First of all, Joe, and everyone else, THANK YOU for the Gift Certificate. It was great contributing to this, and I actually made the entry just because I wanted to experiment with making these digital PSAs. Although I was enticed by the Kiva Contest to take action, I never expected to win!
Well, here is the loan I invested in:
Pablo Gonzales Gonzales
He sells tacos and drinks from a rickety stand on the street, and he needs the money to construct a better stand. Why him?
- Constructing these stands in the public way is yet another step towards formalization of his business, as described by economist Hernando de Soto in "The other path". Formality will allow him to expand his business, get access to commercial loans (lots cheaper than microloans), etc.
- He NEEDS a new stand. Look at the planks he is used for table-top. It's a miracle that his large glass bottles haven't fallen off... It looks like a Mango drink, horchata, and something else in there.
- One of my Mexico loans got paid off recently, and this one replaces it
- Under normal circumstances, I would have had a little doubt to invest in this loan. The reason is that it's ONLY $375 and he'll take a year to pay it off. That means, he's going to pay a lot of money in interest. With an interest rate of 54% (as is the average rate for Admic), he will have repaid just under $600 after he's done repaying. That's a lot! Note however, that the alternatives can be worse: Compartamos, the MFI that recently went public, is rumored to have interest rates of up to 100%...
- And finally... I *love* tacos, especially "al pastor"!
So to all of you who put down money to get a gift certificate to every participant: a BIG THANKS. I thank you, and I am sure, so does Pablo.
--Ramón
