strategy for setting up a new microfinance institution was very simple. He would identify the two people for the critical roles of executive director and board president, help them settle in over one to two weeks and leave them to run the organization. He would then stay in touch with them by phone and correspondence, only coming back to deliver his management and communication courses occasionally.

“When I came to a new place with the Accion ideas,” Steve says, “most of them would look at me like I was crazy. They would say, ‘Well, that can be done in Guatemala, but not here in Colombia,’ or ‘That can be done in Colombia, but not here in Paraguay.’ And that was conventional wisdom in all these countries until we had a track record of all the previous programs.”

Juan Álvaro Munguía was the legal advisor to Nicaragua’s president, Violeta Chamorro, when he met Steve – whom he affectionately referred to as Esteban – in Managua in 1990. “Esteban talked to us about the kindness of microcredit after a terrible war, when the country was in much need of kindness and healing. So we started looking for people. Esteban said that we had to form a reconciliatory institution, meaning that we should involve Sandinistas and non-Sandinistas, but it was very hard. When I was ready to give up, Esteban would urge me to keep going and say, ‘We can do it.’”

The organization Munguía started is called Financiera FAMA, which was incorporated in April of 1991 and gave its first microloan to a solidarity group in 1992. During that first year, the organization disbursed 75 loans. In 1995, FAMA purchased its first building and christened it the Esteban Gross building. Today, FAMA is a fully regulated financial institution, having lent approximately $500 million and with a network of branches that serve the entire country. At 72, Munguía is still chairman of FAMA’s board.

[caption id="attachment_427" align="aligncenter" width="599"]<img class="size-full wp-image-427" src="http://blogs.accion.org/wp-content/uploads/2015/12/Munguia.jpg" alt="Juan-Álvaro-Munguía" width="599" height="799" /> Juan Álvaro Munguía[/caption]
<h2>Creating a network</h2>
By the mid-eighties, Accion had entered a new evolutionary stage of growth, with a new hypothesis to corroborate: a network in which participating organizations share ideas and experiences and maintain working relationships is mutually beneficial to members and promotes progress in the field of microfinance.

Cathy Quense was Accion’s chief financial and administrative officer during Steve’s tenure at Accion. “Steve had a good sense for people. He could kind of spot somebody who really had the passion and the ability to relate to Accion’s mission and vision and run with it in the field. He was a real mentor to these people and a wonderful trainer. And for us in Boston, he was the connection with the field – the staff and the institutions that later became part of the [Accion] network.”

One of those people was Carlos Herrera, executive director of Guatemalan microfinance institution Génesis Empresarial. He met Steve in 1990 when Steve went to Guatemala to deliver one of his management and communication courses. “When I first met Steve he said he worked at Accion but lived on American Airlines. He was incredibly charismatic. He taught us how to work together as a team, with exercises where the CEO had to clean the bathrooms and the janitor had to book a meeting. His classes were transformational to our staff.”

Largely based on Steve’s principles, Génesis staff gather yearly to participate in what they call their Taller de Siembra y Cosecha (sowing and harvesting workshop) – an annual two-day retreat to evaluate the past year’s results, plan for the future, and engage in team-building exercises.

By 1984, the Accion programs had evolved into a network to promote financial inclusion, social entrepreneurship, and the self-sustaining model of microfinance. Génesis is among the 26 members that currently participate in the network’s yearly meetings, provide statistical and impact data on an ongoing basis, and submit project updates and lessons learned to be shared in the network’s newsletter – which Steve named Micronoticias.

<img class="aligncenter size-large wp-image-450" src="http://blogs.accion.org/wp-content/uploads/2015/12/Steve-Gross-Accion-microfinance-horses-1024x814.jpg" alt="Steve-Gross-Accion-microfinance-horses" width="1024" height="814" />
<h2>What makes life make sense</h2>
After retiring from Accion in 1999, Steve explored volunteer opportunities and found a calling in hospice care. For the past 12 years he has been working part-time, first as a volunteer and then as a chaplain with those who have terminal diagnoses and less than six months to live.

A clear line of service runs through Steve’s life.

“What I became clear on,” Steve explains, “was the fact that everybody in their growth and development has to, eventually, as they mature, become aware of the question, and interested in finding the answer to: ‘What, for me, makes life make sense?’ Service is, for me, the answer to that question. What fills my cup is serving others, because when I serve others in small ways, big ways, in any way, I’m serving my own needs. It’s all one and the same. It’s one act. It’s one attitude. It’s one way of looking at life.”

Steve Gross: The missionary of microfinance

Just after lunch on a recent afternoon in Piñipampa, a rural village 22 miles outside of Cusco, Peru, Fausta Challco joins me as I enter the home of an artisan tile maker. She’s wearing a uniform: leather shoes, skirt, sweater, and jacket. She shakes my hand and introduces herself, panting, her brow glistening with sweat despite the crisp mountain breeze. She then turns to the tile maker and his wife and says something in Quechua. They pull up a few chairs and invite me to sit down. I’m here to interview clients of Accion microfinance partner <a href="http://www.credinka.com/" target="_blank" rel="noopener noreferrer">Credinka</a> and learn about their experience using formal financial services. Fausta is a savings promoter who will take me to meet a few clients in the afternoon. When we finish the conversation and get back in our car, I ask Fausta how she got into this line of business.

She looks at me straight in the eye and answers: “Disobedience.”

As we drive up a bumpy dirt road on the side of a hill, we leave behind a cluster of houses, their terra-cotta tile roofs ablaze in the afternoon sun. Fausta points out the car window and says, “I’m 46 and this is where I’ve spent my whole life. Almost every family here makes a living producing tiles. And that’s what my husband and I did until a few years ago, when I became a Credinka employee.”

“Doña Fausta,” her colleague says, tapping her shoulder, “tell him how you went from Credinka client to Credinka employee.”

She holds onto the front seat as the car jostles over a pothole. “All right,” she says. “We have some time.”

Her trajectory starts in November of 2005, with the arrival in Piñipampa of a man who invited Fausta to a “cup of milk” meeting — a meeting of mothers at teatime — to discuss family finances and the importance of savings. The man was a representative of the Cusco-Puno Corridor, a government-run, $30 million (USD) project funded primarily by the International Fund for Agricultural Development, with the objective of raising the incomes of the rural poor in the main road network between the cities of Cusco and Puno. A specific goal of the project was to promote savings among rural women. This took the form of incentives for opening and maintaining personal accounts at formal financial institutions in the region (Credinka in Cusco and Caja Los Andes in Puno).
<h2>Learning about savings</h2>
Fausta attended the meeting and was asked to gather a group of mothers who would commit to taking financial education classes and then opening savings accounts. When Fausta went home after that meeting, she told her husband all about the project. She was excited by the idea of learning money management skills and financial planning. She wanted to save to purchase a car. She had dreams. But he was dismissive, claiming that those meetings were scams to take people’s money. He cited the example of a bank that had gone bankrupt in the ’90s and in the process had taken away people’s money. “Plus,” he said, “those town gatherings are a breeding ground for gossip.”

Fausta pushed back. She had learned that banks were required to carry deposit insurance, so her money would be safe even if the institution went under. He did not budge. “You can go ahead,” she recounts him saying, “but if you lose the money, you’ll have to find a way to pay us back.”

<img class="aligncenter size-full wp-image-357" src="http://blogs.accion.org/wp-content/uploads/2015/01/Fausta-village-savings-promoter-for-Credinka-Accion-partner-in-Peru.jpeg" alt="Fausta-village-savings-promoter-for-Credinka-Accion-partner-in-Peru" width="800" height="533" />

Within a few days, Fausta mobilized 35 women to form a savings group. In the end, only 22 participated, many discouraged by husbands who were either jealous or skeptical about the project.

Public mistrust of banks is widespread in Peru and across Latin America, whose unstable economies have had disastrous consequences for the financial systems over the past few decades, often causing great damage to people’s financial situations.

Like many Peruvians, Fausta remembers September 6, 1988, with a mix of disbelief and sadness. On that day, at the height of an economic crisis, Economy Minister Abel Salinas addressed the nation to announce a tough anti-inflation program that doubled basic food prices and devalued the national currency. The package went into effect immediately after Salinas’s announcement. That month’s inflation rate reached 114 percent. By year-end, it soared to more than 1,000 percent. Fausta’s mother, who kept her savings inside corn sacks and under her mattress, lost everything. In a matter of days, if not hours, her hard-earned money was as good as nothing.

So when Fausta was presented with the opportunity to learn about financial education and the promise of safe savings, her heart leaped. She wasn’t going to let her husband stop her. A few short weeks after that first “cup of milk” meeting, Fausta and the 22 women formed a group and she was elected group leader. She attended the meetings religiously — often rushing to complete all of her chores and helping her husband with their tile-making activities in order to assuage his discontent with her involvement.

“Working with the group gave me confidence,” Fausta explains. “I learned to administer money and not always rely on my husband’s pocket.”

Part of her role as leader was to collect each member’s monthly contributions and travel to Credinka’s branch in Cusco to make the deposits. “I would take two buses to reach the bank, fill out slips, wait in line, and talk to the teller. It occurred to me that many of the women in my group had never seen the inside of a bank. From then on, I started bringing them every month, one by one, and showing them how to do the transactions by themselves.”

<img class="aligncenter size-full wp-image-358" src="http://blogs.accion.org/wp-content/uploads/2015/01/Fausta-and-client-portrait-of-savings-promoter-for-Credinka-Accion-partner-in-Peru.jpeg" alt="Fausta-and-client-portrait-of-savings-promoter-for-Credinka-Accion-partner-in-Peru" width="800" height="533" />
<h2>This money is mine</h2>
But after saving for several months, Fausta realized that her balance remained very small. “At the time I wanted to buy a car,” she says. “The interest I earned was barely enough to buy a loaf of bread.”

So she decided to put her money into a fixed-rate savings account for six months. She told her husband that she wanted to pool her cash with his in order to earn a higher return, but he said no. She did it anyway.

“I took the money he had at home and hopped on the bus to Cusco. When I got to the bank, I hesitated. I couldn’t believe I had just disobeyed my husband. It was already bad enough that I’d been participating in these meetings against his will, but now I might be crossing the line. But I thought and thought and then stepped into the bank and did it.”

At this point, Fausta’s eyes widen. She covers her mouth. “I was so terrified that he would find out. Every month that went by I felt a little more relieved, but I always feared, what if he asked me about his money?”

At the end of the six months, Fausta invited her husband to go to Cusco on a date. When they got there, she asked him to make a quick stop by the bank.

“What are we doing here?” he asked. “Just give me a few minutes,” she answered. “I want to show you something.” She withdrew the balance on the savings account and divided it into three piles: his initial sum, hers, and the interest earnings. “This money is yours,” she said, handing him back his original amount. “This money is mine,” she added, pointing to her initial contribution. Then, she pointed at the interest pile and said, “And this money is mine, too.”

<img class="aligncenter wp-image-360 size-large" src="http://blogs.accion.org/wp-content/uploads/2015/01/Fausta-savings-promoter-and-client-in-rural-Peru-Credinka-Accion-partner-1024x683.jpeg" alt="Fausta-savings-promoter-and-client-in-rural-Peru-Credinka-Accion-partner" width="1024" height="683" />
<h2>No Faustian bargain</h2>
Unlike the medieval legend of Faust, who makes a contract with the devil in return for worldly gains, Fausta’s goals were much humbler: she wanted to improve her life and those of her children. And she thought that prudent financial management, combined with hard work and savings, could get her family there. Her husband had been a heavy drinker and sometimes was not around to help with some of the hardest tasks of their tile-making business, such as when a delivery of firewood arrived once and she had to unload the whole truck by herself. If she could purchase a vehicle, she thought, their business and quality of life would improve.

In the few years since forming that first savings group, Fausta continued to enroll women from her village and from surrounding ones into the Cusco-Puno Corridor savings project.

By 2008, Fausta heard that the project was coming to an end. She contacted the government representative who had recruited her years earlier to tell him how much she had enjoyed the experience and how important she thought that projects like these remained active.

He asked her for a phone number and told her to give him a couple of days. Eventually, she received a call from someone at Credinka inviting her to a meeting in Cusco. When she arrived at the meeting, she was presented with an employment contract.

“I thought I was going to be offered a loan to buy a car,” she says. “Never did I imagine that I would be offered a job. I got so nervous I didn’t know what to do, so I didn’t sign the contract.”

Instead, she went home and told her husband, who, to Fausta’s surprise, encouraged her to accept the offer. “Don’t be silly,” he said. “You like this so much and have put so much effort into it. Just take the job.”

So she did. “I was so proud of being offered a job,” she says. “I felt so important.”
<h2>From client to employee</h2>
Marina Orccohuarancca is Credinka’s head of microcredit and microsaving products, and Fausta’s boss. “Fausta was one of six women we hired in 2009 to raise awareness and teach rural women about the formal financial system. Until then, only small NGOs did this kind of work. It was the first time a formal, regulated financial institution reached out to this segment of the population.”

That was the case in part because those populations are geographically and culturally isolated. “Until 2002, only the security guards spoke Quechua,” Marina says. “Now, about 60 percent of the branch staff in rural areas speak Quechua.”

Credinka currently has a team of 14 women doing this work in a region that has expanded well beyond Cusco-Puno to include several more provinces in the southwestern part of the country, where development projects such as the Cusco-Puno Corridor had never reached.

<img class="aligncenter wp-image-361 size-large" src="http://blogs.accion.org/wp-content/uploads/2015/01/Fausta-savings-promoter-for-Credinka-Accion-partner-in-Peru-1024x683.jpeg" alt="Fausta-savings-promoter-for-Credinka-Accion-partner-in-Peru" width="1024" height="683" />

Not too long after accepting the job, Fausta took a loan from her employer and purchased a truck. Her husband uses it to provide transportation services among the surrounding villages. They’ve also opened a minimarket. Their tile business is still going strong. They have even hired employees to manage production, so Fausta’s husband no longer needs to spend so many hours doing the heavy work. He now does sales and deliveries.

Fausta has flourished at Credinka. Among a long list of accomplishments, was representing Credinka at a financial innovations competition in Lima and winning. The victory was memorable because she had helped the bank improve the savings product that earned the prize; it was also her first time on an airplane. The award consisted of a vacation for two anywhere in Peru. She chose the coastal town of Trujillo and took her husband there. It was their first vacation as a couple, and his first time on an airplane too. On that trip, Fausta’s husband apologized for not having been good to her. He also thanked her for changing his life. By then, he had stopped drinking.

She has since represented Credinka on a number of projects across Peru and even in Paraguay, where she was invited to speak about the financial education work being done with rural populations in her country.

In a <a href="https://www.youtube.com/watch?v=0RNRzdSM8go" target="_blank" rel="noopener noreferrer">YouTube video posted by the Peruvian Ministry of Development and Social Inclusion</a>, Fausta’s story of success is used to illustrate the impact of the Cusco-Puno Corridor project. In the clip, Fausta is shown making tiles with her husband, tending their store, and teaching a group of women about the banking system. They gather in the common area among a few houses, sitting on wooden chairs as Fausta lectures them, pointing to a few laminated sheets hanging from a clothesline. The image is a stark difference from the idea of a formal lesson most of us would associate with education. But given the realities of rural communities like Piñipampa — which is so similar to other villages throughout the developing world — such rudimentary methods hold the promise of making an immense difference in the lives of people who would otherwise have no chance at economic opportunity.

By the end of the project in 2008, more than 7,400 women had opened savings accounts – an extraordinary number, considering the initial goal of just 2,000. Today, Fausta not only continues to mobilize women in rural villages in the area, but she also conducts financial-skills training classes, including how to open and maintain accounts and about savings, compounding interests, financial planning, how to interpret bank statements, and more. Her three children have gone to college.

“All the sacrifices I made,” she tells me as we arrive at the next client’s house, “were validated for me when my children once said, ‘Mom, if you’ve made it this far, we’re going to have to do better than you.’”

Disobedience and savings: How one woman changed an entire village in Peru

The weather app on my phone reads 40 degrees Celsius (104°F) when we arrive in Concepcion, a four-hour drive north of Asuncion, Paraguay’s capital. If Paraguay is “the heart of South America” — as locals refer to their country — we’re now standing somewhere in the left atrium. Crammed in Lilian Britez’s modest home, we wait as she manages her way onto a shiny blue wheelchair. Her crisp clothes, light makeup, and styled hair indicate that she’s prepared for our meeting. We cross the dirt road that divides her home from a small church and gather under the shadow of a large poplar to hear her story.

Now 45, Lilian became paraplegic at 16 when a stray bullet struck her spine. In spite of that, she lives an independent life, selling Avon products and, most recently, producing decorative flowers. She learned this new skill after joining a solidarity group of Fundación Paraguaya with 19 women in her community. This model, which Fundación Paraguaya calls <em>comité de mujeres emprendedoras</em> (committee of entrepreneurial women), allows women to acquire new skills, such as handicrafts and soap making, and get microloans to support or start new microenterprises.

Though she enjoys the extra income that’s resulted from her involvement with the Paraguayan nonprofit, Lilian has much higher aspirations: She wants to help bring electricity to families in her community. And she’s poised to do that through a partnership facilitated by Accion between <a href="http://www.fundacionparaguaya.org.py/?lang=en" target="_blank" rel="noopener noreferrer">Fundación Paraguaya</a> and <a href="http://www.barefootcollege.org/" target="_blank" rel="noopener noreferrer">Barefoot College</a>.
<h2>A barefoot movement</h2>
Founded by Indian social activist Bunker Roy in 1972, Barefoot College provides basic services and solutions to problems in rural communities, with the objective of making those communities self-sufficient. The organization focuses on five areas: the delivery of solar electrification, clean water, education, livelihood development, and activism. With a geographic focus on the least developed countries — including Paraguay — Barefoot College believes in empowering women as agents of sustainable change. In a TED talk filmed in 2011, Roy asks, “Who is a professional?” He then explains: “A professional is someone who has a combination of competence, confidence, and belief. A water diviner is a professional. A traditional midwife is a professional. A traditional bonesetter is a professional. These are professionals all over the world. You find them in any inaccessible village around the world. And we thought that these people should come into the mainstream and show that the knowledge and skills that they have are universal.”

Roy realized this decades ago, and over the last 40 years has been enabling the rural poor to use their creativity and intellect to solve some of the most intractable problems of their daily lives. Funded by the Indian government, philanthropic contributions, and revenue generated from the sales of products it produces, Barefoot College has improved the lives of thousands of adults and children through its myriad initiatives. The solar engineering program, launched in 2008, has trained more than 1,100 women from 64 countries. The result? More than 50,000 homes electrified – and counting.

Today, Barefoot College is going a step further and selecting women with disabilities to participate in its solar-engineering program. Surrounded by a crowd of family and friends, Lilian introduces herself to everyone under the tree: Fundación Paraguaya staff, Accion visitors, and Barefoot College’s Latin America director Rodrigo París, who flew in from his office in Colombia for the selection of Paraguayan candidates. Rodrigo describes the program: Lilian will travel to the village of Tilonia, India, at no cost to her to attend a five-month, six-days-a-week electrical skills training program with 50 other women from all over the world. She will live, eat, and learn with them for the duration of the course. There are no language requirements or academic prerequisites. Classes are taught in English with pictorial materials and lots of sign and body language. Rest assured, he says, she will be able to follow along. She will learn how to bring light to a house powered by solar panels. Though she won’t receive a college diploma, at the end of the program she’ll be considered a solar engineer. All Lilian needs now

Surrounded by a crowd of family and friends, Lilian introduces herself to everyone under the tree: Fundación Paraguaya staff, Accion visitors, and Barefoot College’s Latin America director Rodrigo París, who flew in from his office in Colombia for the selection of Paraguayan candidates.

Rodrigo describes the program: Lilian will travel to the village of Tilonia, India, at no cost to her to attend a five-month, six-days-a-week electrical skills training program with 50 other women from all over the world. She will live, eat, and learn with them for the duration of the course. There are no language requirements or academic prerequisites. Classes are taught in English with pictorial materials and lots of sign and body language. Rest assured, he says, she will be able to follow along. She will learn how to bring light to a house powered by solar panels. Though she won’t receive a college diploma, at the end of the program she’ll be considered a solar engineer.

All Lilian needs now is interest, and to be committed to completing the course and coming back to Concepcion to deliver solar power to her community. Upon her return, Fundación Paraguaya will help Lilian conduct a needs assessment to select the homes to be electrified using its “<a href="http://www.accion.org/poverty-stoplight-fundacion-paraguaya-putting-poverty-on-the-map/" target="_blank" rel="noopener noreferrer">Poverty Stoplight</a>”, a 50-question visual survey instrument to measure poverty. One of the measurements includes access to electricity.

Then, Barefoot College will support Fundación Paraguaya in identifying donor funding for the purchase of the solar panels. A volunteer committee made up of community members will help manage the installation of the panels and provide ongoing maintenance for the newly electrified homes – an electrical company of sorts – under Lilian’s guidance and supervision. Each home will pay four to six dollars per month. The committee will establish the exact amount in consultation with community members, and 60 percent of the income will go into a savings account to purchase new solar panels (the lifespan of a typical panel is five years), with 40 percent for Lilian’s salary.

After Rodrigo’s comprehensive explanation, Lilian sits up on her chair and, with a meek look, says: “I feel healthy and motivated. I’m excited to travel to India and come back with knowledge that will benefit more than just me.”

[caption id="attachment_335" align="aligncenter" width="1382"]<img class="wp-image-335 size-full" src="http://blogs.accion.org/wp-content/uploads/2015/12/disability-inclusion-rodrigo-with-Lilian-Juliana-Britez-accion-barefoot-college-fundacion-paraguaya-solar-power-rural-paraguay.jpg" alt="disability-inclusion-rodrigo-with-Lilian-Juliana-Britez-accion-barefoot-college-fundacion-paraguaya-solar-power-rural-paraguay" width="1382" height="922" /> “Ideas conceived from a desk are usually poor. Ideas conceived in the field are often great.” Rodrigo Paris (left), Latin America Director, Barefoot College.[/caption]
<h2>Making the solar engineer</h2>
On April 10, 2014, Lilian boarded a plane for the first time in her life, bound for India. She and the two other Paraguayan women selected for the program had embarked on an experience that would forever change the course of their — and arguably other people’s — lives.

I caught up with her on the phone in late September, when she was back in Paraguay.

“How was India?” I asked.

“So many people,” she said. “So many strangers, everyone speaking languages I couldn’t understand. And the food was so hot! I survived on rice pudding and fruit.”

“And the college?”

“At first it was very hard. Nobody spoke Spanish, and we didn’t understand much. One day we cried. They spoke English and Hindi and the students spoke our languages. A lot of us broke into tears. But, eventually we learned to communicate and we became very close with each other. By the end of the semester, we were crying again, this time because of having to say goodbye.”

Classes ran from nine to five, with a one-hour break for lunch. Lilian learned the basic principles of electricity. She learned how to mount all the components of a solar panel, including soldering circuit boards, connecting inverters, testing, and the entire process of how to make a solar lantern.

Portable solar lanterns are an important part of electrifying a rural village. Think about their many uses: for fishing or farming before dawn, fetching water after dusk, tending to a sick animal through the night, gathering with family outside in the evenings.

The classroom had 10 teachers, mostly women, who spent time one on one with the students. Students were also encouraged to assist each other, which was especially important for Lilian as she had to ask for help in negotiating the campus’s sandy pathways, where her wheelchair would often sink.

There were extracurricular activities and road trips — including a few days in Agra, where Lilian visited the Taj Mahal. In July, former president Clinton visited Barefoot College and met with the class of solar engineers.

“That handsome blond with the great blue eyes,” Lilian said about meeting Clinton. “I remember seeing him on television in Paraguay.”

That day, she also had a chance to meet Paraguay’s ambassador to India. “I asked to have a word with him,” she continued. “I told him this program is fantastic and that he needed to make sure more Paraguayan women have a chance to attend.”
<h2>Disability inclusion</h2>
Two years ago, Fundación Paraguaya began working on financial inclusion for persons with disabilities (PWDs), a population vastly underrepresented and underserved by microfinance institutions. According to the World Health Organization, PWDs represent 15 percent of the world’s population, but some estimates indicate that they make up less than one percent of the world’s current microfinance clients. With Accion’s support, Fundación Paraguaya partnered with Nobel Peace Prize-winning Handicap International to take the first steps in becoming a fully accessible institution. Handicap International developed staff training and awareness-raising tools for Fundación Paraguaya. In addition, Accion supported Fundación Paraguaya in executing an initial assessment of physical accessibility (with Libre Acceso from Mexico) and analyzing how to use technology to facilitate disability access to financial and non-financial products.

“We had already been working for a number of years on the distribution of wheelchairs in partnership with the Wheelchair Foundation and the Mormon Church,” says Jimena Vallejos, project manager for disability inclusion at Fundación Paraguaya, “so working with Accion and Handicap International on a broader disability-inclusion initiative was a natural course of action.”

The partnership yielded another positive result: In January 2014, the Center for Financial Inclusion at Accion published a framework for microfinance institutions seeking to close the financial inclusion gap for PWDs. The reference publication, to which Fundación Paraguaya made significant contributions, covers six areas and includes implementation details to help financial institutions become more welcoming to PWDs. Fundación Paraguaya is implementing this framework.

This past June, Fundación Paraguaya received a grant from the United States Agency for International Development to develop a disability-inclusive program and business model for microfinance institutions — to show that serving PWDs is not only the right thing to do but also profitable. The grant will also support the implementation of the Roadmap to Financial Inclusion and Fundación Paraguaya’s Poverty Stoplight program among families who have members with disabilities.

“When Accion connected us with Barefoot College and suggested we select women with disabilities for the solar engineering program, we jumped at the idea,” says Jimena. “It’s been amazing to see the change in these women. The women that came through Asuncion en route to India six months ago were different. They were slightly frightened and a bit insecure. They returned from India empowered — excited to start their [solar] projects. The change is wonderful. And we are hoping to send another group next year, if Barefoot College will have us.”
<h2>Illuminating the future</h2>
But what happens after a solar engineer brings light to her village, her mini-“electric company” is underway, and Barefoot College has stepped aside?

“When we select a community for the program,” explains Rodrigo París, “we establish alliances with local universities to conduct impact assessments in the villages. We want to know what changed with the arrival of light at the family, community, and business levels.”

The results from these studies are used to suggest community improvements, such as building a library for children learning to read, or a workshop space for women to exchange handicraft skills.

Barefoot College’s five-year vision for Latin America is to build a campus in the region — as they have done in Sierra Leone and Zanzibar and will soon do in South Sudan — to train 100 to 200 women per semester rather than the two or three from each country who travel to India currently.

Rodrigo also wants to establish the first network of solar-engineer alumni in Latin America to foster communication, idea-exchange, and problem-solving.

But all of that needs financial support.

“Ideas conceived from a desk are usually poor,” says Rodrigo. “Ideas conceived in the field are often great. Come visit Barefoot College. Once you see the magic, once you meet these courageous women, you will want to support us.”

“Ultimately,” he continues, “what we are trying to do is to strengthen, educate, and empower women, and through them — because they are the core of a family and a community — to bring light. And the light will light ideas, give hope, and foster positive change.”

Disability inclusion and solar power in rural Paraguay

How we can use data to not only analyze poverty but work toward eliminating it

Curuguaty is a Paraguayan town in the eastern department of Canindeyú. If you’ve heard of it – which you almost certainly haven’t – it’s probably because its population, which is poor and mostly rural, has been surveyed and plotted on a map using Accion partner <a class="markup--anchor markup--p-anchor" href="http://www.fundacionparaguaya.org.py/" target="_blank" rel="follow noopener noreferrer">Fundación Paraguaya</a>’s color-coded ‘Poverty Stoplight,’ an innovative poverty measurement tool that has helped over 18,000 families overcome economic poverty since the program began in 2010.
<p id="a392" class="graf--p graf-after--p">Fundación Paraguaya is a nonprofit social enterprise in Paraguay that is focused on using microfinance, education, and more innovative methods (including this Poverty Stoplight) to eliminate poverty in the country.</p>
<p id="6c72" class="graf--p graf-after--p">The Poverty Stoplight operates on the notion that, in order to truly make a difference in eliminating poverty, you have to first understand it. Fundación Paraguaya founder Martín Burt realized that every poor client he served was poor in his or her own way. The tricky part was to understand the ways in which each family is poor, define what it means for these individuals or families to be not poor, quantify all of that, qualify it, and then come up with an exit strategy.</p>
<p id="7130" class="graf--p graf-after--p">Burt and his team organized 50 poverty indicators, such as jobs and access to water, into six dimensions:</p>
<p id="53ef" class="graf--p graf-after--p">1) Income and employment
2) Health and environment
3) Housing and infrastructure
4) Education and culture
5) Organization and participation
6) Interiority and motivation</p>

<div class="section-inner u-sizeFullWidth">
<figure id="315b" class="graf--figure graf--layoutFillWidth graf-after--p">
<div class="aspectRatioPlaceholder is-locked">
<div class="progressiveMedia js-progressiveMedia graf-image is-canvasLoaded is-imageLoaded"><img class="alignnone wp-image-284 size-large" src="http://blogs.accion.org/wp-content/uploads/2015/12/Poverty-stoplight-fundacion-paraguaya-accion-blog-Cristina-Rios_Pacheco-client-loan-officer-Luque-Paraguay-1024x683.jpeg" alt="Poverty-Stoplight-fundacion-paraguaya-accion-blog-Cristina-Rios_Pacheco-client-loan-officer-Luque-Paraguay" width="1024" height="683" /></div>
</div>
<figcaption class="imageCaption"><em>Cristina Ríos Pacheco takes Fundación Paraguaya’s Poverty Stoplight survey with her loan officer in Luque, Paraguay</em></figcaption></figure>
</div>
<div class="section-inner layoutSingleColumn">
<p id="becb" class="graf--p graf-after--figure">They also identified three conditions for each poverty indicator (not poor, poor and extremely poor), and assigned to each the corresponding colors — green, yellow and red. A photograph was included to represent each condition in the local context, since many of those surveyed were functionally illiterate. For example, to represent the three possible conditions for access to water, the survey respondent could look at a picture of a woman carrying a bucket of water on her head (extremely poor), a well outside her house (poor) and a faucet at home (not poor), and quickly identify which photograph best represented the family’s situation.</p>
<p id="4d83" class="graf--p graf-after--p">Burt explains that the approach of his Poverty Stoplight incorporates the following four propositions:</p>

<ul>
 	<li id="d26b" class="graf--p graf-after--p"><strong class="markup--strong markup--p-strong">First, poverty has many more dimensions than insufficient income.</strong></li>
 	<li id="5866" class="graf--p graf-after--p"><strong class="markup--strong markup--p-strong">Second, poverty doesn’t affect families uniformly; each family has a different set of poverty-related problems to resolve in order to overcome poverty.</strong></li>
 	<li id="ef7e" class="graf--p graf-after--p"><strong class="markup--strong markup--p-strong">Third, the main protagonists in eliminating poverty must be the poor themselves. Institutions, however far-sighted or well-funded, do not have sufficient insight into the poverty-related problems of individual families or sufficient resources to permanently eliminate poverty on their behalf.</strong></li>
 	<li id="7d4b" class="graf--p graf-after--p"><strong class="markup--strong markup--p-strong">Fourth, a poverty-elimination strategy must be scalable, which means that it must cost very little to implement and, ultimately, must be financially self-sustaining.</strong></li>
</ul>
<p id="c59c" class="graf--p graf-after--p">After completing the 20-minute, 50-question pictorial survey on a touch-screen device (developed pro bono by Hewlett-Packard), clients receive a one-page report that summarizes in ‘heat map’ fashion the areas in which the family is extremely poor (red), poor (yellow) and not poor (green).</p>

</div>
<div class="section-inner u-sizeFullWidth">
<figure id="17dd" class="graf--figure graf--layoutFillWidth graf-after--p">
<div class="aspectRatioPlaceholder is-locked">
<div class="progressiveMedia js-progressiveMedia graf-image is-canvasLoaded is-imageLoaded"><img class="progressiveMedia-image js-progressiveMedia-image alignnone" src="https://cdn-images-1.medium.com/max/2000/1*YxMHdcn5JpOLC9mum4syrQ.jpeg" alt="Poverty-Stoplight-fundacion-paraguaya-accion-blog-cell-phones-paraguay" width="1221" height="381" /></div>
</div></figure>
</div>
<div class="section-inner layoutSingleColumn">
<p id="78d6" class="graf--p graf-after--figure">Fundación Paraguaya’s staff then works with the client’s family to develop a specialized package of services to address their specific poverty-related problems. Typically, the first task is to help the client develop a business plan to increase per-capita income above the national poverty line ($3.5 per day per member of a household in Paraguay). That might include a microloan for another family member or the option to become a microfranchise by selling certain products, such as reading glasses and over-the-counter pharmaceutical products, which Fundación Paraguaya is working to turn into client microfranchise opportunities.</p>
<p id="d14b" class="graf--p graf-after--p">The data from the survey also provides the baseline against which to measure each client’s progress in overcoming poverty. Finally, the data are geo-referenced on a Google map and made available to NGOs and government agencies to implement interventions such as vaccination events, blood pressure screenings, or getting a free wheelchair to a person in need.</p>
<p id="b8ee" class="graf--p graf-after--p">This level of coordination happened in Curuguaty.</p>
<img class="progressiveMedia-image js-progressiveMedia-image alignnone" src="https://cdn-images-1.medium.com/max/2000/1*22an4cpaFE-gUqHCNFarBA.png" alt="Poverty-Stoplight-fundacion-paraguaya-accion-blog-map-paraguay" width="1453" height="666" /><em>A screengrab of the Poverty Stoplight map developed by Fundación Paraguaya.</em>

</div>
<div class="section-inner layoutSingleColumn">
<h2 id="e810" class="graf--h4 graf-after--figure">Putting Curuguaty on the map</h2>
<p id="6b41" class="graf--p graf-after--h4">Tablets in hand, Fundación Paraguaya staff canvassed the outskirts of Curuguaty to administer the Poverty Stoplight to hundreds of residents. One of them was Benita Chaparro, who, along with her husband, was supporting their 13-year-old son on her small income as a housekeeper. Benita is a member of one of Fundación Paraguaya’s 2,600 all-women solidarity groups participating in a program called ‘Mujeres Emprendedoras’ (Entrepreneurial Women). The groups access small loans from Fundación Paraguaya and learn business and entrepreneurial skills such as self-management, budgeting, and leadership using <a href="https://www.juniorachievement.org" target="_blank" rel="noopener noreferrer">Junior Achievement’s model</a>.</p>

<figure id="1485" class="graf--figure graf--layoutInsetLeft graf-after--p">
<div class="aspectRatioPlaceholder is-locked"></div>
<figcaption class="imageCaption"><em><img class="wp-image-283 size-full alignnone" src="http://blogs.accion.org/wp-content/uploads/2015/12/Poverty-stoplight-fundacion-paraguaya-accion-blog-Benita-Chappara.jpeg" alt="Poverty-Stoplight-fundacion-paraguaya-accion-blog-Benita-Chaparro" width="640" height="480" />
Benita Chaparro, client of Fundación Paraguaya, procured a stove, a sink, and running water as a result of the Poverty Stoplight program.</em></figcaption></figure>
<p id="cc1c" class="graf--p graf-after--figure">When Benita took the survey in 2012, she fared poorly on indicators related to safe cooking and trash disposal, earning yellow and red respectively in those categories. She prepared meals using firewood in a pit and burned their trash in her yard. Fundación Paraguaya staff asked why that was the case and realized that part of the reason had to do with lack of motivation and insufficient knowledge about health hazards. They worked with her on that, eventually convincing Benita’s husband to use his construction skills to build an elevated stove. That was only the beginning.</p>
<p id="8ecc" class="graf--p graf-after--p">Today, Benita has a kitchen with a stove, a sink, and running water. “These changes have lifted my spirit,” she says. “When I go to bed I think about this accomplishment and feel happier and more rested because of the comfort these things have given me.” The family plans to put in cement floors and build a laundry room. Not only has Benita’s family moved from red and yellow to green on most of their indicators, but their achievements have helped motivate other women in her solidarity group. “It’s important to have goals,” she explains. “At first the work seemed daunting, but then we got motivated and now it’s a reality.”</p>
<p id="3514" class="graf--p graf-after--p">In 2011, Fundación Paraguaya’s Poverty Stoplight helped 6,400 families like Benita’s (an estimated 32,000 people) raise their income above the national poverty line. In 2012, they helped an additional 6,000, while enabling 600 of the 6,400 families from 2011 to transform all the indicators in their report from red or yellow to green, indicating that they had overcome poverty in all its dimensions. During 2013, 6,160 families overcame poverty with respect to income (totaling 18,590 families for the period 2011–2013) and 1,057 overcame poverty with respect to all 50 of Fundación Paraguaya’s indicators (totaling 1,662 families for the period 2012–2013.)</p>
<p id="bab3" class="graf--p graf--startsWithDoubleQuote graf-after--p">“If 92,000 people have been lifted out of poverty by their own efforts,” writes Burt, “how much more can be accomplished if society as a whole makes a concerted effort?”</p>

<h2 id="9489" class="graf--h4 graf-after--p">Yes, Mr. President</h2>
<p id="dd90" class="graf--p graf-after--h4">Luis Fernando Sanabria took over Fundación Paraguaya in 2012, after Burt was invited by President Federico Franco to join his cabinet as chief of staff. Burt is no stranger to public service — he spent a term as mayor of Paraguay’s capital, Asunción. He stepped down from Fundación Paraguaya to serve his country. He would eventually find a way of raising the Stoplight to the highest levels of government.</p>
<p id="d5a7" class="graf--p graf--startsWithDoubleQuote graf-after--p">“Before the adoption of the Stoplight,” says Sanabria, “Fundación Paraguaya was the smallest microfinance organization in Paraguay, with 9,000 clients. Since we’ve changed our focus, we’ve grown to 57,000 clients.”</p>
<p id="210d" class="graf--p graf-after--p">In December 2012, Paraguay’s national government launched its Private-Public Partnership Action Plan to Eliminate Extreme Poverty by 2018. Burt’s Stoplight became a major component of the policy. It was used to design a strategy to map 1.2 million people living in extreme poverty in 400 rural villages, 1,000 urban slums, and 116 indigenous settlements. The Stoplight also provided a methodology that enabled more than 1,500 local businesses to sponsor one extremely poor village or settlement in their community, thereby becoming the designated liaisons between government agencies that provide services and the community represented by each business.</p>

<h2 id="7ee2" class="graf--h4 graf-after--p">Beyond Paraguay</h2>
<p id="06a9" class="graf--p graf-after--h4">Burt wants more. “The truth is that, just like David against Goliath, we want to demonstrate to the microfinance industry that [the Stoplight] is a platform that needs to be used for the eradication of poverty at an international level.”</p>
<p id="1cb6" class="graf--p graf-after--p">And he’s working on it. Burt has partnered with ProMujer and the BBVA Foundation to help bring his Stoplight to Mexico. Organizations in Nigeria, Tanzania, and Uganda are asking Burt to localize his Stoplight in their respective countries. (He’s looking for financial support for that.)</p>
<p id="b7ed" class="graf--p graf--startsWithDoubleQuote graf-after--p">“Our objective is to transcend what we’ve done so far, which is fighting and alleviating poverty, to eliminating it. We want to go from financial inclusion to poverty eradication.”</p>
<p id="da63" class="graf--p graf-after--p">Burt is leading by example. The question is, what will it take to get others to follow suit?</p>

</div>

The Poverty Stoplight: Putting poverty on the map

<div class="byline">One of the first things you might notice when you arrive in Yangon, Myanmar are the painted faces of countless women and girls, or the men wearing skirts, or brown smiles colored by the constant chewing of betel nut.</div>
You might also notice the heat, the dense traffic, and the stray dogs. Or you might not. But one thing you certainly won’t miss is the booming development throughout the city. From the airport under construction to the ditches alongside widening boulevards and the cranes hovering above soon-to-be skyscrapers, you understand that Myanmar is a country in rapid transition.

But driving through the streets of Yangon, you quickly realize that the promise of development belies the realities of life for the citizens of one of Southeast Asia’s poorest countries. More than a quarter of its 51 million people live in poverty. Of 187 countries in the <a href="http://hdr.undp.org/sites/default/files/hdr14-report-en-1.pdf" target="_blank" rel="noopener noreferrer">2014 UNDP Human Development Index</a>, Myanmar ranked 150th. The problems extend beyond basic indicators of life expectancy, education, and per capita income: A stark 80 to 90 percent of the population lacks access to formal financial services. In a country that has recently resumed relations with the international community after 50 years of military rule and isolation, economic development cannot come fast enough.

But things are happening. A new government is helping Myanmar rejoin the rest of the world. The authorities have granted licenses to foreign banks, which are racing to open branches across the country. Big corporations are investing. Mobile-phone usage is rocketing, from 1 percent in 2009 to 13 percent in 2014 to an estimated 80 percent by 2016, according to the country’s Ministry of Telecommunications and Information Technology. Accion is playing a modest role in that transformation, channeling new investment and skills to help Myanmar’s small businesses and families save, borrow, and, ultimately, build better lives. New roads and buildings are high profile and important symbols of development; less obvious but perhaps far more critical is access to basic financial services.

Following almost two years of careful research, planning, and negotiations, <a href="http://www.dealstreetasia.com/stories/foreign-microfinance-investors-to-pour-6-85m-into-myanmar-firm-6160/" target="_blank" rel="noopener noreferrer">Accion and partners FMO and Triodos invested</a> in one of the earliest microfinance institutions established in the country: <a href="https://www.dawn.org.mm/">DAWN Microfinance</a>, originally launched in 2002 as a program of <a href="https://myanmar.savethechildren.net/our-consortiums/dawn-microfinance" target="_blank" rel="noopener noreferrer">Save the Children</a>.

Accion staff have assumed key executive and governance positions at Dawn, including that of CEO and seats on the board. The plan is to build upon the team already in place and significantly expand Dawn’s client outreach and its range of products and services. Accion believes that Dawn can serve as a model for the country’s nascent microfinance industry, influencing both the development of the sector and its regulation. Ultimately, the hope is that Accion’s success in Myanmar will inspire other financial inclusion players to invest in the country.
<h2>The daily catch</h2>
Morning in Mawlamyaing is hazy and sweltering, and it smells of fish. The capital city of Mon State, a six-hour drive southeast of Yangon through heavy, single-lane truck and motorcycle traffic, lies at the mouth of the Thanlwin River. Ma San Htwe sells fish at the Maung Ngan Market. She sits on a wooden fruit crate in one of the market’s many walkways. A makeshift counter of wood planks sits between us. Her product rests on display on metal trays, bloody water and silver scales covering every surface – the table, the ground, my shoes. The stench is initially hard to tolerate, but it becomes less noticeable as time passes.

<img class="aligncenter wp-image-295 size-full" src="http://blogs.accion.org/wp-content/uploads/2015/12/Myanmar-Accion-champions-financial-inclusion-fish-seller-Ma-San-Hew-microfinance-client-of-Accion-Dawn-image-by-John-Rae.jpg" alt="Myanmar-Accion-champions-financial-inclusion-fish-seller-Ma-San-Htwe-microfinance-client-of-Accion-Dawn-image-by-John-Rae" width="972" height="651" />

She works while we talk, occasionally chopping fish with a cleaver on a wooden block beside her. She’s 39, has three children, and has been a fishmonger for 20 years. Her daily routine seems exhausting: she rises at 3:00 a.m., takes a horse-drawn carriage to the harbor for 1,000 kyat (about 80 cents), buys the fish, and transports it back to the market, where she sets up and starts selling by 6:00 a.m.

“You have to get there early if you want the best fish,” she says through my Burmese interpreter.

She works until 1:00 p.m. and then goes home to cook, clean, and iron clothes. She goes to bed at 9:00 p.m. Her husband is a carpenter, and only her youngest child is in school. The others dropped out of high school because they were not interested in getting an education.

She wants to open her own fish market one day and buy a fishing boat. She tells me she makes good money — about 20,000 kyat on a good day, or about $16 — but that wasn’t always the case.

Just a little over two years ago, loan officers from Dawn Microfinance came to Maung Ngan, fanning through the maze of tarp-covered walkways and passing out pamphlets to promote microloans. Dawn lends to women only, in solidarity groups – a common practice where borrowers form a group and act as each other’s guarantors. If someone defaults, the group collectively foots the bill. But defaulting is rare in these groups, given that peer encouragement and fear of shame play a big role in clients’ repayment behavior.

Ma San Htwe belongs to a group of 20 women. She has borrowed five times – and her current loan is for $350. She has used her loans to purchase larger quantities of fish in greater variety. She even sells prawns and river lobsters – items I did not see being offered by other fishmongers at the market. Her income has increased, as have her profits, and she’s been able to invest in some gold jewelry in lieu of a formal savings account. Despite her financial success, Ma San Htwe does not have a bank account. She does not have a safe place to keep her money or save her extra income. She does not have a cell phone. She does not keep track of her income and expenses. Her math skills are rudimentary. And her story is virtually that of every other client I spoke to during my time in Myanmar.
<h2>It’s Myanmar’s time</h2>
<img class="aligncenter wp-image-296 size-full" src="http://blogs.accion.org/wp-content/uploads/2015/12/Myanmar-Accion-champions-financial-inclusion-temple-landscape-image-by-John-Rae.jpg" alt="Myanmar-Accion-champions-financial-inclusion-temple-landscape-image-by-John-Rae" width="975" height="648" />

Naming the institution Dawn might be no accident. Microfinance in Myanmar is a fledgling industry. A report from the Consultative Group to Assist the Poor published in 2013 indicated that demand for microfinance in Myanmar exceeds supply by four times and that the banking sector has so far found it commercially challenging to extend financial access to the poor.

Despite the emerging democracy’s considerable growth in the past two years, the need for financial services for poor households remains acute. Today, there are about 150 microfinance institutions operating in the country, although few, if any of scale or positioned to scale. For most Burmese, microfinance institutions represent the only means of accessing affordable credit. Client after client told me that they had never been approached by any microfinance institution other than Dawn. Some had borrowed from loan sharks. I even met a woman who had been a loan shark herself but decided instead to take out a loan from Dawn to start her own food shop and family restaurant.

Clients want more. They want larger loans. They want individual loans. They want training.

Myanmar’s microfinance industry — including Dawn — is making advances and a more favorable regulatory environment is emerging, but the market needs time to mature.

Dawn currently serves more than 54,000 clients with loans ranging from $60 to $500. Its loan portfolio is just about $4.7 million. It employs almost 200 staff members across 16 branches in five states, with plans to add approximately 25 branches over the next three years — both to deepen its impact in currently covered areas and to expand to more remote and underserved areas of Myanmar.

The Accion-led partnership will be instrumental in driving that growth. In addition to strengthening Dawn’s operations by seconding more skilled senior staff, Dawn will implement new training and coaching programs, develop a wider range of products and services, establish new HR and IT systems and internal controls, and prioritize customer education and protection.

The people of Myanmar have been waiting half a century for such opportunities, and Accion is working hard to deliver.

Jordan Coriza

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