Opening the Doors - Week 1: 22nd - 26th June 2009

On the morning of 22nd June, we had a prayer to ask God’s blessings on our work. We then took a group photo of the MAKAZI BORA staff before opening the office to the public. We guessed that we might register around 15 people on the opening day. Before long, the people started coming in large numbers. We left credit officers out on the front porch wearing MAKAZI BORA t-shirts. As they started talking with people, more would come to join to see what was going on. From time to time we sent out a few credit officers with brochures to distribute them and do promotion out on the main road and near the bus station. There were many visitors on day one and lots of interest and excitement, but no one actually registered.

On day two, our Regional Director Ezekiel Esipisu was visiting from our Area Office in South Africa. Ezekiel is a Kenyan, so we had him arrive on his own on foot as a potential customer. He did his best to hide his Kenyan Kiswahili and met with a credit officer who explained the product and processes to him. The credit officers were quite surprised when we introduced the “mystery customer” as the director of all of the Habitat programs in the Middle East and East Africa! Shortly thereafter, our first client registered, receiving client number 01-000001. Unfortunately, our technology failed us and we were unable to print his ID card.

People were definitely interested in the product and we saw a number of people coming multiple times, first on their own and then bringing their friends. People were hesitant to commit, however. What appeared to be pyramid scheme had recently been shut down by the government and then collapsed with many people’s money. They were justifiably suspicious of any new financial service, particularly since it is necessary to pay loan insurance and a security deposit of 8% of the loan amount prior to having one’s loan disbursed. What guarantee would people have that we would not keep their money without ever disbursing their loan? We could re-assure them with our history in Tanzania since 1986, but ultimately we don’t expect the skepticism to truly subside until a few confident people have received loans.

As the first people registered and began completing their loan proposals and application process, we found that many did not have sufficient collateral. We use chattel as collateral, such as TVs, radios, and similar items, but it is not always sufficient to cover the exposed loan amount. Many clients will have to use a combination of chattel and guarantors, with an emphasis on our part in ensuring ability to pay so that as much as possible the chattel and guarantors do not have to been used.

Another clarification that was made during the week was the use of residential licenses. We had discussed using the license as collateral. At this point, we decided just to use it as evidence of land security and not attempt to convert the residential license into a firm collateral.

Midway through the week we decided that we should be keeping track of how many people had come for explanations of the MAKAZI BORA loan. By that time, credit officers were meeting with potential clients in their offices, rather than out on the front porch. Each credit officer now maintains a contact sheet of all people who came for information. On the 25th and 26th of June, 97 people were recorded. By the end of the week, a total of 21 people had registered and received their ID cards and welcome packets. 4 of them had completed loan proposals for assessment the following week.