Follow STA Group Business Architect Nida Khoutakoun as she details her Insight trip to Columbia!
Opportunity International‘s Colombia Insight Trip has officially started!
We were met with two local staff members, Brian Olarte, Marketing and Transformation Coordinator, and Lina Guzman, CEO of AGAPE (the NGO of Opportunity in Colombia). Four other OI staff members from the US also joined us on the trip. Aside from enjoying the local Colombian food, everyone had a chance to make introductions to the group. I was able to learn about everyone’s experience with OI thus far, some dating back to 1989. I’m excited to learn more about what motivates everyone to give their time and money to this cause.
We have a full itinerary for the week, beginning at 7am on Monday morning, so I will leave you with two fun facts.
Early Monday morning, we were visited by a Director of Banca de las Oportunidades, Juliana Alvarez Gallego. She gave a past and current state assessment of the financial products offered to low-income families, and she also provided us with an overview of the many services the bank offers to promote formal banking. They have been able to significantly increase usage and ownership of savings accounts across the country as well as provide access to banking institutions. Other services the bank offers include financial literacy programs, mobile banking, impact evaluations, and technical assistance. In partnership with both the Colombian government and private banks, Banca de Las Oportunidades has helped to provide 99.9% of the country with access to some form of banking. Only one municipality in Colombia does not offer a formal bank.
After our talk, we walked over to the Opportunity International office and was fortunate enough to meet and speak with Enrique Ordonez, CEO of OI Colombia. Since acquiring its banking license in 2012, OI Colombia has been focused on getting its revenue back up. With the concerted efforts of Enrique and his team, they were able to break even in just 25 months. Aside from being a bank that lends money and offers savings accounts, OI’s NGO branch, AGAPE provides formal training, financial literacy programs, and a Roof and Floor program that lends money to people who would like to build a home. Enrique’s heart and vision for both the organization and the poor people of Colombia were motivating and provided wonderful context before we visited the clients.
The first client we met was Octavio Viñas. Octavio is on his second loan with OI. As an entrepreneur, he collects egg cartons from various vendors at produce distribution centers, cleans them, and resells them to other vendors. Initially, Octavio used his bicycle for pickups and deliveries, but with his first loan of $2,500, he was able to create more efficiency and capital by purchasing a truck. Octavio has repaid his first loan and has borrowed an additional $2,500 to buy a lot and build a two story home on it.
Next, we traversed up to a mountainside to visit Blanca Lozano who received her first $4,000 loan from OI. Blanca owns a bakery and in order to comply with health code regulations, she used the money to tile the ceiling of her bakery.
Lastly, we visited Jose Urrego and his family who manufacture knife and machete holders. Not only were these products functional for most of the rural Colombian citizens, they were also works of art. The craftsmanship was beautiful. With his loan of $2,500, Jose purchased a machine to reduce the manual labor required to imprint designs onto the knife cases.
After a long day, I was able to learn more about OI’s operations, and the impact on its clients. We are visiting one more client in Bogotá on Tuesday and I’ll update you from Cartagena!
Day 2 of the Colombia Insight Trip has come to an end and as our plane landed in hot and humid Cartagena, I knew we would be in for another adventure. The day started with an introduction to Sebastian Perez Villarreal, Foreign Investment Advisor with ProExport Colombia. ProExport Colombia is a government agency that is responsible for boosting tourism, foreign investment, and exports promotion. Sebastian informed us that microfinance is increasing and has risen 17% since 2013, and the portfolio of funds has increased by 13.7%. There are currently 2.8M microentrepreneurs in Colombia. Although I’m not sure the total value of the microfinance portfolio, it is obvious that more entities, banks and NGOs included, are finding it more attractive to offer these loans to clients.
Shortly after the talk, we headed to southwest Bogotá to meet with Parmenio Ayala Pimiento and his family. Parmenio is working on paying off his second loan from Opportunity International. His first loan for $1,150 was used to purchase additional inventory. After Parmenio paid off his first loan, he was lent an additional $5,000 to upgrade his workspace to separate it from his home. In addition to hiring two employees, his wife and three children are also active participants in the business. Parmenio’s fruit-shaped ornaments are carved from wood, painted and lacquered to create a beautiful shine. His customers, retail outlets and private clients, are able to purchase magnets and small, medium and large sized fruits for display.
Edgar is Parmenio’s loan officer and he accompanied us on our visit. The common theme between the two loan officers we met in Bogotá was the flexibility of working at OI. One is still a student and Edgar is a family man who appreciates the work-life balance. They’re also more than just loan officers. They also offer advice on expenses and investments. Between the two loan officers we met in the two days in Bogotá, only 2 out of their 128 clients are unable to pay back their loan. Although the loan officers have many clients, this shows they are able to build a trusting relationship with each of them because they understand what their clients are capable of doing, and set them up to be successful.
The visit in Bogotá was fun, informative, and safe thanks to our great hosts and security crew!
As I predicted when I landed in Cartagena, the city followed through and offered a truly inspiring adventure. One aspect of this trip that I didn’t even consider is learning about the life of Opportunity International’s employees. OI provides optional devotional time to their employees in Cartagena three times a week before their work days begin, so we attended one and were introduced to each of the terrific loan officers.
Before I tell you more about their employees, here’s some information to help you understand some of OI’s work. In Cartagena, OI employs a Trust Group methodology that is not yet utilized in Bogotá. In a trust group, each member is accountable for his or her share of a larger group loan. If someone is late on her weekly payment or is unable to pay, the rest of the members must help her find a solution or pitch in to cover her payment. With the help of AGAPE, trust groups also receive financial literacy training. We were able to witness a trust group meeting where the members had a reflection time to build team morale and an AGAPE-led training on saving. Just as with the individual loans, the trust groups also have a loan officer.
Regardless if it’s rain or shine, loan officers, who are all women, must travel to the poorest regions of Cartagena to meet with their trust groups who live in dangerous neighborhoods that often do not welcome unfamiliar faces. Not unlike the loan officers we met in Bogotá, these women are more than loan officers. Interestingly, some of the loan officers were previous clients. Because of this, they’re also able to be the clients’ counselors, financial advisors and friends. To learn that the loan officers often work long hours due to these extra efforts as well as the long travel time was very inspiring.
We discovered another inspiring story when we made the final stop of the day. After being forced out of her home in Bogotá, a seamstress, Maria Emma Pinzón, moved to Cartagena with hopes of opening up a school. With the loan that she received from OI, she now trains students from Cartagena’s poorest areas on how to sew. After just one tuition-free month, the students are equipped to begin a career as a tailor. What makes the story even more inspiring is that she does not do any of this for money. She told our group that she does it from the love in her heart. She also teaches her students this and tells them to follow their dreams and work for love, not money. To the right you’ll see a photo of one of Maria Emma’s very old sewing machine.
After a talk from another ProExport representative, we drove an hour away to an underdeveloped area of Cartagena where we met with children participating in a bible school. The children were all part of an AGAPE-led program that complemented their parents’ savings program. When we arrived, the students had just finished their lesson on savings, and were getting ready to paint their piggy banks. The kids told us they would like to save for bicycles, and soccer shoes.
To promote savings for people without access to formal banks, AGAPE teaches a group of at least eleven community members how to save and be accountable for each other’s money. The group is provided a box and three locks in which to keep their savings and community activities funds. For security and accountability reasons, key and box bearers are four different people. In an eight month cycle, members of the groups can take turns adding money to the box as part of her savings, or if needed, she may borrow from the existing savings for a low interest rate. The goal for AGAPE is to help each individual of the group to progress to a formal savings account at a recognized bank.
I really didn’t know what to expect from this trip, but I was able to learn a lot, both for my personal life and for our partnership between STA Group and Opportunity International. Learn more about Nida’s trip here.