MicroSerfin - a false Robin Hood - stealing from the poorest of the poor

A few years ago I read about a guy in Bangladesh (I believe) who started to provide micro loans to the poor people. This enabled them to buy a bicycle or sewing machine or similar item, which made it possible for them to start a business providing a service, thus creating a doorway for them to put food on their table and support their family. I remember how excited I was about this idea. Oh how wonderful!

Now, Panama is not as poor as Bangladesh, but there are many people here who survive on jobs that are paying 12 $ a day (sometimes even less), and sometimes are not even providing work every day of the week. With such a dismal income, paying 30$ +/- per year for a bank account is way too expensive, of course. So most of the poorer people have no bank account - and there's quite a large number of people who fall into this category!

Without bank account, however, it is completely impossible to get a bank loan. Heck, if you're not able to bring proof of a fixed income, you can't open a bank account at most of the banks. A bank loan is just not an available option when somebody is in such position.

But, just like in Bangladesh, there are organizations in Panama, too, who are "helping" such people. Or at least they say so...

One of them is called BBVA MicroFinanzas - the parent of MicroSerfin.

Unfortunately, however, this company is engaging in predatory lending practices!

A friend of mine took a loan from them a few years ago. She made her payments in time all the time, and generally was a good borrower. When making her payment in October she got a receipt showing 1587$ as open amount. 

10th of November - total amount owed: 1,587$

In November I paid 1,500$ on her account - through online banking. 

7th of November, my payment - one month after total amount showed 1,587$

The amount was credited. However, when she tried to get a receipt, they told her that it is not possible. Instead they gave her a printout showing the 1,500$ of November registered as prepaid monthly payments for the next 10 months. I didn't think much about it, yet, and suggested that once she has the money to pay the remaining less than 100$, it will all be well.

Yeah right! When she was trying to pay the remaining amount in December (7th), she was told she owed about 500$!

She asked me how is this possible. I advised her to simply pay 10$ onto the account to get a receipt, which she then did, here is that receipt.

When we met again she showed me the receipts, and I couldn't believe my eyes! How could 1 month of owing 1587$ plus 1 month of 1,500$ less incur 400$ in interest? That's 25% interest per month! Or 300% interest per year!!!

7th of December - total owed showing as 400$ more. And a week later it's now up to 520$!

I decided to come with her to the office and try to figure out what's going on. By that time - a week later - the amount owed now was 35$ more again - up to 520$!!! (Look at handwritten note on bottom right.) Even if the 486 $ were right, that would be more than 7% of interest per week, or 350% per year!!!

I told them they are engaged in predatory lending practices, and gave my friend 80$ to pay the amount that is supposed to be open. They refused to take the 80$ but barraged her with explanations about why she's supposed to pay more, that the system is calculating this and the system is always right, and crap like this... I told my friend to not worry about any of their talk, just pay the 80$ and we'll deal with the rest after that. But they steadfastly refused to accept the money!

After fighting with them for about 1/2 hour, I told them I'll get the police for the officer to witness that they refuse to take the payment and left. By the time I got to the police station, my friend called me, telling me they are accepting the money now and I can come back without police. When I got back, they had finally stopped their barrage, and retreated into the back office, saying they'd call the headoffice to have them tell them how much she really owed. The new calculation (supposedly by the headoffice) was now 160$... Still way too much (amounts to about 5% per month, or 60% per year!)

I advised my friend NOT to pay the 160 $, but only the 80 $ - realizing, it's not going to be easy to get any money back from them. Finally (it was 5 minutes past their closing time) they accepted and processed the 80$. 

Now, check out the receipt below: They charged 18$ for management (gestión) - no other receipt has an amount in that field! These people are trying to steal more money even after realizing they were caught redhanded! Unbelievable!!!

Gestión 18.40$! What management did they do in the last week? Or is it the fee for having the audacity to question their ridiculous interest rates and predatory lending practices? 

What is really irking me is that in essence they are stealing money from the poorest of the poor people of Panama! Stealing hundreds of dollars from those who have to conserve every nickel and dime - literally! And all under the pretense of being a foundation with the mission to help that group of people! Despicable, if you ask me!

I do hope I find the energy to report them to ACODECO - the governmental department whose task it is to protect consumers.

Btw, the computer printing these numbers is an indication that this is not a simple mistake, but it is programmed into the system! It is something they do (or at least have the potential to do) all the time! And they are not even worried, because their client-base is mostly not educated enough about finances to notice that they are being robbed! 

Well, this time they messed with the wrong people... I'm curious to see how this story is going to continue...

Carriola - the universal building material for everything

 What is the 2 by 4 in the US, that's the carriola here in Panama.

Everything is being build using carriolas. Or, the other way around, carriolas are used to build everything!

At the Hostal Un Mundo it was used for the roof truss (the original purpose of existence for Carriolas). But it also was used for the columns that hold up the roof truss and thus create the second floor of the building, and to stabilize that structure.

Miguel and Brian supporting and securing Delmer (who is on the outside of the roof screwing down the latest sheet of "zinc")

It is being used as platform on real and makeshift scaffolds, as temporary support for zinc (wavey sheetmetal used for roofs) during its installation, as temporary support to lean the ladder against, and similar temporary purposes. 

Iris watching how Fernando is applying the "repello" (concrete plaster) on the outside of the wall - she's trying to learn everything!

Then, we used it for the ramp that leads to the the door of the second floor, to hide/protect the water pipes in the bathroom, and - in  little while - to create the greenhouse for our vegetables. 

Not sure if my design is good, but Delmer thinks it might work. We added a sheet of aluminum as topping, later, and a railing on both sides...

I might use it, also, to build shelving, bunkbeds, maybe even the base for the sink in the kitchen. Who knows what other purposes I might come up with...

Delmer, my trusted carriola, electricity, masonry, and welding specialist (Fernando, a local muchacho who also got some very useful expertise in wall finishing and masonry, in the background)

The idea is derived from U-beams. The simple U beam was enhanced with small lips at the opening of the U. That allows for even more stability, as well as for easier welding on the opening side of the U.

Here's a schemata of the structure:

+----+
|       |
|
|
|
|
|
|       |
+----+

The most common dimensions are 3", 4" and 6". The closed side of the U of 3" carriola is 3" wide (7.5 cm). the walls leading up to the opening of the U are 4 cm, and the lips are about 7 mm. 

Sometimes, if an even stronger beam is needed, two carriolas are welded together like this:

+----++----+                                                        +----+    
|       |  |       |                                                         |       |
|                 |                                                         |+----+
|                 |                                                         ||        |
|                 |       in some special cases like this  |         |
|                 |                                                         |         |
|                 |                                                         |         |
|       |  |       |                                                         |        ||
+----++----+                                                        +----+|
                                                                              |       |
                                                                             +----+

I already bought a welding machine. I guess, within short or long I will have to learn how to weld, too...

Hostal un Mundo

 Originally, Iris planned to rent out rooms in her house to locals. 

The hotels around here need more workers than are available in the village, so many people are commuting here to work. Early in the morning you can see several pickup trucks with the truckbeds full of people arriving. And the early morning busses (arriving at 6:30 and 7:30) are often full, too. The problem, though, is getting back home. The last bus leaves at 5:00, so those who want to (or could and would be needed to) work in the evening would be stuck here, with no place to sleep. 

Iris wanted to fill that need.

However, when trying to find accommodations for our guest-workers from Chiriqui we realized, that there is nothing available for guests on tight budgets as well. Most of the hotels are in the 50 to 140$ per night range. The two hostels in town, that are renting beds in mixed dormitories, are also almost 20$ per bed per night.

So we thought, maybe we can provide a mix of less expensive beds for guest and local workers as well. Even though the house is about 20 min walk from the beach in the village, we think, some backpackers and youngsters might prefer to save a few dollars on the bed and walk, rather than paying premium prices for 15 min closer to the beach... 

We'll see... For now, we're thinking (hoping) that between locals and thrifty foreigners, we're going to be able to have enough business to have the house pay for itself over time...

With the change in plans for the purposing, the floorplan of the upstairs changed as well. And the ideas about the landscaping around the house too.

Instead of another kitchen and 3 bedrooms upstairs, we're now thinking of making just one big room, and four toilets plus two showers for guests to share.

Instead of using blocks to build the outside walls, we're planning on using locally sourced wood on the side, and mostly glass on the front and backside.

But, all that will have to wait for now. First, we have to get the downstairs ready!

Progressing nicely with Iris' house

This week, Fernando (a young local man), and Capo (a "guest"-worker from Chiriqui) were working on the stucco of the third outside wall. Unfortunately, we did not have enough "tinta" - a color powder, which is mixed with cement and applied in a thin layer on top of the the freshly installed stucco.

I also learned, that it is important for the stucco to dry sufficiently first, before applying the tinted layer. In our case, it was already very late in the afternoon, and we didn't wait long enough for the stucco to dry. As a result, the grey of the stucco was bleaching into and through the layer of color, leaving the wall blotchy. Fernando - the specialist around this technique - thinks it might be possible, to apply a second layer of tinted cement and get the wall to be looking nice. Let's hope this is true...

Secondly, Capo started working on stairs leading up from the road to our yard. It is fascinating to see what local folks are able to do manually; And how they are able to build something quite beautiful and significant with the simplest means! 

Manually cut out of the earth

While Capo was digging the ground for the stairs, Fernando was working in the house, applying more drywall compound onto the walls, to create an ultra smooth finish, ready for painting later.

Fernando working the walls

Once Capo had the ground ready, the two of them mixed up the concrete - right on the dirt road in front of where the stairs are being built - and started to set the blocks to form the sidewall and steps. 

Public water pipes in the way

While Capo prepared the ground, we realized that two water pipes, which are supplying the neighbors down the road with city water, are running across the stairs. Well, obviously that won't work like that. Our plan is to cut the pipes off, put in detours to run them lower down underneath the stairs. 

Capo with the beginnings of our stairs

Water is currently provided only from about 7 am to about 11:30 am. Outside of these hours, you either have to make do without water, or install a tank.

For our problem it is off course excellent that  the water is tuned off from noon until the next morning every day! With that daily interruption it is easy to perform that work. There's no permit needed - one simply does what needs to be done, and if there's no disruption for the neighbors, nobody is complaining... Fascinating, this place! Everything is improvised, done manually, and so much without permits or involving utilities or governmental offices...

Importing Workers

After 6 months the change in ownership for the land I bought in May still hasn't made it into the registry! Without that, I can't even apply for a building permit! So, on my project, I'm still dead in the water. 

However, my partner had started building before we even met. Step by step, as much as money became available. Given the situation, we decided to first work on her house. At least get it to a point where it is useful.

The local "tradesmen" in Santa Catalina are a mess - and that's not even enough of a word to describe their cunning ways and lack of ability (or willingness) to do reasonably good work! 

My neighbors in Camarón Arriba, however, are actually quite skilled and reliable. So we ask them if they want to help us here in Santa Catalina. We can't put them up in a hotel - these are way too expensive around here! But they are very undemanding, and very interested in making some money.

The first week, Iris' neighbor "rented out" his beds and slept himself in the hammock in the livingroom. But, when at the end of the week his girlfriends little kids came to sleep there, that arrangement didn't work anymore. 

The second week now, they are "living" on the construction site. We got mattresses (which we later will be using ourselves) and put them on top of a sheet of plywood each, which are placed on some blocks to get them off the ground. A barrel with rain water suffices for washing. Iris cooks the meals at her restaurant, and I bring breakfast and lunch to the site. In the evening they come to the restaurant and eat there.

Iris is trying to make nice meals for them. Pizza (which they usually hardly ever allow themselves to afford), fish (which, of course, is much fresher and easier available here in the fishing village, than up on the mountain in Camarón. Also, fresh fruit juices, and every now and then a soda, are not usually on their table at home.

After work, if they stop before sunset, I took them to the beach. And all of us are like little children again, playing in the waves - Santa Catalina apparently is the best location for surfing in Panama! There are lots of young folks from around the world who come here to experience these waves...

All in all, they appear to be happy with the package. 

And we are very happy, too!

Finally, there's somebody who knows what they are doing working on the house! Although the bus-trip and three meals a day add to the overall cost, it still is affordable.  And, as we're now trying to compensate for all the mistakes that were made so far, the overall quality of the construction is improving with the each new step ahead.

Thoughts about learning another language - Spanish

Once it became clear that I'd be retiring in a country where English is not the main language, I went back to school to get a certificate in teaching english as a second language at University of North Georgia (A great program, by the way...) 

Among the things I learned was the (not so) new approach of "acquiring a language", rather than the old style of "learning about a language".

I learned english and french the old style while in business highschool in Austria. Now, I'm in the process of "acquiring" Spanish, as I am living in Panama. 

I started with Duolingo and Babbel. That gave me a nice little foundation. Interesting, by the way the difference between the two apps: Duolingo is by an American company and Babbel by a German. 

Duolingo is 99.9% "acquiring" and almost zero knowledge "about" the language. Works well - to a degree - but (at least to me) becomes more and more difficult as the skills improve.

Babbel is (by my estimation) 80% acquiring, and 20% background information about the language. To me, Babbel was an excellent complement to Duolingo - once I had acquired a little foundation with Duolingo, Babbel allowed me to reach the next step.

I would say, based on my experience (which means, my style of learning, my (non-)talent for languages, and such), Duolingo by itself wouldn't work for me to get proficient. Babbel by itself might work for proficiency. But, Duolingo and Babbel in combination work the best - for me!

So, if you are trying to learn any new language, I can only highly recommend to try both apps. Start with Duolingo, as it does not have a time constriction for the free version like Babbel does. And after a while try out the free week (month?) of using Babbel. (Just make sure you have plenty of time do maximize the time you can spend with Babbel during that period!) Then decide for yourself whether to pay for the one or the other or both apps; or whether to continue without the support of either...

Well, in my case: Trying to manage the construction of a home requires communicating a lot with local workers. So within a month or two, my Spanish has improved a lot from the Duolingo and Babbel foundation. Especially the vocabulary increased - I added a lot of words around construction, of course. And also I "acquired" certain phrases to the point where they became automatic... 

Now, I can mostly explain what I want my workers to do, and inquire about why they do what they do the way the do, and solicit their thoughts and opinions on various challenges.

However, I have pretty much zero understanding of grammar. I know almost nothing ABOUT the language. 

I find this makes my continuing progress much, much harder!

I now think, based on my own experience, that a combination of the "old style" and the "new style" would bring the best results. Start by acquiring, after a while catch up on grammar, and most of all, continue to "just do it" - speak the language everywhere and anywhere and all the time!

Well, if studying grammar wasn't so damn boring and hard it would be the best for me to now put a lot of focus on just that! If only I wasn't so lazy... 

Highsecurity shopping...

 My passport has about 10 or 12 pages with visas and entrance/exit stamps. But it was in pristine shape! One wouldn't have guessed it was used so much. It was!

Today, it is fading, worn, bent, and looks like it's 100 years old!

Why? Because, when in Panama, I've been told, you ought to always carry your ID with you. As a foreigner on a tourist visa it is particularly important to have your passport with you.

It is not rare, that while driving somewhere - anywhere - in Panama you turn around a curve and encounter a surprise police check-point. The first few times I was a bit worried: what do they want? How's that going to be? Especially with my very rudimentary Spanish! But, by now, I don't even think about it anymore! It happens so often. And they always just check my passport - if I am overstaying my tourist visa. Sometimes they also want to see the car papers; but that is rather rare. And much of the time they just wave me through after a glance at the passport from the distance...

Keeping the passport always in the thigh-pocket of my pants, even though it is the least strenuous pocket on my clothes, every day all day really is putting a toll on it...

But, aside of the police check-points, there is a second type of activity that requires the passport: If you want to buy a screw at the hardware store, or anything else where they are required to write you an invoice, you have to provide an ID.

That is really strange to me! I have't encountered that anywhere else in the world. Of course, I haven't been to communistic, dictator, or otherwise autocratically ruled countries. But Panama is a democratic country. And Panama is a very peaceful place - as far s I can tell! They don't even have a military - similar to Costa Rica! 

Imagine, you have to proof your identity at Lowe's, Canadian Tire, or Hornbach, or similar. Even, when buying a vacuum or cleaning supplies, shoes or clothes, or any other item that is not edible or gasoline!

Secondly, the processes in some stores are a bit confusing, too. 

Today at HOPSA for example, I found my bolts and nuts and washers and went to the cash register - passport in hand, of course. But, she sent me back to a rep. 

He had to first enter all my items into the computer and create a "factura" - of course verifying my identity by passport control and entering the passport number. When finished entering he told me the amount I will have to pay and handed my items... not to me, but to another guy in the back! He said something to him while pointing at me, and then instructed me to go to the cash register and pay for my items. 

The girl at the register asked me for the factura number - which of course I had no clue what it was! - but was able to find the one I was supposed to pay by entering my passport number into her terminal. After paying, I received 1/2 m of paper stripe with all kinds of stuff printed on it. Some of it where my items - the names so abbreviated that it was impossible for me to tell whether the listed ones where what I really had.   

With that paper, plus a second strip, she sent me to the back to the guy who had my items. He, together with a colleague went over the list on my strip of paper identifying every one of the items and checking them off. Finally, I was handed all of my items and my 1/2 m of paper and I was directed that I may leave now... I think, if I had to find a way to make it even more complicated, it might take me a while!

HOPSA is not alone, though. Franklin Jurado - another hardware store - is just as complicated, albeit different...

Well, next time at HOPSA I'll be prepared and move through the positions of the maze like a pro!