Isabel Balderrama / KF-17 / Ecuador
The most often quoted fact by Kiva members and enthusiasts is its borrowers’ remarkably high repayment rate of 98.91% . How does Kiva manage to get this vast majority of people, located in all corners of the world, to be this good at repaying back their loans? Is it magic? No, no… The reality is simultaneously simpler, and more complicated than that. It’s a chain really: Kiva relies on its Field Partners  to get the job done, and these field partners, in turn, come to rely on their teams of loan officers to interview the clients and to educate them properly on why paying back on time is a must.
I wanted to take some time and recognize one of these keen and valuable loan officers: Ecuador-based FODEMI’s  Freddy Andrade.
Freddy’s name is well-known throughout FODEMI’s various field offices, and the story of the time he reached a praise-worthy 0% default rate on his client portfolio is often told to eager new loan-officers-in-training and to microfinance skeptics everywhere.
Mr. Andrade’s story began in 2007, when he started out in FODEMI as an intern with big dreams to help out the less fortuned among his Ecuadorian compatriots. Freddy quickly identified with FODEMI’s mission of improving people’s lives by providing financial opportunities to those who needed it most, and soon became part of FODEMI’s enthusiastic team of loan officers.
Freddy has been recently promoted to the position of Chief of FODEMI’s Otavalo Agency, and as I sat down to talk to Freddy a few days ago, it was great to see that after five years in the business his ideals and eagerness to change lives have not waned in the least bit. As a matter of fact, one of the first things that Freddy tells me is: “I don’t think any of us are here to get rich, most of us love the job and that is why we do it.”
Indeed, while the workday of a FODEMI loan officer is comprised of long hours, frequent trips to see clients in remote parts of the country, and a constant obligation to crunch numbers, most of them do it because, like Freddy, they like to see the difference that their work makes in individuals’ lives.
“So how did you do it? Reach a 0% default rate?” is one of the first things I ask Freddy once our meeting begins.
Maybe I was hoping that he would produce the “great reveal” and let me in on a foolproof trick that gets clients to pay back loans. But no, his answer is more humble and logical: “It all has to do with educating the client,” he says with a smile that tells me he’s guessed the kind of answer I was expecting. “We give the client a small loan to begin with, but we need to make sure that the client knows how to administer these new funds. I’ve seen times when the client is given greater amounts, but with no education he or she squanders it. The person should be aware that the more reliable his repayments are, the more money will be lent to him or her in the next occasion.”
FODEMI offers training on money management and financial education  and classes are held, free of charge for its clients, throughout all of its agencies at least once per week. Client education is a predominant theme throughout Freddy and I’s conversation, and it soon becomes clear that this is something that he plans to focus on during his time as Chief of Agency: “I want every one of my loan officers to reach that 0%… It will be a long process but I am confident that we will reach our goal. Right now we are in the process of educating the loan officers properly so that they properly educate our clients. I pass my skills on to them, they pass their skills on to the clients, and that is how we will reach this goal.” It’s always about that chain.
Providing borrowers with a deep understanding of the potential, as well as the responsibility, that comes with their new loan seems to be the key to getting clients to pay back, and to do it on time. This creates a relationship of trust between a borrower and a lender, and like Freddy, this relationship can grow fulfilling for both parties. “The best part about this job is seeing how my clients have prospered throughout the years,” he says with a smile, “If I give someone its first small credit, I got to see how they lived then: in a small home made of plastic. Then, after a few credits, I can see their new home and it’s made out of block. That’s a beautiful feeling. They tell me ‘I never thought I’d have my own home, but I do now, thanks to FODEMI’. In the end that’s what it’s all about, isn’t it? The service we provide our clients.”
In the years that Freddy Andrade has worked as a loan officer, he has handled many Kiva clients. I wonder what this expert loan officer’s technique is for selecting people to be featured on the website. “I picture a good Kiva borrower as someone that’s hard working and shows the will to better his or herself.” Hard working people such as Veronica’s Bendicion de Dios Group  which successfully paid back their $500 loan to purchase more pigs and feed, or Silvia’s $225 loan  that helped her buy a new bull.
To end our meeting, I ask Freddy what he thinks of FODEMI and of its relationship with Kiva, and if he has some words for Kiva lenders worldwide: “More than anything I am very thankful and happy to know that there are people out there that care, as much as we do, about our clients and to the betterment of their lives,” he responds without hesitation, “my deepest gratitude goes out to them and to Kiva’s personnel.”
And thanks also to Freddy, and to people like him that care only for the sake of caring.