Women Enterpreneurs in Burera District...

[Sarah, Lending Team Leader, Jean Claude, Lending staff reaching out to Butaro, Clement, Musanze EBU Leader....... Beautiful Lake Burera on the way to Butaro]

On Friday, August 27th, Kristin and I visited our clients in Burera District. Daniel, Transformational Impact Manager came along to interprete for us.

Burera District is north of Musanze bordering Uganda. It has Lake Burera, a beautiful lake that deserves the national attention for tourism as the road conditions improve.

We chose to visit Burera because OI Germany has raised funding from its supporters to help expand our outreach towards the women enterpreneurs in the area. Out of over than 10 sectors in the district, we visited Butaro Sector where our lending staff Jean Claude is serving 5 groups, totaling 170 clients. 93% of them are women.

When we arrived in Ruhengeri, Musanze District's capital, we sat down with the lending staff of Musanze EBU (Entrepreneurial Business Unit) and discussed about the challenges that the bank is facing and how Musanze EBU is doing relative to other EBUs. They made a few requests and asked a few questions. I was able to respond to some immediately and encouraged them to keep up the good work.

On the way to Burera, we visited a few clients who are running micro businesses.

[Woman at the kiosk... Woman selling sorghum drinks... Man running bicycle part shop...

Man owning a multiple store... as a barber ...... also charging batteries and cell phones...]

One lady owns a little kiosk by the road selling some agricultural crops and grocery items. She has been working with UOB for the past 6 years. We bought some grocery items from her and I will never forget her big smile.

We also visited a little shop where the owner was conducting multiple lines of business. He was charging cell phones and batteries for others, but he was also cutting hair for others. At the corner, he had a TV that is showing gospel music loudly to share the gospel to those who are visiting the store or passing by.

Another woman was making sorghum drink in a drum barrel and sell it. She said that she was generating RWF20,000 ($38) in revenue on a daily basis. Another man was running a bicycle part retail business together with his wife. He has six children and because of this loan from UOB he is able to feel and raise the children. All wonderful stories of microfinance!

The road to Butaro was quite challenging. From Kigali, we drove two hours to reach Rugengeri, Capital town of Musanze District. From there, we had to drive almost one and half hour pretty much on an unpaved road. Not only unpaved, the road was narrow, bumpy and very winding around the Lake Burera.

[Clement making introduction and teaching ... predominantly women clients listening ... One of five women sharing their testimonies]

When we arrived, more than 60 women gathered and greeted us. After Jean Claude made the introduction, Clemente, the Musanze EBU (Entrepreneurial Business Unit) leader introduced us to them. One of the committee members read their requests and challenges. Five women clients shared their testimonials about how microfinance has helped them improve their lives.

It was my turn to speak. They expected me to respond to their requests and to hear more good news to them. Among the requests, they hoped to have calculators for the Treasurers. I promised to supply them. They also asked for T-shirts and bibles for all members, which we could not promise. But I shared with them our plan to roll out micro leasing, micro insurance, motor cycle loans and agricultural finance, to each of which they responded with applause.

It was greatly encouraging that we were reaching out to them in remote distance, but I felt uneasy about Jean Claude reaching out to them on a motorcycle every week through the challenging road.

On the way back, I prayed that the good Lord would give us discernment and wisdom to address the issue of our lending staff having to carry the cash for loan disbursement and repayment collection. We are still hoping and dreaming to relieve our lending staff from handling cash by the end of this year. Oh Lord, please hear us and grant us your grace. - Jeffrey

Alliance Agreement with KCB Rwanda Singed!

[Maurice, MD of KCB and Jeffrey signing the agreement... Shaking hands... Together with senior officers]

On Wedensday, August 18th, UOB and KCB Rwanda finally signed their Alliance Agreement. KCB Rwanda is the subsidiary of the largest commercial bank in Kenya. It is a bank that is focusing on corporate and SME banking. KCB has operations in Kenya, Uganda, Tanzania, Southern Sudan and Rwanda.

The purpose of the alliance is to promote business cooperation between two institutions in branch banking, treasury, credits and electronic payment systems. Two banks are least overlapping in business strategies and branch network. Meanwhile, both KCB and Opportunity International share the common market territory in East Africa. OI also has operations in Uganda, Kenya, Tanzania and Rwanda.

Initially, both banks will focus on branch operatins and treasury for cooperation, but their focus will shift to sharing branch facilities so that both bank clients can use the other bank's branches for cash deposits and withdrawals. This way, both banks may not have to overlap their branch network georgraphically since the branch network is costly to establish and taking long time to break-even. Moreover, both banks will pursue the sharing of their mutual network for electronic payments throughout the East Africa Region. This could materialize in 2011.

This type of alliance is the first case in Rwanda. Both the central bank (BNR) Governor and Vice Governor welcomed our alliance, and they wished more banks were doing it. May this case pave the way for future alliances so that the Rwandans may have more convenient access to banking services faster. Additionally, banks may achieve their sustainability sooner and provide additional services faster. - Jeffrey

A Premier Micro Individual Loan Case...

[Photos from Top to Bottom and Left to Right: Cooperative Sign and President Juvenal, Vice President Immaculee, President and Kamari (UOB's Director of Lending), an old fashioned equipment that puts the cap on the bottle one at a time, Workers, and another sign photo]

On Tuesday, August 17th, I visited a cooperative that is producing fruit drinks sold to supermarkets, restaurants and regional wholesalers. It is called COATTRACO-PROBIO. The purpose of our visit was to see if their request for RWF10 million (US$16,700) makes sense. UOB has never made this big a loan to one borrower and I took along with me a couple of staff who are involved in individual lending for the training purpose.

This cooperative was established originally by 11 members and 14 additional members are now making their contribution to be members of this cooperative. Into the cooperative, members have so far injected RWF12 million and the cooperative has been operating without any debt so far. They reported annual sales in 2009 at RWF32 million or US$54,000. For the first six months this year, their sales was only RWF12 million mainly because the government agency overseeing all cooperatives in Rwanda, called Rwanda Cooperatives Agency (RCA), put a control over its activities because its original certificcate of license allowed only farming. But it has since obtained approval to be able to carry out the fruit drink processing busiiness without any further restriction. COATTRACO-PROBIO produces passion fruit concentrates and dilluted drinks (60% of sales) and local wines using berries. They plan to also produce banana and pineapple drinks.

This size of business is clearly beyond a micro enterprise that we mainly target to serve. It falls into a small to medium enterprise (SME) category. We are not actively pursuing this type of clients, but we need to strengthen our lending staff's capacity to be able to analyze and serve the businesses that are graduating from micro businesses. At UOB, we call these clients Premier Micro Individual Loan (MIL) clients. So far, the largest borrower who has graduated from micro enterprise is now borrowing RWF8 million. This client's first loan was only RWF20,000 or US$35 in 2002. It is an excellent example of impressive economic transformation. This particular client does not want to go to other commercial banks even if she is well qualified because she appreciates UOB's assistance when she needed it most.

The President of COATTRACO-PROBIO, Juvenal, plans to increase the monthly sales from the current level of RWF2 million up to RWF7 million, only if he can buy an extraction machine and install the power to the processing plant that he owns and leases to the cooperative. Currently they are using an extraction machine for home use. The machine will cost the cooperative approximately RWF6.5 million and the power installation approximately RWF3 million; hencethus the request for a RWF10 million loan. Once the power is brought in, its neighbors will also benefit from the power, thus lowering the burden for the operating expenses.

Out of the business, they can generate a net profit of approximately RWF800,000 a month with which they should be able to pay back the loan over 24 months even at the current sales level. Once the machine is put in place and the power is brought into the plant, Juvenal and his vice president Immaculee are confident in increasing the sales further. Currently they have 40 accounts and are not selling to those that ask for a credit term. Juvenal proudly explained that they turned down an order from Laico Hotel, one of top class hotels in Kigali, because they could not produce the products fast enough.

Juvenal and his wife will guarantee the loan and also pledge their building that is worth at least RWF20 million.

Juvenal looked competent and was confident about his business. He is proud that Rwanda National University, the best school in Rwanda, sends its students for internship at his cooperative.

We left the place with more confidence, but we will discuss again and make the decision on Monday next week. There are a couple of lingering questions in my mind... In the worst case scenario of not making the loan, however, Kamari and Pacifique (not shown in the photo) have witnesses how they can produce pro forma balance sheet and income statement solely based on information obtained from questions to validate them against the financial statements. - Jeffrey

Presidential Election in Rwanda...

On Monday, August 9th, Rwanda held the presidential election. Four candidates were in the race, but nobody questioned Paul Kagame's re-election. The question was how much support will he win? The preliminary result shows that Kagame has won approximately 93% support with the second runner-up winning only a 4.7% support. It is going to be a landslide win for Paul Kagame.

The international media, however, seems very uneasy about several incidents that have taken place during the time period prior to the election.

One of Kagame's former close aides, General Kayumba fled the country and was almost killed in South Africa. Deputy President of one of the opposition parties was hacked to death by a river. One media reporter was shot to death in front of his home after he wrote an article criticizing the current government's oppression on freedom. Of course, Paul Kagame and his government deny any involvement in all incidents. A Hutu female leader, Ingabire, and her party were denied for the party registration and she was placed on house arrest during the election time based on the charges of "divisionism" and genocide denial. She claims that the election did not have true candidates for the people to choose from. Some people say that many civilians were mobilized to register to vote and to show up at the Paul Kagame's campaign.

In summary, several international media claims that Rwanda has serious oppression on the freedom of people.

The media is asking questions if the freedom can be sacrificed for the efficiency or economic development.

I do not know how truthful the news media's claims are. But I can tell a few facts with reasonable confidence.

First, if the citizens did not have true choices, they did not have to vote for Paul Kagame. There were other candidates. The candidate issue seems not so convincing.

Second, I have seen many people who are genuinely happy about Paul Kagame's re-election as President. These are people I run into at the market and in the villages. If their smiles and happiness are disguises made in fear of retaliation, they must be excellent actors and actresses. The number of people who are genuinely happy about his re-election seems to be at least the majority. That is enough for Paul Kagame to be Rwanda' president for the next seven years. It is the fact.

Third, I have been hearing some inside stories about the people who have been opposing Paul Kagame. Without going into details, there were reasons behind several incidents that have happened and the rationale sounded pretty reasonable to me.

Fourth, I was born and raised in S. Korea in the post-Korean War era. I experienced the poverty and also the economic development. I also experienced the "dictatorship" and lack of freedom firsthand. I did not like it when I was undergoing it so I participated in the student demonstration against the dictatorship. Looking back, however, Korea achieved significant economic development under the so-called "dictator" who led the country as President for 18 years. Even after his unfortunate assassination by his security chief, there were two more military general turned presidents. But the presidency was transferred to civilian presidents peacefully and now the current president is the fourth civilian president in S. Korea. There was tension between the military power and the president's cabinet initially, but now the military forces subject themselves to the chief commander of the country willingly and gladly. S. Korea is now a democratic country even under the "cease-fire" state facing the constant threats from its northern counterpart.

My point? I fully understand and agree with Paul Kagame's statement and that of S. Korea's former president Park Chung Hee, (President Kagame reminds me of Park Chung Hee in many aspects) in that the western style democracy cannot be transplanted to Rwanda or Korea, respectively, the way it is in the western world. It needs to be contextualized. I interprete that as "It will take time until the full democracy will be implemented because it will take time until the citizens collectively gain independent minds to think and decide on their own who their leaders should be without feeling threatended no matter what."

The fact of the matter is that Paul Kagame has been re-elected with the landslide support for the next seven years. I think Rwanda needs him at least for now. There are so many projects and programs under way and Rwanda cannot afford a change at present. His strong leadership with solid principles and discipline is essential for Rwanda to continue the transformation that has already taken place in this small African country.

I personally admire with deep appreciation Paul Kagame and what he has done. It is remarkable and impressive in short.

Nonetheless, I have a few prayers for Rwanda.

First, I pray that Paul Kagame's leadership will stay on course for the rest of his term with zero tolerance for corruption, enhanced focus on education and health, investor-friendly business environment, private-sector-driven economy, transparency, responsible governance etc.

Second, I pray that Paul Kagame will focus on developing the next-generation leadership so that there will be competent candidates to run for presidency as his successor. Many great leaders failed in this regard. I am reminded of an axiom: "Success without succession is not genuine success." May this not be the case for Paul Kagame.

Third, even if Paul Kagame remains on course as a clean and exemplary leader, he should not neglect the responsibility of surrounding himself with only like-minded people. Many great leaders failed at the end of their tenures, not necessarily because of their own faults but because of the mistakes or bad decisions made by their own aides/lieutenants. May this not be the case for Paul Kagame.

Like many others, it is my sincere prayer that Rwanda becomes a model African country in all aspects. For this purpose, Rwanda needs God's mercy and grace. Without them, there will be no true redemption of Rwanda and Rwandan people at the end. Oh, Lord, be merciful and gracious to Rwanda. - Jeffrey

P.S.: The election day was a public holiday. I am not used to it, but I can understand and accept it. But the following day, Tuesday, was also declared a holiday in the Monday evening. The reason? Because people were celebrating Paul Kagame's re-election with Kagame's family at the national stadium, called Amahoro Stadium, until 5AM in the morning. So it became a holiday. Does it make sense? Well... I am still learning. So should Rwanda.

But Will It Make You Happy?

Happiness... is what everyone is seeking in life.

There are many signs that point to happiness. But will they make you really happy?

Among all the signs, materialism or consumerism is a formidable one. The more you have, the happier you will be. The more you spend, the happier you will be, they say.

Really? Will it really?

Things do not make us happy, but many of us live in an illusion that they will. They may make you feel happy for a while, but it does not last very long. Unlike the signs, there is not really "joy and peace" in consumerism or materialism. The illusion that you feel happy may continue for a while if you keep buying new things, better things and more expensive things, but it won't last for ever.

The New York Times (August 8th, 2010) had an article related to happiness. Its heading was "But Will It Make You Happy?"

This article starts with a story of a young couple who realized the illusion about materialism and consumerism early on and they have changed their life style drastically. They earn less and possess less than before, but they are definitely happier than before.

Happiness does not depend on how much you possess or how much you spend, but on how you spend with what you have.

This way of thinking seems to become a new norm among many people, the article says, even among young people. So true. That is why they choose to pursue a simple life.

Materialism is tempting us to pursue owning a lot of things, probably expensive and brand name things that many believe shape our social status. This belief causes us to activate greed within us. But, Luke 12:15 tells us to resist all kinds of greed because our life does not depend on how much we possess.

The truth will set us free (John 8:31,32) ... not only from the bondage of sin... but also from the bondage of things or stuff in which the world will tempt us to believe while we are living in the world. The scripture is clearly saying, "Do not love the world or things in the world for we are not of the world."

The New York Times article, linked below, does not have any spiritual implications, but it may help you discover a bit of truth to the corelation between material possession and happiness. May it be the case for you. - Jeffrey

http://www.nytimes.com/2010/08/08/business/08consume.html?pagewanted=1&_r=1&th&emc=th

Visit to Huye/Nyanza EBU...

On Friday, August 6th, 2010, I visited the Huye/Nyanza EBU located in the southern part of Rwanda. Huye is the district but also is the second largest city in Rwanda. Huye is the home for National University of Rwanda, the largest national university, thus being called the Rwanda's intellectual capital. It also has the head office for National Museums of Rwanda.

UOB's Nyanza/Huye EBU (Entrepreneurial Business Unit) consists of four offices in Huye, Nyanza, Ntyazo and Nyamagabe. It covers the largest geographical area. It had been struggling in 2009 with poor performance and rising PAR. Thus, we had to change the leadership at the EBU early this year and I wanted to empower the new leadership in front of the staff. The new EBU leader is Olivier who has been transferred from Musanze. A total of 9 people report to him and he in turn reports to Joyce, Director and Bugesera EBU Leader. Joyce is a specialist in a turnaround situation. I trust that they will together turn around the Nyanza/Huye EBU.

Also, I visited a trust group, called Dutezanyimbere. It was started in September 2008 and was about to begin its fifth cycle with 21 members. Its membership has fluctuated widely from 38 in the first cycle to 34, 32 and 39 in its subsequent cycles. In the last cycle, the group had some serious problems among some members and they had to regroup them by dropping many defaulting members and adding new members, like many other groups that are sufferring due to the slow economy.

Some members shared their transformation stories, including Domithele, Vice President of the group. She joined the group from the inception with the primary purpose of helping their grand children go to their secondary schools. She has nine children and six grand children. Her micro business of selling grocery items has grown faster than expected and she feels confident that she will be able to help her grand children pay for their secondary school fees. She was grateful to UOB and we praised the Lord who was gracious to her.

Other members also shared testimony. One young lady testified that with the micro credit, she was able to buy a cow to feed her young baby as well as to use the cow manure as fertilizer. Another young man completed his third cycle and is building up his small retail business with the micro credit. He was hoping to get a loan to buy a motorcycle for a motor taxi business. We explained about our plan to roll out motorcycle loans soon and agricultural finance later this year. They welcomed our plan and invited us back in four months when they would expect to perform better than last cycle. We also shared our plan to roll out micro insurance and micro leasing.

We shared goat brochette, Rwandan's popular food, and fried bananas over soft drinks. It was a simple meal, but it served as our lunch and probably their lunch as well. It cost us approximately $37 in total to feed us all, 27. - Jeffrey