Liberia: Tryin’ Small

By John Briggs, KF10 Liberia

Liberia is tryin’ small. This common expression can be heard everywhere here: it means “I’m okay” or “I’m getting by” and is the equivalent of how many Americans reflexively answer “Fine” to the greeting “How are you?”

But many in Liberia are tryin’ larger, thanks to microfinance institutions (MFIs), most of which have set up shop since 14 years of civil conflict ended in 2003. There are five MFIs of scale in the country: LEAP, a Kiva field partner which is the largest MFI by number of clients and the oldest continuously operating microfinance lender; BRAC, the ubiquitous Bangladesh-based multinational non-profit, which is well-funded and rapidly adding clients; Liberty Finance, a recently spun off project of the American Refugee Committee (ARC); LEAD, a small but growing Liberian non-profit which focuses on business mentoring coupled with provision of credit; and Access Bank, a private, for-profit German-based franchise that sports air conditioned branch offices and excellent customer service.

The nascent competition among MFIs is a good thing for borrowers. Interest rates are trending down, service is improving, and outreach is growing. But the reach of MFIs in Liberia to date has largely been limited to urban areas, and concentrated in the country’s capital, Monrovia. This is despite the fact that Liberia is a small country – as a 2003 article in The Onion correctly reports, “U.N. Factoid-Finding Mission Discovers Liberia About The Size Of Tennessee.”

More than 40 percent of Liberia’s population lives in rural areas, but steep hurdles remain in delivering microfinance services to those in the countryside. Paved roads in rural areas are rare, and the gravel and dirt roads that exist range from bad to worse, and can be impassable during periods of Liberia’s eight-month rainy season. Mobile communications are the norm (I haven’t seen a landline phone here yet), but rural coverage is spotty and outages are not uncommon. Electricity hookups in the countryside are nonexistent, and power remains a luxury even for city dwellers. And banks, which provide non-financial MFIs with the means to move and store loan funds, have scant rural coverage.

Obstacles notwithstanding, Kiva partner LEAP is committed to expanding its leadership in rural outreach in Liberia. The opportunity to serve largely agrarian rural borrowers is great, and the impact potentially profound. As part of a fact-finding mission for LEAP in late April, I got to witness firsthand how some LEAP borrowers in the countryside are helping to feed themselves, and the country, aided by the provision of microfinance services.

Cassava: Microfinance’s Role in One Community’s Staple Food Production

Jebbeh Passaway, 43, and Satta Balo, 47, both joined LEAP in 2008 and are on their second and third loan cycles, respectively. The two are members of the thousands-strong Teworo District Women’s Group, in Tiene, Cape Mount County, organized after the war to help organize and empower its members. One of the group’s projects is cassava farming and processing.

Jebbeh Passaway (L) and Satta Balo (R), clients of the Local Enterprise Assistance Program (LEAP), a Liberian microfinance institution, stand in a cassava field near Tiene, Cape Mount County on April 26, 2010.

Women from the Teworo Group propagate and plant the cassava, harvest it, and process it at a newly-constructed facility that funded by USAID. The facility, centrally located in Tiene, allows for shredding, expeller pressing, and heat drying of cassava, as well as warehouse storage for the finished product, farina. Cassava farming gives the community’s women and their families a basic level of food security, and often a surplus that can be sold at local or regional markets.

Peeling cassava in preparation for shredding.

Feeding peeled cassava into the shredder.

Collecting shredded cassava.

The end product, farina: dried, granulated cassava.

However, there are up-front costs to the women in farming and processing the cassava: farm inputs such as fertilizer, wages and food for men who weed and tend to the fields, transport of cassava from the fields to the processing station, and transport of raw and processed cassava to markets outside the community.

The Teworo group covers these costs through voluntary dues from its members. Many of the group’s members are women such as Jebbeh and Satta, who rely on small-scale trade to generate much of their income, and in turn use some of that income to pay dues to the group. Jebbeh and Satta both said that LEAP’s loans, compulsory savings schemes, and training programs have helped improve their businesses and smooth income. Satta says her main business is selling tie-dyed fabric she produces herself. Jebbeh says she sells cooked food, dry goods, and charcoal. “Whatever I can do to survive,” she says.

If the women can fund their farming activities steadily and scale up, the new cassava processing plant in Tiene holds great potential. Raw cassava spoils days after it is harvested, but properly dried farina has a long shelf life, a value-added product that’s much easier to transport to market than raw cassava.

Jebbeh Passaway (in white dress at right), a client of the Local Enterprise Assistance Program (LEAP), a Liberian microfinance institution, stands with other community members out front of a cassava processing facility in Tiene, Cape Mount County, Liberia, on April 26, 2010.

Jebbeh and Satta are enthusiastic about the current confluence of loans from LEAP and development assistance from USAID, but they need more. They said a major obstacle exists in getting cassava from the field to the facility, and getting product to market. Hiring trucks to transport raw cassava and greens, or farina, can be costly, and sometimes trucks are simply unavailable. They’d most like to see the Teworo Group buy a pickup truck.

As LEAP further expands to serve residents of rural Liberia that have traditionally had no access to credit or financial services, it is undertaking market research and studying what kind of agricultural loan products would serve the market best. Planting-to-harvest balloon loans, productive asset financing, and co-op loans are among the possibilities.

LEAP clients populate the cassava value and supply chains in Liberia. From farmers, to value-added processors, to traders and sellers at rural and urban markets, LEAP provides a number of loan products that help micro- and small entrepreneurs involved in cassava to grow their enterprises and realize their ambitions and goals. LEAP is committed to undertaking market research and study that will allow it to design appropriate and sustainable loan products to better serve small farmers in rural Liberia.

John Wrohyone, a LEAP borrower, with ground cassava greens he sells at a market in the Waterside area of the capital Monrovia on April 30, 2010.

Satta Dahn (at left), Mamie Torbor (center), and Sonni Nyumah (at right), LEAP borrowers, hold a tray of fufu (pounded cassava root) for sale at a market in the Waterside area of the capital Monrovia on April 30, 2010.

Join the Kiva lending group Team LEAP – Liberia today! And if you’re interested in seeing more photos of LEAP borrowers in Liberia that fill out the ranks of the agricultural value and supply chains, click here.

About the author

John Briggs