A First Day Unlike Any Other
I’ve just completed my first week as an Accion Ambassador at Compartamos Banco in Mexico City, and I realize that this is not going to be an ordinary summer internship. As I tackle the challenge of bringing financial services to low-income populations in Mexico, I’ll do my best to document my experiences in this blog.
I must admit that I was a bit nervous when I was asked to arrive to work at 6:30AM on my very first day. The purpose of this early morning call time was so that I could accompany staff on a field visit to Puebla, a town about 140km southeast of Mexico City. As soon as our van started to pull out of the sprawling capital, Compartamos member Vanessa gave us a presentation on the company’s philosophy, credit programs and business model. I tried my hardest to pay attention but, in my sleepy state, I was really just wondering what the day, and the rest of the summer, would have in store for me.
I didn’t have to wait long to find out. We arrived in the municipality of Tepeaca around 9:30AM, and the branch was bustling with activity. The loan officers were scurrying around organizing all the documents needed for their busy day in the field. Before the day was over, they would have to visit about six or seven different client groups in the rural areas surrounding the city.
We left them to their work and quickly departed to begin our client visits. After driving about an hour, we arrived at a small village where a newly formed group of six women was receiving their very first loan. Although Compartamos issues individual loans based on personal need, the lending occurs as part of a loan group, with the loans guaranteed by the entire group. For this reason, the loan officers stress the importance of only accepting trustworthy friends and family as group members. Some of these women had participated in other Compartamos loan groups, but some were receiving a loan for the very first time.
I soon realized that these groups were a very important part of each of these women’s lives. In order to enforce collective responsibility and respect for each other’s time, the women established a weekly meeting time that would remain constant over the 16-week loan cycle. If any woman arrived late to the meetings without a legitimate excuse, she would have to pay a small fine, and the proceeds of the fine would be used to buy supplies such as a calculator or cookies for the next meeting.
Before completing the process, each member had to state the loan amount and purpose in front of her whole group. Most women were taking out loans in order to buy food for their sheep, ingredients for their tortilla business, or supplies for a small store.
The meeting concluded with an official inauguration ceremony in which the group leader cut a white ribbon and handed pieces out to group members who then tied it around a small tree. These ribbon pieces signified the commitment each woman was making to the group and to herself during these next 16 weeks. Throughout the ceremony, even the shyest members of the group could not hold back their smiles.
We left this group and proceeded to visit a more established loan group of 28 women in another village. They were also receiving a new loan, but many of them had been together for over 9 years, and the camaraderie was evident. While the first group was shy and reserved, the second group was more talkative and unrestrained. They were laughing and joking with us, and even shared the juice and cookies that were bought from the late-comer’s fines.
These women were more forthcoming with their business plans and I discovered that one woman had managed her tortilla business for over 15 years, and sold tortillas in several locations in the city. Another woman showed me her delicately embroidered napkins that she sold all over the country.
We stayed and chatted with these women for as long as we could, but eventually needed to make our way back to Mexico City. As I reflect on the events of my very full first day, I realize that these loan groups play a vital role in each of these women’s lives. I hope that by the end of this summer I have a more complete understanding of the complexity of microfinance and the impact it has on people in both rural and urban communities. I hope you’ll stay tuned to discover more about microfinance and Compartamos Banco. I’m definitely looking forward to it!