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Mozkalti Group emerged as a community savings account in 2012, in the small village of San Bernardino Chalchihuapan, in Puebla, Mexico, thanks to the restlessness of a recently graduated student, Verónica Ponce Xelhua.
Vero is a 26-year-old woman who participated in UPAEP’s first generation of the program “Apuesta por un futuro” (“Bet for the future”). This program gives scholarships to excellent students from rural communities in the state of Puebla, Mexico, so they can study to obtain a bachelors degree. To obtain the scholarship, students must agree that, once they’ve finished their studies, they have to go back to their communities and apply their knowledge to generate improvements. Vero has a degree from the business school and is currently a MBA student at UPAEP.
This business model produces earnings that are employed to improve the facilities and organization of the group. All decisions that concern the cooperative are made by consensus among the partners. The earnings are also used to expand the functions of the group into other economic activities, generating jobs and increasing the number of contributors.
The main purpose of this organization is to create habits that transform the general thinking of people from this community, so they can develop a self-sustaining community.
The innovation in Mozcalti Group resides in its form of organization. This cooperative was born in 2012, so it's relatively young. While it required support from other institutions in its beginning, it has grown exponentially each year.
With the support of a program from SEDESOL (Department of Social Development), 10 female founders attended four-hour weekly training sessions for a month, so they could learn how to calculate interest, control the savings of applicants and assess loan applications.
After that, Vero and her colleagues made huge efforts to promote the project and convince people in the community to begin to save their money with Mozkalti. "From the 10 people who started the operations of the project, three continue; the desire to fulfill the dreams of our savers unites us,” Vero said. "It was a very difficult task, but when the first members began to see the results and performance of Mozkalti, many people wanted to join also."
Later, Vero signed up the project into the business incubator from the Universidad Iberoamericana Puebla, which supported it with the formalization of the organization, and helping it articulate its mission: "To create saving habits in the people of the community to improve their lifestyle and grow together." The group also fine-tuned its vision: "To become the benchmark in the community for people to save and to teach their children to save." The business incubator also helped Mozkalti Group describe its core values.
In such a small community, word spread quickly as did people's desire to become members. The organization began in 2012 with 15 members. By 2013, there were 78 partners and currently they have in their records 278 savers.
The system is actually very simple: when a person decides to become a partner of Mozkalti, they can save from $ 20.00 MXN (minimum) to $ 3,000.00 MXN (maximum) each week. With these amounts, the member may receive loans from $ 5,000.00 MXN to $ 50,000.00 MXN.
"To grant a loan to a person in the community, the first requirement that must be met is to be a member of Mozkalti and to fulfill their weekly savings deposits on time." Also, when members apply for a loan, they must present and justify the project in which they will employ the resources, and explain how they plan to recover the capital. The project must also be supported by another member of Mozkalti.
"The approval of the loan depends largely on the amount saved and the feasibility of the proposed project," said Vero. Since the project is evaluated by the operators of the project, they can ensure that the cash will be back to Mozkalti within one year, so that money plus earnings will be back in the hands of the partners by December. "The community savings account closes each year and the money is returned to its respective partner, plus earnings.”
During the first week of January, savers enroll in the Mozkalti office, on the second floor of the teal-colored house on the opposite corner of the parish of San Bernardino. Each December, money is returned to the partners. "At the end of each year we expect to experience high volumes of work, so we ask for help from our most trusted family, especially to come and count money for delivery to the partners," said Vero.
The project is very competitive with loans that can be obtained from other banking institutions, because it offers a much lower interest rate than banks to their debtors (4% for personal loans, and 2% for productive projects, since these contribute to the economy of the community). "We are very pleased with the results so far." Vero continued, "There is virtually no delinquency or delay in payments in San Bernardino as everyone knows each other in this village, and that kind of social pressure contributes to everyone’s punctuality and commitment."
Funds for Mozkalti are also collected through the small "indisciplines" from the partners: "We usually try to meet face to face with the partners once a year, especially in December to let them know how the year it’s been; when we need to buy something, we call for a special session, and each partner is told when, where and what time they are supposed to show up for the meeting. When members do not attend or show up late, they are penalized with fines ranging from $ 5.00 MXN to $ 25.00 MXN. "With these kind of actions, people commit," added Vero.
Recently, with yields that were generated last year, a small group of partners came together to launch a new project, which plans to release the first food product with the name of Mozkalti on the label: chile manzano (a particular kind of chili) prepared in vinegar. For now, they produce between 1 and 2 kilograms of this chili in the backyard of one of the members. In the future, this new connecting project will count with a much wider field to increase the chili production, so the members can launch to the market their hot product as soon as possible.
This time, they will again count on the support of Universidad Iberoamericana, which sends marketing interns to help with the design and marketing strategy for this emerging project.
Such actions demonstrate that the Mozkalti model really works, and it is focused on the auto-sustainability of San Bernardino.
Our interview takes place on a Sunday afternoon; we are in the main square of San Bernardino Chalchihuapan, in front of the parish church, sitting on a cement bench. The weather is very pleasant and we can appreciate a beautiful view of the volcanoes right in front of us. Then, in the middle of one of her many explanations, Vero sighs and points out some of the best houses that are right there in the center of San Bernardino. They are considerably larger, with luxurious finishes and painted in more striking colors than the rest of the houses.
After this, Vero explained that those houses belong to people who at some point were determined to emigrate to the United States and succeeded.
Her concern about developing the town into a productive and self-sustaining community began when talking one day with a small boy of San Bernardino; he expressed his desire to migrate to the United States when he grew up, so he could make more money and build his own house.
She believes that emigration to the United States, far from their roots and family, perhaps in illegal conditions, and only for the purpose of making more money, is a real injustice. Vero is a very committed person and feels a lot of love for her community. She wishes to erase the ideal of emigration from the imaginations of children and youth in San Bernardino, and she is convinced that Mozkalti may be the answer to come up with various productive projects that can create jobs and wealth through business in San Bernardino Chalchihuapan, and ultimately fulfill the goals and wishes for a higher quality of life in this community.
"The full name of our organization is Caja de Ahorro Mozkalti (Mozkalti Savings), which comes from Náhuatl and means to grow together." The most powerful objective of this expanding group is to bring happiness to its members and the community. Earnings are used to improve the quality of the organization and continue funding projects proposed by its partners. So far the organization has 278 active members, and the number of proposals for productive projects is increasing, as is the number of potential savers.
As its name suggests, the key is to work together. "For us, the challenge is to demonstrate that by joining forces around the world, we can achieve great results," said Vero. "During each meeting, we highlight the fact that all those present are owners and partners of Mozkalti. With this we seek to eliminate the individualistic mentality that still prevails in some people. Alone, It would be faster, but together and working as a team, we will go further."
Another of Vero's long-term goals is to replicate its model in the communities surrounding San Bernardino Chalchihuapan to reduce rates of migration to the United States and grow its economy and therefore the state and the Mexico.
Another long-term goal that has been established by Vero, is to replicate this model in the communities surrounding San Bernardino Chalchihuapan to reduce rates of migration to the United States, so Puebla’s economy can grow, and therefore Mexico’s too.
In Mozkalti, it is believed that all participants are winners, since multiple purposes are pursued. Operators can satisfy their need to work for the community, and in return they receive employment and wages. Savers gather money during the year and in December they receive their money back plus earnings. Entrepreneur partners get the support they need from their own community to see their business idea embodied, and, if the new project requires it, jobs will be originated among the inhabitants of the community.
Verónica is a young professional who has a lot of determination to fulfill her vision. For her, Mozkalti represents her life project -- she devotes all of her knowledge and professional training to its improvement and development.
The main social benefit to which this organization contributes is to generate quality of life for its members through companies and/or projects created for them, but also helps to raise awareness about teamwork and the preservation of Mexican traditions and culture. Vero explained: "In the summer, when we have more time, we offer drawing and computer workshops for the community. We also offer English lessons, or Math and Spanish summer school for kids that aren’t doing that well in regular school. For the women, we have occasional embroidery contests with attractive prizes".
At the same time, Mozkalti carries out a program for children (mainly from elementary school), who bring their weekly allowance from $ 1.00 MXN, fostering in them the good habit of saving. "When small kids decide to start saving with Mozkalti in order to make their first purchases such as toys, backpacks or shoes, it makes us really happy."
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Verónica Ponce Xelhua, founder, Growing Together to Transform a Community