In my last post I wrote about designing for the extreme user, and Nuru’s holistic, need-based solution for our target “users”, those living in extreme poverty. This week I’d like to think about a different kind of extreme user – the individual poised to break away from extreme poverty.

If Nuru’s programs work as they should, an impoverished farmer will be able to feed her family through greater maize yields, access clean water, and improve her family’s health. Furthermore, the farmer will be able to save money and invest in her children’s education, or a new business to generate additional income. With the foundation, knowledge and financial means to continue growth, the farmer will be equipped to get out of extreme poverty. But development is not a linear formula. One factor is that there is a strong social obligation to help one’s family and neighbors, if able. The sense of community is strong, and the individual in Kuria does not exist in a vacuum. So as our farmer’s life and economic stability improve, she is also expected to help others financially. Community solidarity is powerful: neighbors will bolt out of the house in a second’s notice, weapon in hand, if they hear the familiar cry that means a cattle thief has struck; it is also a kind of insurance in case of emergencies. But in the case of our prospering farmer, the requests are often disproportional to her actual gain, and this can limit her trajectory out of poverty. This is a common issue for Nuru’s Kenyan staff. Most people in the community think working with a foreign NGO means a fat paycheck, and many times it does. At Nuru however, our leaders are hired after an extensive, unpaid vetting and training process. Even after hire, the salary is modest to reflect our commitment to serving the community rather than self-interest. As a result, our own staff is often unable to save because the requests for help are many and the need is great.   

Recently, many of our managers were pushing for large staff loans. I was concerned because I would expect Nuru staff to be the most financially disciplined as an example to others. The problem, though, is not always a question of financial discipline. It was explained to me like this: even if a distant relative you don’t know requests an emergency loan that you know will not get repaid, how do you justify saving for a business venture or to qualify for a loan when that relative’s child is dying? With a loan, however, people understand that your money is off-limits. There is usually physical evidence – a new business or construction on the house – and everyone knows a loan must be repaid. When saving is impossible, you borrow to save.

Is this a reason to grant credit? I don’t think so. But it does at least provide perspective, and focus my efforts on the right things. Maybe instead of more training on responsible credit we need to create savings solutions that work with, not against, community responsibilities. For example, using illiquid savings and including social obligations in financial planning. The Kurians have been keeping livestock as living savings accounts for generations. Maybe it’s time we caught on.

The Community Economic Development program is established on savings-led credit and good financial planning. To that extent, we have programs that encourage saving and financial planning before taking out a loan. It is a reasonable path for individual economic development.

But design thinking teaches us to profile “the extreme user”. Design thinking is described as a process that combines empathy, creativity and rationality to meet user needs. It is a powerful tool for creating impact in development as well as a driver for business innovation, and is an important part of our foundation team toolkit. Why the extreme user? Designing for extreme users often provides insight into issues and needs that aren’t yet apparent in the mainstream.

My next entries will explore issues facing the extreme CED “user”. These entries are more thoughts and questions than answers, so any comments or ideas are welcome.

Nuru works in remote, rural areas of extreme poverty. So it makes sense to start with the extreme poor. Living in extreme poverty, as defined by the World Bank, is living on less than USD1.25 per day (adjusted for purchasing power parity). But economic definitions don’t capture the desperation, the lack of choice, options and opportunity experienced by 1.4 billion people - the poorest of the poor. It is the most severe state of poverty, the level at which basic survival needs are not met: food, water, shelter, sanitation and healthcare. Imagine having no option for basic healthcare and adequate methods to dispose of human waste. Imagine if your choices were bitterly limited to choosing which one of your children gets to eat each night during the hunger season. This reality jettisons much of the capacity to save and plan that the CED program seeks. You can't save if you don't have enough to eat, and you can't plan if you are struggling just to survive.

So we started with the agriculture program, providing a loan of high quality maize seed and fertilizer. Combined with improved farming methods, Nuru members were able to harvest a yield high enough to feed their families, repay their loans - and save. Is this borrowing to save? In a way. But improved yields rely on more than just the loaned farm inputs. Before the loan is given, farmers form groups to receive training and help carry out the group-based farming methods. Attendance and participation are heavily enforced. Training includes an investment in the group and the planning required to carry out the farming methods, as well as the expectation to save enough maize to feed the family until the next season. A lot is expected to qualify as a Nuru member, ensuring that the farmer who receives an agricultural loan is a farmer who has invested, planned and saved. 

It's harvest time once again at Nuru's project in Kuria, Kenya. Hear from CED Program Manager Vivian Lu and Field Officer Andrew Chacha as they discuss Nuru's Agriculture Loan repayment program and provide an update from the field.

This capped off an already rough week. Every program hit a road block at some point – a database crash, errors in the farmer seed/acreage data, attendance issues, stalled progress on well permits and school sponsorship. Everyone has these weeks – when despite all your work nothing got done and previous work was actually undone. 

As the ants appeared to be flanking the house, our night guard Evans appeared and calmly asked for a cardboard box and matches. On cue, an orange glow rose from the neighbors’ yard as they too, battled ants. So we set the yard on fire, forming a burning barricade of cardboard strips in front of the house. The ants retreated (local knowledge wins again). Over the next few days there were smaller surges of ants but we had help – our neighbor Thomas, and one of our regular motorcycle taxi drivers Peter dug up the nests and smoked them with burning tires. 

It’s hard to have perspective when you’re having a bad week. Yes, next week will probably be the best week of your life but this week it seems your work and life are crumbling to the ground. Yes, the week would have been better spent catching up on sleep. But that’s a moot point. When there is a biblical swarm of biting ants in the backyard (or whatever your case may be), no one asks the ants why. 

Like most bad weeks, when the ant raid was over we recalled it in gory detail and laughed about it later. For the next army ant swarm I will know what to do: 1. Forget about your other plans for Friday night. 2. Go for help from the people who know. 3. Set stuff on fire. For the next bad week in general, I may try to apply the same strategy: 1. Dig in. 2. Surround yourself with good people. 3. Go forward with gusto.

Transition time in the Nuru Project is a month long whirlwind of action. The culmination of a rotation’s work is all coming to fruition as we transfer all of our knowledge, work plans, initiatives, books, etc.. over to Foundation Team 5. Vivian Lu and I have done two previous transitions with each other, so we know how each other work and have a knack for making the most out of our transition time together.

There is so much activity right now that it is hard to keep track of where everyone is. The houses are packed: David and I are living in the living room of the lower house and Jake is living in the living room of the upper house. It is beginning to feel like a youth hostel. Needless to say the houses are alive with all that is Nuru.

I have just over a week left of work to do in the project before I transition back home to work with Nuru’s Development Director, Don Jorgenson. In this short time left, I have got a lot on my plate: we are deploying MIFOS (our banking software); we are starting our M-PESA (mobile money transfer) capabilities; and we are training all of the CED staff on both. 

By next week we will be able to have all of our accounts on MIFOS and access them all remotely with mobile banking capabilities. This is a huge jump to make in a week, but while the capabilities are there, we are going to be cautious with the implementation of our new technology. Before we unleash it completely to all of our members, we will get all of the kinks out. 

With the pace that we are keeping and my recent late night coffee consumption, I am going to be sprinting until I leave next week. There is such synergy in the project at the moment. New teams bring new ideas, and all I can really do is harness all of the energy here at the moment to develop lasting solutions that will impact the lives of the people whom we serve. 

I aim to do a video next week that will demonstrate the new technology. I apologize in advance if I am a bit disheveled looking next week, I will most likely be running on fumes. See you next week.

The end of my rotation is quickly approaching. Vivian, my counterpart in the CED Program, arrives on Monday, then I will be transitioning out of the project. I am set to fly out on 11 July. Time always flies on our Foundation Team tours. The past 5 months have gone by more quickly than summer vacation.

Looking back at the program, we have come a long, long was since we started. As we approach the completion of our second year in Kenya, it is remarkable to think of our humble beginnings. Just over a year ago, the savings clubs were just starting. Now, we have members who have graduated from the yearlong vetting process and managed to accomplish so much in such a short amount of time. I cannot help but be amazed at how far they have come. 

I am very thankful for the wonderful people with whom I work. The CED team (Moses Woirungu, Peter Gati, Joseph Gikaro, and our Field Officers) have come a long way since we started. They have all become quite skilled in finance and experts in using the Internet via mobile phone. Next week, a couple new netbooks will be arriving, so the CED team will begin training on computers in preparation for MIFOS

Vivian and I are going to be testing MIFOS next week, so I am very excited to get this all set-up. As you may remember from my video post two weeks ago, all of the CED Field Officers have become quite skilled with mobile phones. In the coming weeks, we are going to be expanding on their skills to incorporate more and more mobile banking activities.

In a matter of weeks, we will be transitioning from Excel spreadsheets and paper ledgers to MIFOS and Google Forms accessed through Internet-enabled mobile phones. This is sure to be an interesting transition, so rather than talk about it, I think that it would be better to do a series of videos. I will cut this blog short to save some footage for next week. 

Until then, thanks for reading!

It is rare that earth-shattering news is actually delivered with earth shattering. Late last night, in those wee hours that are technically morning, we awoke to the sound of crashing, booming, and something like an explosion. These were the kind of sounds that aren’t accidental. Terror was the first thing that wrestled me from my slumber. Was the compound being attacked? Were we being robbed? Was there a riot or had civil war started? All of these are very, very logical assumptions when one is awoken by these sounds in our area. 

I am from Southern California. Earthquakes are a part of life. As kids, we used to find the small ones amusing, and we’d laugh at my grandmother as she ran around the house in a panic (she is not a Californian). Now as an adult, earthquakes are greeted with a bit more reverence. I think every Californian is a part-time water cooler seismologist. I, also, think people probably rush to update their Facebook  status quicker than going to seek cover under a doorway; get under their desk; stop, drop, and roll; or whatever you are supposed to do in an earthquake. 

Last night we had what from all accounts was an earthquake, but I have seen no news or reports on it. Let me tell you, as a Californian, the earthquake last night was a pretty scary one. I have been through my fair share, but it is something else entirely when you are in a building in an area where there are no building codes. A brick building with metal doors is not where you want to be in an earthquake. From what we have heard today from our friends and neighbors, everyone is still pretty stunned. Luckily, I haven’t heard of any injuries. 

Financial Capital:

So, I started by saying that “it is rare that earth shattering news is actually delivered with earth shattering”, now that I have explained the earth shattering part, allow me to explain the news. It is actually quite personal, but I think that it is relevant to mention. Laura and I are finishing up our tour in Kenya. We will soon be moving back to California. We have been trying to buy a house, which is no easy task in this economy, in Orange County, and based on our income, and due to the fact that Laura has not been a resident of the USA for a full year yet; but it has been our goal for quite some time. We found the house that we wanted; we were in escrow; and we thought that we had everything for our mortgage squared away, but immediately after the earthquake, we got news that we won’t be able to get a mortgage for at least several months, meaning that we will loose the house that we have been in the process of buying.

I know this isn’t exactly earth shattering news in the context of extreme poverty, but it is pretty horrible news for us in the context of our lives, goals, and dreams. Combined with last night’s earthquake, it made for a pretty bad night last night. This experience has led me to reflect a bit on walking in the shoes of our members who are applying for Nuru loans everyday. I have forgotten how crushing denial of one’s aspirations can be. I deny loan applications everyday because I do not deem them to be viable. I think that the rejection of my mortgage will be instructional for me in my work. 

Does this mean that I am going to start approving loans with my heart rather than my head? Absolutely not. The most frustrating part of the mortgage process for Laura and I was not the rejection (yes, that was ultimately the most frustrating part), but the lack of knowledge and the inability to understand the process and language being used. I work in microfinance, but I still had no idea what more than half of the terms meant in the real estate process. I think if we could have been better informed throughout the process, we could have managed our expectations better. 

I am using this experience to improve our process for applying for loans. I can do a better job to keep our loan products and qualifications clear and in language that everyone can understand. While Nuru can’t approve every loan application that crosses our desk, we can make our process clear, quick, and easy to understand so that our members can manage their expectations throughout the whole process. If our members don’t qualify, I would like to provide guidance for them, so that they can qualify in the future. 

Live and learn. 

Continuing on with the structure of last week’s blog, I have divided the blog into two sections: social capital and financial capital. This division is meant to divide business from pleasure- or living from working in rural Kenya. 

Social Capital:

I am absolutely an integrationist: I believe that if your project is based in remote rural areas, then you must have staff living in those same remote rural areas. I know this is not always possible, but I believe the benefit greatly outweighs the barriers. I understand that there is a divide among professionals. 

I come from a Peace Corps background. Peace Corps can be, in my view, one of the best on-the-ground experiences that one can get as an outsider to help oneself understand poverty. This experience, however, is not to be understood as a replacement for growing up and/or living as a member of one of these societies for an indefinite period of time, but a Peace Corps Service can offer a frame of reference from which someone can begin to understand what it is like to live in poverty. 

Living in poverty as a Peace Corps Volunteer can by no means be equated to poverty which surrounds one during one’s service. No matter how real it feels, one’s service is still in some ways pretending to be in the state of poverty for a defined period of time. This is not to take away from Peace Corps or its volunteers. I know volunteers who integrated to the extreme in which behaviorally they were indistinguishable from the people with whom they lived and worked, but essentially there was always a divide. They always had their plane ticket home, and an alternate life waiting for them.

In my opinion, as an integrationist, far too many organizations are based in capital cities. Their projects have large white SUVs with their project decal on the side of the door. Sites are visited, but not lived in. I am not stating this difference because I work for Nuru and Nuru does this, so I think it is right. One of the main reasons that I chose to work for Nuru is because the project is based in the field; Nuru doesn’t have a car, we take public transportation. We are really building relationships with our members. Living in the field and not having a car can be a real pain. Power outages, power surges, no refrigeration, water shortages, not being able to go out past dark, etc..  all can make our lives more challenging in the field, but it makes for a far more successful project. Living in the field; building relationships on a daily basis; and listening to the people with whom you work can allow one to keep one’s finger on the pulse. Disconnect brings problems. 

Next week, I am going to be discussing integration in the context of brain drain and language. 

Financial Capital:

Microfinance is not the cure to poverty. Mobile money will not single-handedly eradicate extreme poverty. I wish it could all be that easy. Until people make more money than they spend, poverty will be present worldwide. This poverty can manifest itself in different ways. Depending on one’s ability to access credit, one can appear to be far better off than one is. Sooner or later living beyond one’s means catches up. What is true at home is true here. 

Microfinance can be an excellent tool for those who need to have access to credit, savings, and/or insurance; however, the quality among these financial products can vary widely. What can be called microcredit and carry with it all of connotations of helping the poor lift themselves out of extreme poverty can in practice do the opposite. Without adequate safety measures and an extremely elastic demand for credit, predatory lending is all too common. What is touted as eradicating poverty can actually be creating poverty.

Savings products too can be misleading. The fees associated with a savings account can prevent savings altogether. Until recently, it hasn’t been viewed profitable to offer banking services to the extreme poor. Mobile banking will hopefully turn a lot of this on its head. M-Kesho looks like a promising turn for mobile savings accounts.

Lastly, insurance can, perhaps, be most misleading of all. Fine print and impoverished populations can make for a dangerous combination. I have a master’s degree, and I still need my brother (who is a lawyer); my mother (who is a physical therapist); and Karina (Nuru’s HR Director who has become an insurance expert) to tell me what my health insurance plan actually covers. Still when I go into the doctor’s office, I feel like it is a crapshoot. Imagine trying to understand insurance policies without the access to education and educated individuals. 

I have heard so many horror stories of micro insurance companies; it is unreal. Still insurance can play an important role for medical expenses, crops, etc.. Most recently, I was conducting a case study with some of our staff to test the efficacy of a national insurance product, which I though might be good. It turns out that in order to use the insurance, you need to bribe the hospital because it takes the insurance company so long to pay that it is not cost effective for government hospitals to accept the government insurance. I am still on the pursuit for better insurance products.

Next week, I will be discussing the local organic micro financial institutions in Kuria: the collective.

I am undoubtedly on my phone more in rural Kenya than I am in Southern California. I use my Nokia here for more things than all the apps put together on my iphone at home. Most recently, I am looking at using phones for banking. In past blog entries, I have mentioned Nuru’s teaming up with FrontlineSMS:Credit and MIFOS to develop a mobile banking solution. The goal is to allow Nuru farmers the ability to manage their accounts, receive loans, and repay loans with their phones from their fields. I will keep you updated as we progress.

M-KESHO: Mobile banking is becoming a force to be reckoned with in Kenya- at least potentially. For those of you who missed my blog post last week, M-Kesho is a product born out of a partnership between M-PESA (mobile money) and Equity Bank. It allows for a mobile phone-based savings account, which also has loan and insurance capabilities. The idea is to extend branchless banking all the way down to the poorest of the poor- who have a mobile phone.  There has been a large void in the Kenyan banking community. Poor, unbanked populations often view the high fees associated with banking as prohibitive. These views are further reinforced with alleged reports of individuals opening accounts, keeping 200 Ksh (<$3.00) in the account only to come back a year later and find the 200 Ksh gone, and the account holder actually owing money to the bank for services. The merits of these allegations are never known, but for many these are plausible outcomes. 

M-KESHO seeks to address this void by reducing transaction costs overhead, thereby allowing the majority of their banking services to be free. I feel there is no better way to learn about a product, than to test it oneself. I plan to set up an M-KESHO account ASAP to test it, and see how it works. M-KESHO took Kenyan banking and microfinance by storm last week. I believe that mobile banking will have the potential to expand financial services to the otherwise unbanked. I am, however, wary of early claims that this was the missing link to poverty eradication, and the “mission accomplished” is just around the corner. So many false dawns have been touted in this field that I cannot help but be skeptical. M-KESHO, like any other mobile banking product, is a tool. It may have the potential to be a very powerful tool, but it shouldn’t be ascribed to as the new panacea to poverty. 

The Kenyan banking climate is rout with perils for the poorest of the poor. High banking fees, high transaction costs, lower interest rates on savings accounts, a high inflation rate, and predatory lending can all lead to making the poor poorer. By educating and increasing access to services, Nuru is preparing its members to have a securer tomorrow. 

Next week I will continue to expand on this series on managing capital. 

As I have mentioned in previous blogs, I am not much of writer, but my job requires me to write blogs, so we are stuck with each other, so let’s make the most of it. While I am not much of a writer, I try to make up for it with an above average understanding of punctuation and sentence structure; however, if you are looking for a boring blog about microfinance with perfect sentence structure and grammar, then I am sorry; you have come to the wrong place. This is a boring microfinance blog with above average sentence structure and grammar. 

If you haven’t already noticed, this first paragraph was what they call a hook in the writing biz. I am fully aware of my ineptness as a writer. While the subject matter I am writing about is tremendously important and interesting, I have the uncanny ability to make it sound boring. To supplement my lack of scholarly skills, I plan to use lots of links to photos, videos, and sounds to make my writing come to life. Hold on tight for this week’s blog. 

Managing Capital Series: 

I want to start a several entry series on managing capital. In these entries, I am going to focus on the management of two types of capital: social capital and financial capital. The latter is far more commonly used in microfinance than the former, but, in my experience, the two go hand and hand with one another.

This series of blogs will be divided into parts 

Social Capital:

A large part of my work is not finance related; in fact, nearly any banker (who is still in business) would be better at my job if it were purely a financial management mandate in nature; however, the majority of my job has nothing to do with finance. This is where social capital management comes in. 

From day one when one is entering a project, one is working against a series of preconceived notions about who you are and what you do. Projects never start from scratch, one is always building upon the past. When Kurians see wazungu (foreigners/white people/the English) projects, their reaction to the project will likely be based on any pre-existing experiences, perceptions, and/or misperceptions of what projects are and do. This is a difficult inheritance for many “aid workers” who see themselves as “different” to accept. Regardless of one’s own direct responsibility, it is a collective legacy within which one assumes a role- albeit at times reluctantly. 

I have found through experience (ie., trial and error) that trying to convince people that you are different; you’re not rich; you are honestly here to help; you don’t give hand-outs; you aren’t going to abandon them, etc.. is more or less futile. These recitals are cliché, and generally only work to reinforce preconceived notions of projects and wazungu; instead, I recommend circumventing this preexisting belief structure by doing the unexpected. Actions speak louder than words, but the language of the words used helps add to their impact.

In our project, for example, we don’t have a car or even a motorcycle for our Foundation Teams. There is no white SUV with the project’s decal on the door. This decision is in part due to financial constraints (we would rather be spending our donors’ money on the project not vehicles) and in part due to reluctance on our part, as an organization, to fall into the preconceived notions of what “projects” look like. We walk a lot, which gives us an in-depth knowledge of the communities we live and work. When we aren’t walking we use public transportation.

Again, I am not coming from any sort of high-ground or expertise. This is an account based upon personal and organizational experiences. These recommendations/observations are often the result of trial and error. I will continue to build on this anecdotal account over the next series of blogs. In the meantime, check out this blog, which is a good starting point for any sort of discussion on how development workers should live. 

"Unlike other assistance provider, Nuru has on the ground experience that provides practical approaches to build capacity leading and increased efficiency, innovation and customer-focused business growth. Nuru are locally based and so we understand the needs of our clients, their operating environments and the unique features of each institution. We have a unique operational style where most of the working day of a staff member is spent in the field.

We believe that the client should be at the centre of all product and processes. In keeping with this ethos, field operations are accorded highest priority with each staff member spending 70-75 [percent] of his/her time in the field, understanding the nuances of the operating systems, processes, and our client’s behavior.

Before Nuru my community used to leave a lot of the finer details in the hands of the Holy Spirit. However, Nuru has now taught us how to plan and put systems in place so that we now have the power to oversee the finer details ourselves."

BE HOPE BE LIGHT BE NURU.

We just had Fanon Gikonyo, from Mashariki (Eastern) Solutions, come to the project. He is going to be implementing MIFOS for us in the coming weeks. This last week we conducted a gap analysis to see how neatly the banking software would serve our CED operations. The whole CED team was involved in the gap analysis: Joseph Gikaro, Peter Gati, Moses Woirungu, and Erick Kichere all provided a great level of detail that will be invaluable for the process.  After the site visit, Fanon headed back to Nairobi to start the MIFOS build. I will keep everyone up to date as this deployment unrolls. 

Rainy season is definitely an experience. I don’t think that I have ever seen it rain like it does here. The closest that I can compare it to would be the rain while we were in Nicaragua’s RAAN. The power of the rains is definitely easy to romanticize, but I generally try to steer clear of such feelings, and, instead, opt to try to stay as objective as I can; however, it is at times awe-inspiring. 

We work in agriculture, so rain is a key ingredient to success. Rainy season does, however, create a significant impediment to timely transportation. The mud, potholes, ponds, etc.., created by these heavy rains can make for logistical nightmares. Last week, Laura, David, Kelsey Timmerman, and I got stuck coming back from Nyametaburo. The river that divides Naumetauro and Isibania  had swelled and become impassible while we were out, so we had a long, muddy detour through Nyangiti, which added an additional three hours to our walk home. The road along the way was riddled with stuck vehicles. It looked like the Automotive La Brea Tar Pits, which made the possibility of a pick-up out of the question. 

This is an all too common scenario. In our case last week, the detour resulted in me preparing dinner a bit later than usual, and us being covered head to toe in mud, but imagine more dire situations (or even the mundane day-to-day wear and tear). At least half of every year is like this. Take an already disconnected, rough system of dirt roads; add copious amounts of water; and, then, you have a whole host of problems. 

Lack of infrastructure can be a rather significant impediment to a lot of steps in the elusively difficult-to-define “development process”. Sometimes steps in this process can be skipped, while other elements cannot. Bono’s NYT article from last month, surveyed a lot of recent developments in Africa. The last part of the article highlighted two points, which I will build upon for today’s blog entry: predatory lending and the need for infrastructure.

While some steps are critical and others can be skipped. Mobile phones are probably the best example of the ability to skip some steps in infrastructure development. Mobile phones have almost completely made landlines an anachronism in much of the world- this includes sub-Saharan Africa. Much of the Developing World has simply skipped the costly, time-consuming step of installing landlines, and went immediately to mobile phones. The use of  a computer to access the Internet is also a step, which can maybe not be fully skipped, but at least sidestepped through the use of mobile phones. David has gone into detail in past blog entries about our democratic usage of Internet-enabled, low-cost Nokia phones, so if you are interested, I would recommend going through his entries. 

This past week the Kenyan banking community has been pulsating with activity regarding yet another attempt to either skip or sidestep a step in the infrastructure development process. M-PESA (mobile money), which I have spoken about in past blog entries, has partnered with Equity Bank of Kenya to create a new mobile banking product: M-Kesho (or mobile tomorrow).  Nuru is looking to partner with FrontlineSMS:Credit to develop a similar interface, which has long been in the works, but with two giants like M-PESA and Equity Bank coming out with a product like this, it really stands to revolutionize the way Kenyans bank. I hope this new product ushers in a era of competition among the banking community to really service the needs of the Bottom of the Pyramid. 

We still haven’t figured a way to get around the obstacles created by undeveloped roads during rainy season; in our defense, I asked Stanford’s Extreme Affordability Program to develop zip lines when they came out here several months back; and, I am still waiting for their reply. Some steps can, indeed, be skipped. Whether or not M-Kesho or other mobile banking products are skippers, sidesteppers, or dead-ends, I will discuss next week. While M-Kesho looks like a good savings product, their loan product looks a lot like the predatory lending, which was mentioned in Bono’s blog. I will go into more detail about this next week. Along with next week’s blog, you can expect an update on our MIFOS implementation.

People always ask me what my days are like here, in Kuria. My standard response is that my life in Kenya is pretty similar to my life in Southern California- except different. My blog generally concentrates on the CED program. I try to give updates and unveil our plans for the project. Some of the feedback commented on the possibility that my blog could be boring for those who don’t live and breathe microfinance and international development. In all actuality, my writing “style”- if that’s what you want to call it- has all the captivating qualities of C-SPAN with less content.

Today will be different. No, I didn’t do any creative writing workshops during my home leave, so readers cannot expect any improvement in the quality of my writing; however, I generally can boast that my blog contains an above average usage of proper grammar and an over-active appreciation of alliteration, so if you are a lover of semi-colons and even full-fledge colons, then grip the reins for another bolstering blog:

I suppose my daily routine is pretty normal (if there is such a thing): I wake-up around 6:00 to 6:30; I make my morning cup of coffee; and I read the news. Sure, there are differences: I do get dressed in long-sleeves, long pants, and put on socks to limit the mosquito attacks; I change our nighttime guard with our daytime guard- when it’s my turn; I make my coffee with a little cafeteria and powdered milk (fresh milk isn’t easy to come by early in the morning and we don’t have a refrigerator); when I check the news, I start with Africa section to make sure that everything is still “OK”; and then I start my day. 

My commute is like anyone else’s: I carpool; I try to avoid tolls; and I hope that I don’t get stuck in traffic on the way to the office. I guess what makes my commute a bit different than the “normal” commute is that: I carpool with two to three people on a motorcycle to get to the office; the tolls that I try to avoid are from the corrupt police trying to extort bribes from me because they see a foreigner (and Kenyans alike) as an ATM; and the traffic jam is either a herd of cattle or a lorry slipping around in the mud on the dirt road on the way to the office. 

My office is an office like any other: we have co-workers; we have computers; and we have a water cooler. Nuru’s office might be a bit different than the one in which you work. Our office building is currently holding 200 tons of maize; the majority of the day is spent in the field (which often is in fact a field) training our members; we have a couple laptops run off of a solar panel, but the majority of our computer work is done over our Nokia mobile phones; and the water for our water cooler isn’t delivered by Sparkletts, it is collected from the local pump that Nuru drilled, and carried by head-top to our office.

My commute home is much like the way to work. Sure there are some other routine occurrences for which we need to prepare: sometimes the rains start early and the roads and bridges are impassable, and we need to go around by foot, which could add around five miles to our walk home; we pick-up groceries- produce at a market stall, meat at the butcher’s shed; and sundries at a “supermarket”; and we all have a curfew. The roads are dirt, so, on a rainy day, we can get trapped in the mud if we take a motorcycle. Rain comes down like a monsoon, so it is first waited out, and then followed-up on foot, which makes for a pretty messy walk home. The groceries on our way home generally require a fair amount of negotiation, which can be limited by prospects of rain and nightfall; the butcher shops are generally something that we would refer to as a shed. Beef hangs split down the center lengthwise on a hook. It is unrefrigerated, so it is good to adapt a keen eye for freshness- 3-day old beef isn’t great for the digestion. As far as a curfew, it is somewhat dangerous where we live after nightfall, which is why we have a daytime guard and nighttime guard. We all rush to get home before dark. It makes for an effective way to make sure that everyone gets home for dinner. We eat together, and talk about our days. After dinner we all do a little bit more work before going to bed. In the morning, we start all over again. 

As you can see, my routine isn’t that different from a normal one that one has in the US or Europe, but what this description of my schedule fails to illustrate is why I get up every morning to face each coming day. I can give a normative explanation of my job or my day, but it fails to grasp the essence of my job or my life here. Everyday I wake-up like a child on Christmas morning. I eagerly await each sunrise to start this routine all over again because I work with some of the most amazing people I have ever met. We work together- everyone- to make lasting change. 

Kuria has been killing and maiming computers left and right. I don’t what has been going on, but we are losing technology fast. We have a million things going on this week. Everyone is trying to get everything prepared for our departure next week. All of the Foundation Team will be on vacation for the majority of April, so it is critical in these last days to get everything set-up for while we are away. Tensions are running high, as the pace is increasing. The finish line is nearly in sight. We have to get everything done in the next couple days, and avoid the sticks in the spokes. 

Stanford’s Extreme Affordability Program is visiting us this week, and they have been on a whirlwind tour of the project. It is so great to have them here, and have them involved with Nuru. On the 26th of this month, we are doing an all-staff training day in which each of us will be teaching modules. In addition to all of this, it’s rainy season, so that means the power is off and on every 20 minutes. Two computers and one external hard drive have been bricked and two computer have badly injured in the past week, so all of us are engaging in a combination of cursing and praying during the last days here. My computer, so far, has been doing well. 

For the past twelve hours, I have been going over the books for the Nuru Savings Club. Our team will be on vacation for the next three weeks (starting next week), so I wanted to get everything set-up before I go. As I mentioned in previous blog posts, we are transitioning the Savings Clubs: some members will graduate to individual loans; some will spend some more time in the savings club; some new members and groups will join; and we only have one group that has made it to the year point, and decided not to continue. 

Today was spent reconciling the Excel books with our hard copies. Now that I have finished with this step, the CED Field Managers will be dividing the interest earned over the past year by the Savings Club Groups’ lending and borrowing. After the interest has been divided up among the group members, then groups can cash out or transfer the money over to the second year’s books. 

It has been interesting going through the books in such detail. The process has solidified even further the decision to transfer over to Mifos. Excel is great, but there comes a time when workbooks become too cumbersome, and an MIS is needed. I am still partly amazed that we even have enough members saving to actually warrant an MIS. Keep in mind that hunger was a huge issue out here less than a year ago. 

Our tracking of the saving habits, borrowing habits, and repayment habits will provide Nuru with a unique window into the financial lives of the people we serve. We are working with graduated members to continue the basic bookkeeping, which they have been doing, as well as add a new level of depth and planning to it. 

When I return from vacation, I will have a lot of things going on. I look forward to sharing these projects as they develop, and I will explain them in greater depth. 

This week, the CED program has been in the process of transitioning the Nuru Savings Clubs. It is hard to believe that it has been nearly a year since they started. In the past seven months*, there have been 75 savings club loans issued, which total to an average of just under $100 each. All of these loans have been paid back in full with interest. We have had a few cases of late payments, but all in all the Nuru Savings Clubs have been a great success. We have used this past year to establish makeshift credit scores while the initiative is observed.

Self-selection plays a large role in many of Nuru’s programs and initiatives. In this case, we have used the Savings Clubs as part of a vetting process to gain access to credit. This process determines who “graduates” out of the group structure into an individual account. The individual account will allow qualifying member the opportunity to save and borrow individually. We have monitored how our members save; borrow; lend; repay; and even if they attend meetings. We are using all of this data to mitigate risk. The correlation between past financial behavior and future financial behavior is far from perfect. The lives of those who live in extreme poverty is highly unpredictable.

“Portfolios of the Poor” by Collins, Morduch, Rutherford, and Ruthven gives an all-to-rare glimpse into poverty at a micro-level. Often poverty or extreme poverty is understood as those making less than $1/day PPP (or $1.50 or $2), but what does that actually mean? Portfolios of the Poor goes into a lot of detail to explain the common misconception that people in extreme poverty (or poverty) are actually making $1-$2/day consistently on a daily basis. In my experience and what is described in the book, a consistent daily income is the exception rather than the rule.

One of the biggest obstacles in the financial lives of the poor is the inconsistency of daily income and expenditures. Farmers may make on average less than $2/day PPP, but that doesn’t mean that they have a daily income. Most farmers here farm cash crops, staple food crops, or both. This means that most farmers earn their money seasonally, not daily.

When one depends entirely on a seasonal income, one must take a lot of factors into account. Imagine getting a paycheck for an unknown amount once every six months. I know that I would have trouble budgeting, and I have access to a bank account, online banking, and some training in accounting. A large amount of expenditures are also unknown. One relies on nature to put food on the table, but the same rain that waters one’s crops can destroy one’s home. Too much rain can ruin one’s crops.           

Being from Southern California, I have never needed to be too observant of the weather. It’s sunny; it’s nice; and, our meteorologists have an easy job, but here, I actually really stress about the weather on a regular basis. Is it raining too much or too little? Will hail destroy our crops? (It is obvious that I am from California when I actually had to look up how to spell hail; and, yes, it hails in Africa).

There are so many factors that need to be determined, and so little few details are concrete. Microfinance serves an extremely important role in lives here. Savings and credit make up a huge part of our microfinance initiatives, and we are looking to develop insurance products as well, but it is certainly a complicated task that must be well thought out. 

I will continue to discuss strategies that we are using to help our members deal with an uncertain future. By the sheer fact that our members are starting to save and plan for their futures, I consider this a big step forward along the path of escaping extreme poverty. 

*If you remember from a previous blog post, 12 weeks of savings is required before a group can take out their first loan.

This week, like all of our other weeks, has been jam-packed. We (the CED program and Nuru Research Team) have continued exploring and testing different possible applications for cell phone data collection. In just a short time, a wide variety of cell phone applications have been developed.

We are looking seriously into integrating mobile banking (that is banking using a cell phone- something like M-Pesa) into our current CED strategy. At present, I am looking at the possibility of adopting Mifos (developed by the Grameen Foundation) as our MIS, so, as a result, I am also looking into middleware, which would allow our mobile banking to interact with our MIS in a simple an efficient manner. We have seen some interesting possibilities, and are always open to input. I will keep developments coming as we make the jump from spreadsheet to MIS and receipt to cell phone.

Banking software, databases, mobile data collection, and mobile banking are all amazing advances in technology. Very quickly these technologies will transform a lot of our operations on the ground. We can collect information and respond quicker than ever before. This speed is a huge asset to us, but this speed and efficiency is useless if Nuru’s programs are not impacting our project areas in the way that they need to. Maybe it’s Mulago Foundation’s visit here last week that has me focusing on impact in this week’s blog; maybe it is my Luddite tendencies that lead me to believe that technology alone isn’t the missing link in poverty eradication. Nevertheless, I having been thinking a lot about how Nuru goes about helping communities lift themselves out of extreme poverty, while maximizing the bang for the buck.

To be quite blunt, I neither believe in “silver bullets” nor “golden hammers” in poverty eradication. A lot of practitioners and academics alike toted microcredit as an end to poverty. Now, several years after these claims, it appears that poverty eradication is not that simple. Problems have arisen in microcredit. It appears that microcredit is only as good as its loans. Now there has been a shift to savings-led initiatives. I started a savings-led initiative here last year, and, while I believe it is an effective tool in poverty eradication, it too- like microcredit- is only a tool.  There is a time and place for each. To quote Maslow’s Maxim: "To the man who only has a hammer in the toolkit, every problem looks like a nail."

I wish there was a Swiss Army Knife or a Leatherman for poverty eradication.  Unfortunately, there isn’t a universal tool; and if there isn’t a universal tool, this means there also isn’t a universal training either. Nuru is equipping our members with an ever-expanding toolkit, which includes trainings regarding where, when, why, and how to use each tool. This is, however, an uphill struggle. 

Referencing a previous blog that I wrote last year, poverty is not only a lack of money, but also behavior pattern. The condition of a lack of money is constantly reinforced by the poverty mindset. It is relatively easy to increase one’s short-term wealth (in a relative manner of course). Nuru, as an organization, does not give handouts. We, instead, concentrate on empowerment. Our agriculture program trains farmers to increase their harvest by 300% in one season. So, being that we work exclusively in rural areas, our agriculture program can be quite an effective tool in poverty eradication, but simply increasing one’s wealth does not necessarily decrease one’s level of poverty in the long-term. The tricky part of our job is changing our members’ long-term behavior, so that they don’t revert back into extreme poverty. Behavior change is very difficult. Old habits die hard, but we are making some headway.  

The impact our project has made in our members’ lives still astonishes me, as I mentioned in my last blog post. Behavior is changing. Nuru’s behavior is changing. We have begun to learn together that while there is no miracle cure to eradicate extreme poverty, the poor themselves are their own greatest resource. 

On Thursday, I spent the afternoon in Taragwiti (one of the villages in which Nuru works) at a Nuru Savings Club meeting. We are testing some basic banking transactions using cell phones. Just so we are clear, I am not talking about iphones, blackberries, or anything too high-tech.  We have, instead, chosen to use the inexpensive and robust Nokia 1680 Classic, which is reminiscent in shape and exterior design to my first cell phone. Its capabilities, however, are vastly different. The $39* Internet-enabled phone is going to be replacing a lot of paperwork here in the field. We will be able to collect data; analyze it; and react at an extremely rapid pace- even in remote villages. If you are interested in more information about Nuru’s initiatives in this area, please refer to David Carreon’s  Nuru blog post from last week entitled, “Revolution”.

There are a lot of possibilities, which come with the adoption of this mobile technology. Quick, accurate information is critical to conducting microfinancial operations in the field. By receiving data in real-time, we will be able to respond to the communities’ needs in a much more quick and efficient manner. In the coming weeks we are going to be piloting this mobile phone-based approach to collecting data in the Community Economic Development (CED) Program. I will continue to document how this process unfolds. 

In the weeks since I returned to the project, I cannot help, but be amazed with how much it has changed. While I was home in Orange County working with the Nuru Research Team, I was constantly tracking the project from a macro-level, but now, being back on the ground, I cannot help but be in awe of how far the project has come. I have been keeping up with the quantitative side of the CED Program, but from a distance, the qualitative side of the project is sometimes overlooked. 

Over the next five months, I am going to be continuing where my colleague, Vivian Lu, has left off. Vivian has done a tremendous job in adding an incredible amount of depth to the CED program. The Savings Club Groups have been around for nearly a year. They have saved; they have lent; they have borrowed; and they have repaid. When I visit the groups and speak with the members, it amazes me with how much they have grown. 

One of our members, Josephat Mwita, asked me yesterday if I could advise him on passive income generation because he is nearly finished building a second building on his land in Taragwiti, and he is thinking about renting it out. I was gobsmacked. I interviewed Josephat a little over a year ago (before the CED program started) when he was running a small eatery out of rented building. Now, he not only owns his own building, but he is building a second!?! I knew that he was savvy, but I must admit that I was impressed with the speed at which he was able to advance. It should be noted that Josephat’s Savings Club Group, Mkombozi, is one of our best Savings Club Groups, nevertheless I was pleasantly surprised.

All this talk about change brings to mind an old George Bernard Shaw quote from Man and Superman, as a reference to an individual’s ability to grow at a much faster rate than is generally noticed: “The only man who behaved sensibly was my tailor; he took my measurement anew every time he saw me, while all the rest went on with their old measurements and expected them to fit me.“

I am learning a lot about how quickly projects, programs, and individuals can grow. Vivian has done such an unbelievable job in bringing this program to the next level. What I started with paper ledgers, basic contracts, and a couple spreadsheets has now evolved into whole folders of spreadsheets, protocols, contracts, procedures, and all of these are forming the underpinnings of the MIS (Management Information System) that we are going to be adopting in the coming weeks. Vivian has really set the stage for the adoption of this technology- both the cell phone data collection and the MIS. As I mentioned above, I will continue to post updates as these new initiatives take hold.

Removing the rust and getting back into the field is always a challenge. It always amazes me just how quickly I can become soft. The calluses- both internal and external- seem to thin at a much quicker rate than they were earned. My cast-iron stomach has been the result of years of bacterial battles from which I emerged a scarred victor, yet now a little food poisoning and I feel it. Traveling 48+ hours on transport used to be the adventure side of the job, as I’d imagine the Indiana Jones map following my progress. Walking 10+ miles a day was the best way to learn the terrain, but now I find that I ask myself, “How did I do this everyday?” Insects now bother me. I feel the bumps and bruises of daily life in rural sub-Saharan Africa. No matter how hard I try to silence it, I hear my parents’ saying, “you are getting old.”

I tell myself that this is the part of the job that I love- the grit of reality, but the reality is that I have gotten soft. It is hard living separate lives, and my homes couldn’t be more different. Part of my life and my year is in Kuria, Kenya and part of it is in Orange County, CA. I thought that it was a challenge straddling Europe and the US for a decade, but this is decidedly more challenging. As a result, Laura, my wife, and I have decided to make the best of both lives, but it doesn’t make it any easier during the transition from one to the other. 

Now that the transition is more or less complete, and I have now had a chance to reflect, I cannot help but welcome all of this daily battering and bruising, but for the sake of adventure, the grit of reality, or even for the sake of the story, but because it serves as a reminder of why I am involved with Nuru and why I have chosen this line of work. The transition back and forth is always a bit of an overload for me. When I go out to the field, I cannot help, but be struck by the level of poverty. When I return back to California, I cannot help, but be struck by the affluence. 

People adapt to their reality over time. It happens. Certain things just become normal. While I don’t feel that I have ever lost my sense urgency in our fight against extreme poverty, when it is your everyday reality, it becomes more accepted. I welcome the shock that I feel right now to serve as a reminder as to why I do what I do. 

I am streaked with mud from coming home in the rain and the neighbors’ scruffy puppy curled happily around my legs smells distinctly of the rotten vegetables from the garbage pile she was just playing in. On a normal day I would march into the house, try to de-grime myself and start cooking dinner. But it’s my last week in Kuria. The new team has taken over my cooking and water duties, I’ve handed off my Nuru phone and Aerie and I are almost finished transitioning the CED program. The puppy at my feet is not aware of these massive changes, although she will probably give me a parting gift of ringworm. After this week, my normal day may no longer involve sitting inside a maize granary to wait out a rainstorm before I can go home from work.

The rains are early this season. So planting has to be started at the same time that farmers are frantically drying maize under the uncooperatively damp sky to repay last season’s farm inputs. At Nuru, February has also been a collision of events. It’s our first go at running maize buying operations in the Nuru granary, and the Agriculture and CED programs are both involved in the logistics of coordinating 7 different buying stations. Foundation Team 4 has arrived, and transition is underway in almost every program. Finally, the first official round of JDF loans is being issued! 

7 loans were given from the Jamii Development Fund as part of loan product pilots in December, but this first round of loans truly launches the JDF. They are open to any Nuru farmer who has successfully repaid 2 seasons’ of farm input loans, saved enough money to purchase farming inputs instead of borrowing, and attended a financial planning workshop. By making progress towards independence from Nuru farm input loans, additional lines of credit will be available to these members, formally linking the JDF with our savings initiatives. For this round, loans will be available for the payment of school fees (primary and secondary education) and farm labor or equipment (hired labor, plough oxen, etc.).  

These requirements are pretty high. Even farmers with good income from the harvest would have had to do some planning to qualify for a JDF loan. This is intentional. We don’t freely offer large capital loans. I know there are differing opinions on this and I understand why many organizations try to immediately address lack of access to capital, one of the biggest obstacles to economic development. But I don’t think credit is intuitive and it’s not the only answer to economic development. As we continue to develop and expand the Jamii Development Fund as a community-led initiative, it will only become more important that our clients are trained in financial planning and loan management. On our part, we’ll need to remain responsive to community needs. For example, the timing of the rains has brought on a need for short-term loans. Since school fees and repayment of farm input loans are due before many farmers have harvested, they may be forced to seek high-interest, short-term credit from loan sharks. We are currently exploring loans that will allow members to affordably meet cash flow needs during the crucial period before harvest. 

For now, the CED managers are seated around a table wedged between ceiling-high stacks of maize sacks in the Nuru granary. The light is filtered and gray before the oncoming rain and the ground is coated with stray maize kernels. Aerie surveys the granary floor and comments “You know, if we swept up all this maize we’d probably get a sack or two.” Which is the same thing I said a few weeks ago. Must be a CED thing. Peter and Moses, who are coming along nicely in our OCD ways, are scrawling meticulous notes in their field reports. We are reviewing more than a dozen applications, but the field managers are taking the lead. They have visited the homes and businesses of the applicants to verify income information and evaluate repayment capacity. The process is clunky for this first try, but will undergo iterations and improvement in the weeks to come. I’m sad to think I won’t be here to see those developments, but I feel fine letting go of the program. It’s been humbling to work with such a great team. 

On Wednesdays at 3:00 p.m. I am usually at our regional Savings Club meeting in Nyangiti primary school, fighting sleepiness in the heat of the afternoon. Outside the window is the most amazing field of tobacco, lush, leafy and bright green. I’m kind of fascinated by how beautiful the plant is, considering the hate-need relationship it holds over the community. It is the most prominent cash crop, despite high labor requirements and negative impacts on health and environment. I asked about tobacco farming, so that I could compare it to Nuru’s maize-based agricultural program. Somehow*, the notes and sketches scrawled in the margins of my field notebook became an informal geek-out session comparing costs and labor associated with farming tobacco vs. maize. The step-by-step detail is only to compare labor requirements, so Normal People, feel free to skip to the last paragraph!

Disclaimer: This is obviously an unconfirmed, loosely technical comparison of costs of farming 1 acre of maize vs. 1 acre of tobacco, collected anecdotally from field officers. The cost of inputs includes interest. Labor was calculated in days, which assumes 1 person working 8 hours. I did not take into account efficiencies achieved by group or family farming, or comparative costs of transport.

* I don’t get out much.

TOBACCO

1. START WITH TOBACCO COMPANY-LOANED INPUTS

3 packets seed ………………………………………free

4 50-kg sacks NMK fertilizer ………………… Ksh.19,600

2 50-kg sacks CAN fertilizer ………………… Ksh.6,000

2 bags pesticide …………………………………… Ksh.1,400

2. PLANT SEEDLINGS

Dig 2 30X1-meter nursery beds. Plant, add fertilizer, and build lofted mulch covering (1-2 people, 3 days). 

Water twice daily for 1.5 months; start reducing mulch when tobacco sprouts after 1 week (1 person, 2 hours/day). 

3. TRANSPLANT

After 2 months in nursery bed, transplant and water (1 person, 4 days).

After 1-3 weeks, add fertilizer and conduct gapping (1 person, 6 days).

4. WEED

Weed immediately after transplant (1 person, 2 weeks).

After 2 weeks, 2nd weeding. 

After 2 weeks, 3rd weeding.

Top/prune blossoms or leaves will lose weight. Pesticide applied throughout. 

5. HARVEST

Harvest in 4 rounds, total of 500-1,000 kg tobacco. Each round of harvesting requires:

- Pick leaves (5 people, 1 day).

- Tie tobacco leaves to racks to hang in tobacco smoking house (Ksh.1,500 hired labor).

- Heat to required temperature specifications and monitor (1 person, 3 days, Ksh.10,000 firewood).

- Sort by grade and bale (2 people, 1.5 days).

Purchase price depends on grade. Average Ksh.110/kg including Ksh.3/kg premium for properly baled tobacco.

Total Revenue = 200kg/round x 4 rounds x Ksh.110/kg = Ksh.88,000

Total Expenses = Ksh.27,000 inputs + (Ksh.11,500 hired labor & firewood/round x 4 rounds) = Ksh.73,000

TOTAL PROFIT PER ACRE = KSH.15,000

Total Labor = 83 person-days

MAIZE

1. START WITH NURU-LOANED INPUTS

1 10-kg bag seed ………………………………… Ksh.1,265 

1 50-kg sacks DAP fertilizer ………………… Ksh.2,200

1 50-kg sacks CAN fertilizer ………………… Ksh.1,540

2. PLOUGH (1 person, 4 days)

3. PLANT

Dig hole and add DAP, cover with soil then add seed and cover (4 people, 2 days). 

No extra watering necessary outside of natural rainfall.

4. WEED

After 2-3 weeks, conduct gapping and weed (1 person, 2 weeks).

After 3 more weeks, weed and apply CAN.

5. HARVEST

Cut and stook maize stalks (5 people, 2 days).

Shell maize (2 people, 2 weeks).

Total Revenue = Ksh.20/kg x 13 90-kg sacks/acre = Ksh.23,400

Total Expenses = Ksh.5,005

TOTAL PROFIT PER ACRE = KSH.18,395

Total Labor = 64 person-days

Ksh.3,395, or US$47, may not seem like much of a difference. But for people living in extreme poverty, it can be as much as a quarter of their income. And numbers are only part of the story. Farmers in the community are well aware of the health problems associated with harvesting and fire- or flue-curing tobacco, the heavy rate at which tobacco depletes soil nutrients, and the pollution caused by heavy use of pesticides. The labor intensive nature of farming tobacco especially impacts women and children, because they bear the responsibility of collecting firewood and water for the tobacco. Knowing this, it was still difficult for farmers to give up the cash crop when traditional maize yield was 3 sacks per acre. It’s easy to see how farmers struggling to feed their families might overlook some of those costs. With the high-quality inputs and methods introduced by Nuru, average maize yield has increased to 12-15 sacks per acre, with the added benefit of lowering household expenses by growing rather than buying food. Better food security, health, income, and more importantly, choice.

Meet Chacha George, a Nuru farmer who also has a business as a boda boda (motorcycle taxi) driver. After joining a Nuru Savings Group and being trained in financial planning, George qualified for a microloan which he used to buy the piki (motorcycle) that he used to rent. Now he can increase his profits and pay back the loan. Real time subtitles provided by Nuru CED Program Manager Vivian Lu.

It doesn’t matter how they arrived at this particular number, the point is, it is finite. A thief WILL be caught. Stealing is taken seriously. Cattle, for example, are a prominent symbol of wealth and are often stolen. No matter what time at night it’s discovered, a team of trackers immediately forms to catch the thief. Walking around town between meetings, I’ll round a corner and suddenly be facing a mob of 10 to 20 angry men marching with machetes, bows and arrows. My first instinct is to dive into the bushes, but they pass with nods and greetings. They are hunting a cattle thief.  

But while theft is taboo, it is a nuanced concept. In our Savings Club program, a group of members meets weekly to contribute an agreed-upon group savings goal. An elected representative records the amount contributed by each member in the group’s notebook, then takes the total amount to a Nuru Savings Club meeting. Nuru staff issues a receipt that the representative must then show at the next group meeting to confirm that all the money was transferred. Seems pretty straightforward, but in reality the groups aren’t disciplined about meeting, the representatives often casually collect money from individual members, and no one thinks to check the group notebook or receipts. After some time, members will show up to make a withdrawal from their group savings, only to find that their representative actually stopped attending Nuru Savings Club meetings months ago. It takes some tracking down, but eventually the representative is found and returns the money. For a community that so abhors stealing, this has happened a surprising number of times. And the members, while upset, are actually pretty tolerant of the person who quite obviously stole their money. There are no machete-bearing mobs here.

So does this mean that theft, if more subtle than outright stealing a cow in the middle of the night, is somehow less severe? Misappropriation of money, if you can get away with it, is acceptable? I would say 99% of our members are honest and hardworking. Out of 82 loans disbursed to date, only 2 have ever defaulted, and both were subsequently recovered. But that 1-3% exception could very easily tear down the program for everyone else. Preventing fraud in our village bank and savings programs is a huge priority.  

We’re learning from our mistakes and trying to actively preempt new ones. We’ll be reverse brainstorming ways to break down and cheat our system so that we can prevent that from happening. And we’ll have to adopt a lot of security measures involving paperwork and checking IDs that isn’t really exciting to read about or do. It seems silly to be verifying IDs when the field officer knows the client’s entire extended family for the last 5 generations, which is often the case in our communities. But considering that there are 6 traditional Kurian names for firstborns (Chacha, Mwita, or Marwa for boys, Gati, Boke, or Robi for girls), at some point Peter Chacha or Joseph Marwa is going to figure out that there are 437 others in the bank with his name. So the un-sexy tasks of creating unique membership numbers, building a database of member IDs, setting up security protocols in our financial services, and tracking individuals across all Nuru programs are actually pretty crucial to our overall ability to sustain and scale.