An Ordinary Borrower Visit: The Reality of Microfinance in Honduras

Santiago Cortes | KF 17 | Honduras

I’ve just arrived in Tegucigalpa after my first trip to one of Kiva field partner Prisma‘s branches. I left Prisma’s headquarters on Wednesday on the back of a pick-up and drove to Danli, home to the nearest branch. My main goal with this visit was to test some policies I want to implement across Prisma. I hope to change all the processes related with Kiva, so I used this branch as a sort of “pilot branch.”

I didn’t know what to expect, Honduras being one of the most dangerous countries in the world. After a couple of hours heading south with an entire family in the back of a pick-up Toyota, I arrived in Danli in southern Honduras late at night.

The pick-up that took me from Tegucigalpa to Danli.

The next morning, I had just gotten to the office when they told me that there was a problem: There’s a new law in Honduras. Two men cannot ride on the same motorcycle because most of the murders — Honduras has the highest urban murder rate in the world — were being made on motorcycles. While one guy drives the bike, the passenger shoots without stopping, ensuring a quick escape. This is a huge problem because loan officers visit their clients on their motorcycles. They only ride motorcycles because they have no cars at this branch and I needed to evaluate the current processes.

We had to find a solution. They told me the problem is in urban areas, so I proposed taking a bus to the countryside and meeting the loan officer there and continuing by motorcycle. I went to the bus station, hopped on the first bus and left.

You can imagine the bus: chickens, children running around, a guy selling some kind of homemade Viagra (using VERY graphic explanations in his sales pitch) and the man sitting by my side eating “tamales” and “elotes.” After a half an hour, I finally arrived in San Diego, which has about five houses in it. I met the loan officer, put on my helmet, hopped on the bike and began the journey. I certainly had no idea what kind of journey!

We were immediately stuck in the middle of a herd of cows that surrounded us and wouldn’t move.

I actually took this picture one minute before we were surrounded by them.

Then we began going up a mountain. I must remind you that this whole trip was on dirt roads in very, very poor conditions. Even an SUV with 4-wheel drive wouldn’t have made it. At one point, when we ran into a river, I asked the loan officer, “Are we seriously going to cross that river in the bike?” Answer: of course! So we did, and we made it.

After an hour or so, we had to cross a huge pile of mud, and you could tell how easy it was to get stuck there: really wet and deep mud. Again, the same question: “Are we really going to give it a try?” The same answer: of course! And we did. It was way more difficult than the river but we made it through.

Up on the mountain, paths only accessible on a bike.

One of the good and dry parts of the road.

Finally, after a two-hour ride, we got to a village where some Kiva borrowers live. It was a 30-minute bus ride and a two-hour bike ride on rough roads to get to a borrower. Every time a loan officer visits one of their borrowers they have to make these kind of trips, for a $250 loan or for a $500 one. Almost six hours total (round trip, visit, quick lunch), lots of miles of dirt roads and two rivers to get to a borrower who’s asking for a $250 loan.

Sometimes these loans are to invest in their crops, or in their land to improve the harvest. But most of the time, in Prisma’s case, these loans are used to buy a solar panel to have electricity at night. These are isolated areas without electricity. For example, the borrower we visited this time had no electricity of any kind, so they can’t work at night and their two little girls can’t study after 5:30 p.m.

After an hour up the mountain — one more hour till the borrower’s house.

Finally, we made it!

This is a regular day in a Prisma loan officer’s life. It was already late when we came back to Danli, so we could only visit that one borrower. These are the difficulties MFIs face to get to their clients, and you can imagine how huge their operational costs need to be to reach these types of borrowers that traditional banks would never reach.

Walking with the borrower and loan officer to the borrower’s house. Like a minute before the “rattlesnakes warning.”

It was a great experience overall. I got to meet the borrower, his family, their two beautiful little girls, and his generous wife. Walking through his coffee plantation, he told me “watch out for rattlesnakes,” and a couple of minutes later “we have to go by a hive of wasps” (I obviously thought I was going to die right there in that plantation).

But I made it safe back to the Danli Branch — after another two hour bike ride, another two rivers, another huge pile of mud, and another 30 minutes on the bus (without the homemade Viagra salesman this time) and a shared taxi. It was totally worth it. The loan was approved, and now the borrower’s little daughter can dream of a better future.

Father and daughter walking together through the coffee fields.

Santiago Cortes is a Kiva Fellow working with Prisma Honduras in Honduras.