The dusty red dirt road, the cows roaming aimlessly about the vacant soccer fields, and the faint sound of a radio singing the lyrics to “Soltero”, a pop song currently all the rage in Paraguay, were all very familiar as I walked toward a recent comité meeting outside of Villa Elisa, an Asunción suburb.
But when the capacitadora (financial trainer) I was accompanying that day began to share background on the specific comité we were visiting, she told me something I hadn’t heard before.
Many of the women comprising this particular comité were current or former employees at nearby factories. Some held two jobs as they worked to get their personal business off the ground using the microloans from Fundación Paraguaya. Some had built a successful enough enterprise by now that they had been able to quit their factory job altogether.
This was not consistent with my perception of the typical microcredit recipient, at least here in Paraguay. Based on my (albeit quite limited) understanding of the traditional female comité member, she has been previously employed only in the informal sector if at all, and the first microloan she receives likely represents her most significant foray into the business world to date. The majority of the women I had met on previous comité visits around Asunción fit more or less into such a category.
Upon our arrival at the home of Teresa, the host of this month’s meeting, I began chatting with Teresa about her own experiences. For two years, she had worked as a seamstress at a nearby apparel manufacturer. She enjoyed the work, but had always felt a desire to run her own operation.
Four years ago, while still working at the large apparel manufacturer, she joined the comité and received her first loan of 200,000 Guarani ($50 USD). She began to make her own clothes and artesanía on the side, selling small quantities from her home. As her loans and production capacity at home increased, she quit her job at the manufacturer and went to work for a smaller shop that offered more flexibility. Eventually, her loans grew enough to permit investment in a state-of-the-art sewing machine – a turning point for her business.
Today, Teresa’s business is a full-time job. She earns more money working for herself than she had ever earned from her previous jobs. She is thrilled to be able to work from home and look after her four sons – though she jokes that it’s really just her youngest son, at six years old, who’s equally jubilant to have Mom around all the time.
Teresa is an example of a microentrepreneur who truly possesses the enigmatic “entrepreneurial spirit”. She isn’t taking microloans simply to provide basic subsistence for herself and her family. She has a desire to own a burgeoning enterprise, a vision to provide her products to a growing market, and the patience to make sacrifices and plan for the long term.
Microfinance is often regarded as a way to help people build microenterprises when they have no other options for engaging in productive economic activity. But when those who do have other options turn to microfinance to provide resources for a new and preferred commercial endeavor, the future of the industry seems more sustainable, more scalable and overall, more promising.