Dear friends and partners,
Tabitha Cambodia is undergoing another change in its journey of working with the poor of Cambodia. We are in process of removing the 10% interest paid on all savings. The reason for this cannot be stated in just a few words so this newsletter is a rather longish one – one I hope that each of you will read. Thanks for your patience.
My background in community development started during my college years working with street people than 8 years in the poverty stricken slums of the Philippines, 4 years in Kenya and now 22 years in Cambodia.
The central question for me in development work is – how do I bring people out of a state of abject poverty to a decent lifestyle. There are some key values I use to determine the means of achieving this goal:
These values are in direct contrast to the situation that people are in and how they perceive themselves. When I arrived in Cambodia, 45 years of war, genocide and continuing insecurity left people feeling that somehow “I am Bad” and “I deserve this.” Their sense of self was dictated by the trauma they had lived through and were still living – there was no sanctity of life. They were all deeply traumatized and life had no value. ( I think good examples currently of what it was like back then is the current situation of the Rohinga People, of the trauma of war in the middle East and how lives are of no consequence – the bewilderment of people – why me – what have I done). People are left with nothing – something hard to comprehend as I have so much.
How can people live with only one set of clothes, or no bed or blankets or house that are just mere piles of thatch or plastic.
The answer is the process of savings with the end goal of a positive change in their lives of sorrow.
So we initially started with “pure” savings only but I had staff who came from the same poverty – the same trauma and change couldn’t come fast enough and we must do loans. Nothing I could say or do could convince them otherwise – we must speed up this development. So I agreed under three conditions to allow loans:
1. The family that received loans also had to save an equal amount at the same time
2. That staff had to collect every cent of every loan
3. The third condition was that staff themselves now had to start a savings account in the bank ( this caused havoc as none of them trusted banks – the Khmer Rouge outlawed money and so all banks were closed overnight and no one recouped any of those funds)
The purpose of these conditions was simply that we could not teach something that we could not understand and secondly that small loans often cause increased poverty as people live precarious lives with inconsistent income and cannot repay.
This worked very well; within two years the staff discovered that loans were having the opposite effect of our desired results. People were now running away from us, they were unable to look us in the eye – there was tremendous shame involved for both Tabitha and the families.
Then the magic moment happened and staff said one day – you know Janne – “savings empowers people – we should do just savings”.
That was partly due to their own enforced savings which allowed the staff to purchase items of importance to them and also to see half of the families achieving dreams. It was the families that couldn’t repay loans for whom we failed.
So we went to a savings-only system again, but it was also a time when security in the country was not good. There were regular clashes between the Khmer Rouge and the government; clashes between various warlords as well as clashes between opposing government entities. The country was a swarm with guns, grenades and rocket launchers. Any little thing could set of a major clash and every incident would send everybody back into the throes of trauma and fear and insecurity. The families we worked with and the staff were terrorized and yet we had a process that spoke of the future, of a better life.
The courage of the families daring to believe in themselves – achieving small measurable units of change truly stunned me. I believe that we should reward this courage and so in my then wisdom instituted the 10% reward as a clear recognition of the unbelievable courage it took for these families to stand up against the terrors of that time. Their courage inspired their neighbors- then inspired whole villages.
Our families also developed a special type of courage: they dared to believe that they could have a towel, or they could raise a chicken or they could re-thatch their house. The derision by neighbors and villagers at their audacity to try and do what no one else could do – none of us have towels – who do you think you are – the emotional push towards keeping the status quo truly required people of great courage.
The completion and achievement of the first cycle of savings was a traumatic experience – but it was also the stepping stone to opening the minds and awakening the hopes of others. For a number of years we were fighting a battle of the minds and souls of people – you are worthy – you can do this. And they started to believe.
Then came peace and security – except for election times and the odd underground revolt – then the guns and tanks and APCs would come out and all of us waited to see what would happen. The Khmer Rouge remnants disappeared into Pailin – warlords laid down their guns and private armies were replaced by a unified military.
With the advent of increased security – savings became a means of increasing the pace of development. It became a tool for families to plan ever increasingly bigger dreams – units of change. Every eleven weeks the question what is your next step? There were amazingly few crops or animals in our communities. The endless questions. Why not? Simple answers; “We don’t do these things” – skills forgotten through the years of terror.
They began to try and occasional disaster would strike; bird flu for chickens, swine fever for pigs, severe flooding for crops.
Even I the eternal optimist was beginning to think that nothing could ever change.
But Cambodians figured it out themselves – we must only buy pigs and chickens that are vaccinated – that took several years before there were enough inoculated animals around to become effective. During those years – sometimes there would be a time when all animals were disease free and we all rejoiced. However, bad things continued to happen. Bird flu would step in, and all of us, Tabitha and the families we worked with, would be overwhelmed again. But we would say; “We have come so far and now we must start again.” And all of us did.
And then the years began when livestock was being inoculated as a matter of course – and flooding was better understood – and the advent of water sources which guaranteed families the capacity to earn income all year round.
And boy – did these families work hard and we began to see unbelievable forward steps – from savings buying 2 laying hens – multiplying constantly to large amounts – enough to be combined to buy pregnant sows and on and on. And every 11 weeks the question was asked – what is your next unit of change – how are you going to do it – and the plans got bigger and bigger – savings, plus sale of chickens, piglets – double or triple crop yields and growing all year round – till they had it all – a good home, kids in school, plenty of food, clothing, bicycles and motorbikes and electricity from car batteries.
Not all families moved at the same pace nor in the same way – some wanted dishes and towels and beds before income generating activities – others decided income first and then things – the beauty of the program was that everyone has the right to choose which path they wanted. Every achievement was and is celebrated.
Our measurement for graduation was that a family could afford to have a wedding or a funeral without going into financial ruin.
Yet graduation was not very well accepted – families had become used to having us as cheerleaders – asking what’s next and how are you going to do it – yet the 10% interest prevented us for allowing them to stay – it adds up to a large amount of money.
And then the past two years our next major challenge was the advent of widespread microfinance (loans) programs – programs that enticed people with easy money without understanding that there was a regular repayment required – nor that collateral of land and house was serious.
In the past borrowing from friends and families was the norm in times of need – now there was easy money and anonymity – no one knew these people – the old structures were being replaced with new ones.
In addition, the 10% interest was a seen as a great investment opportunity by some of our families and some of our staff began to sell the “savings program” in that manner.
And the problems grew – at first it was a Tabitha manager being verbally abused by families who were in savings but had taken a loan as well – and the creditors were there at the same time.
The families screamed at the staff for not helping. Several families from our program had borrowed money from micro finance to raise chickens – large numbers of them (20-to 50) USD$100 to 200 worth – the chickens has all died ( don’t know from what) and the families were now being hounded and in danger of losing their land and house. Tabitha must help them. These incidents began to become regular in a number of our project areas. The staff and families were being stressed.
What had we done wrong?
In its most simplistic form, some of the staff had forgotten how to teach financial planning, and had forgotten to teach people; “What is your next dream”, “What is your next unit of change”, ”How are you going to achieve that?” Instead they were using the 10% as a means to entice people to save but not for change.
The second aspect was the alarming rate of how people were losing all that they owned over something so simple as borrowing for chickens ( 5 of our former families – they are gone now – land, house belong to creditors). So many of our families had become middle class families by starting with just a few chickens that multiply at an alarming rate – how could we have let this happen. Did we become lazy and comfortable in our work?
So we decided that we must change out ways – that we were losing our effectiveness – and the best way would be to do away with the 10% interest payment. This would refocus all of us on the real purpose of our work – bringing people out of poverty through the tool of savings by which people could think again clearly about the changes they want to make.
We have been told endless times over the years – by innumerable families – that our great gift to them was the ability to think again – to plan – to move forward. In recent years the 10% interest had become the end goal rather than the reward it was meant to be. We suspect that this was true for half of our families.
So we decided to remove the 10% interest and refocus all of our families on the real task – that of development. Each of our families are having this explained to them. This brought out the problem of “ghost families” – of families who were saving large amounts of money under the guise of being a number of families. It is an education. It is an ongoing process that will take several months but good things are coming out of it all.
Without the 10% interest we can reach more people about financial management as the cost will not skyrocket – so several things have happened.
First is that families who have been graduated a number of years ago – desperately want to rejoin the program. Why? Because they are at the same level of development on the day we graduated them – they want to move forward.
What is even more exciting is that it’s just not the parents who want to save but children within the family want to save for their own dreams – their own units of change. How good is that?
Are some of these units worthy of attention? For example; “I want to save for a new dress” asked by a young lady. YES, because she is worthy of it and she is developing the skills to be able to plan her future life.
I thank my God for the privilege that He allows me to do this work – to always think about what we are doing and why we are doing it. I thank Him for each of you for standing with us and the people of Cambodia. How good that is!
Director and Founder