Why do we lend?

I recently spoke with Don Daniel, a small business owner, in Matagalpa. He said to me that he had recently gotten approved for a loan with a 38% APR.

 Don Daniel: "It's great deal!"
 Berly: "I think that sounds rather high. Why do you think that's a good deal?"
 Don Daniel: "The other bank would charge me 10%"
 Berly: "Well, 10% is a much better rate. That's a better deal."
 Don Daniel: "They'll charge me 15% per month."
 Berly: "Whoa! Are you sure? 15% PER MONTH? That doesn't sound right."
 Don Daniel: "Yes, that's the standard here in Nicaragua."

Don Daniel's small construction company is pretty successful. His business wouldn't meet the requirements for a PHPG loan because it's too big. His options for credit are limited. The options for PHPG  clients, are even fewer. Many work informally, and as because of this don't have the credit history to apply for a loan. They don't have wealthy friends that can act as guarantors, They don't need to borrow $1,000 they need to borrow $100.  This is why we do the work we do. Access to credit matters. It's an opportunity and a tool that is much harder to have if you're poor.

Moments in 2014!

2014 was a big year for PHPG.  We worked with farmers, artisans, and local entrepreneurs to help them improve their businesses. We distributed our 500th loan. Celebrated our 6th anniversary of working in Nicaragua. We built new partnerships.

Here are some highlights from a successful year.

The PHPG team in Nueva Esperanza, Granada.

  

Marlene, the President of the Cooperative Tierra Nutrias, shows us the Coop's grain storage and mill.

Fulgencio paid off his 3rd PHPG loan! Here he is with Executive Director, Isabel. 

PHPG Coordinator, Berly ,waiting for the bus with Nazareth, Martha's (PHPG Loan Officer) daughter.

A PHPG loan recipient demonstrating how he etches designs onto pottery.

Visiting with PHPG partner, EOS. Milton took us around his farm to see EOS technology at work.

We celebrated a new partnership! Here's PHPG Coordinator, Joe with Arlen from World Vision Nicaragua.

PHPG loan recipients and craftspeople standing next to their beautiful handmade tables.

Joe, Juan Carlos, and Steve enjoying a moment by the fire.

PHPG Fiesta in May!

December workshop with women micro-entrepreneurs in Matagalpa

The PHPG team walking the streets of Nueva Esperanza, Granada.

We're moving toward another great year!

Borrower Profile - Dalia

Meet Dalia, she's one of PHPG's loan recipients in Matagalpa. This month she received her second loan from PHPG.

Five years ago she started her small store in the city of Matagalpa. At first, she started selling pastries from her home. Dalia had been making cakes and pastries for many years, so this new store was a natural fit for her. She had only one display case for her goods. 

   In her third year in operations a large stationary store on her street closed down. People kept stopping by her store to ask about the stationary store and where they could get supplies.  Dalia saw an opportunity to expand her business. She started selling school supplies and paper goods to fill the void that the large stationary store had left. 

Before she had access to credit from PHPG, her sister lent her some money to widen the entrance to her store. Dalia has slowly added more display cases and new merchandise to her store. Now with her second PHPG loan, she plans to buy more merchandise for the coming school year (The school year starts in January, here in Nicaragua).  She is also planning to add an awning to her store so that she can move a few of her display cases outside, where they will be more visible to passing clients.

Dalia has two sons. The youngest, Alejandro, is in high school. The oldest, Kevin, is in his very first year of college and is studying Civil Engineering. Dalia works so that she can provide a better future for her sons. 

Workshop in Matagalpa!

Today we had our first workshop in Matagalpa! It was a great success! 16 women micro-entrepreneurs joined us to discuss how to improve their businesses. The goal was to think more about their businesses, their costs, profit, and operations. The women were all very active and the discussion was lively. 

Here's a taste of what we discussed:

* The importance of planning
* Steps for a feasibility study
* Analysis of expenses and income
* How to set prices & determine costs per unit.
* How to and why separate business expenses from personal expenses

Group leader Hazell at the board.

Iriz reading out-loud for us.

 Listening intently.

     

Martha at the board.

Visit to San Juanillo

Walking into the picturesque village of San Juanillo. Most of the 100 families in this remote part of Matagalpa are farmers.

On this visit we met with Yohanna, the leader of her loan group. Yohanna's family has been cultivating onions for the past twenty years on this land. Here she show's off the seedlings.

 PHPG's first loans in these area where a result of a partnership with EOS and ATDEL. EOS and ATDEL helped the women build ecological ovens. The women who received the oven use the ovens to bake for their own consumption and also to sell in town. In the picture below, Yohanna shows us her oven.  She is looking forward to making roast chicken during the upcoming holiday season.

Our Matagalpa loan officer, Martha, poses in front of the seedlings. Martha's family used to farm in the are Esquipula.Her knowledge about agriculture in Nicaragua has been indispensable to our work here.

Yohanna's group is almost ready for a new PHPG loan, which they would like to use for a new irrigation system. Their current system is labor intensive and requires digging trenches where water can flow around the fields.

Below is a picture of the irrigation system in the fields of Yohanna's neighbor. A system like this would be a big benefit to the group.