When Borrowers become Lenders, and Heroes in the process

Yuryi and Tatyana Syomkin own an auto parts and body shop in the small village of Mikhailovka, Ukraine. They’re the only business in the area that can provide quality auto parts and vehicle repairs. Last month, the mayor of a neighboring village called Tatyana when their school bus broke down. The mayor asked if Yuryi would be willing to fix the bus on credit, the village government wouldn’t be able to pay the Syomkins for the job until later. In such a small community, Tatyana told me, it’s hard to say no when you’re asked for help. Not to mention when the mayor calls and asks you to fix the village school bus. And so Yuryi and Tatyana obliged, as they always do; they’re still waiting for the 7,000 hryvnas they’re owed for the job.

As a Kiva Fellow, I’ve traveled to 5 different towns and met 18 Kiva borrowers throughout Ukraine. Not one has failed to mention the “crisis,” by which she is usually referring to the economic collapse that occurred in Ukraine nearly overnight in October 2008. A rare few have told me, 2008 was no crisis! Ukraine has been in a 20-year long crisis… by which they are referring to the collapse of the Soviet Union and subsequent economic woes and unemployment that continue to plague the largest nation within continental Europe.

Either way, crisis is the operative word.

An important indicator of Ukraine’s recent steep economic decline is the devaluation of its currency. Within months Ukraine’s hryvna went from 5:1 to 9:1 compared with the US Dollar. A year later the hryvna has currently stabilized at about 8:1 USD.

One of the hardest-hit populations hit hardest by this currency devaluation was small business owners. Small business owners don’t have huge margins of profit. They also rely on customers who generally don’t have huge expendable incomes. In an economic crisis, the small business owner is hit twofold, both by the rising price of inventories – which are generally valued in dollars but purchased in hryvnas. In addition, they’re dealing with the shrinking disposable incomes of their customers, also caused largely by currency devaluation. These factors create a simultaneous need to both raise and lower prices in order to stay competitive and in business.

Ukraine’s small business owners have been squeezed on both sides. Providing small loans of their own is not an uncommon way for these businesses to stay afloat in such difficult circumstances. “We have lots of borrowers,” Tatyana Syomkin told me.

The Syomkins have also made loans to the village hospital. They call needing help with the ambulance and parts for the other vehicles, Tatyana says. We help, she told me, “but the money is still not in our hands… We all know each other, we have to help each other.”

Despite the strain this puts on Yuryi and Tatyana’s family business, you might say these folks are heroes. Where would the village be without a school bus and an ambulance? Sitting in their shop, looking around at well-stocked shelves run by Tatyana, Yuryi, their son, two daughters, and their son-in-law, I marveled at the Syomkin family’s strength. And the Syomkins aren’t the only ones making loans. A week later I traveled to Kherson and met Dina Avanesova, who told me that a large portion of her “sales” this season have been loans or lay-away deals to customers with dwindling disposable incomes.

I like to think of Kiva lenders as heroes in their own way, who with a small loan can change a life or even a community. It occurs to me that Kiva’s borrowers can have that same power – they are themselves experienced lenders who, like Yuryi and Tatyana, work in small communities where a loan is often more than a loan, it can be a helping hand to a friend or an act of heroism in a community.

Leah Gage is a Kiva Fellow serving in Zaporozhye Ukraine with Kiva field partner HOPE Ukraine/Nadiya. To make a loan to borrower (and possibly fellow-lender) from Ukraine, click here. To learn more about the good work HOPE Ukraine does to support borrowers like Yuryi, Tatyana, and Dina, join the HOPE Ukraine lending team by clicking here!