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Old 03-10-2003, 07:23 AM
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Coffee credit bails out rural farmer, by James Kila

DIMIAS SAPOLIK remembers quite clearly the very first time he stepped into a bank in the urban hub of Wewak, the provincial capital of the East Sepik province.

This rural dweller from the hamlet of Wambak in the Maprik area found the interior of the building a rather unfamiliar environment – a new world.

Although, Dimias has traveled to Wewak on a number of occasions mainly to visit wantoks or to purchase basic items for his family he has never gone into a bank. His initial notion about banks was that the institution was only meant for the elite, business people or people who wear good clean clothes. People have even told him that bank policies in PNG have no room for a grass root like him.

“When we took him there for the first time, he found it quite difficult to communicate with the bank manager at the Rural Development Bank” CIC officer Brian Kuglame recalls.

“Dimias was sweating all over. He found it hard to speak so we had do it on his behalf most of the time because in the first place it was us who took him there,” Mr Kuglame added.

Dimias’s greatest break-through in his life his recognition through the Smallholder Agriculture Credit Scheme (SACS) under the Coffee Credit Guarantee Scheme (CCGS) managed by the Coffee Industry Corporation Ltd (CIC). The scheme has enabled Dimias to obtain a loan directly from the bank without conventional security to support his coffee project.

Additionally, he was able to share the benefits of the scheme with his family and that motivated him to spend more time and effort in coffee production.

Dimias hails from an area in the Sepik plains where self-sufficiency in food production is a priority for the rural farmers. However, coffee farming is an important activity throughout the year. Even when prices are poor, growers need cash and thus keep farming.

Dimias acquired a first loan of K1,291 in March 1997. An interesting thing about Dimias was that he left all the money in his passbook account and only withdrew the initial amount to purchase a coffee pulper, although the credit was provided to farmers who have genuine needs with lines of credit in coffee rehabilitation and quality control. The unused amount was untouched and kept all the time in the account.

Additionally, being a wise farmer and acutely conscious of the loan he sought he only utilized funds from the sales of his coffee produce to finalize repayment of his first loan in September 1998.

During the time he sought his first loan Dimias was managing a 1.14 hectare of robusta coffee. However, between the period of the first and the second loan the hard worker with sheer determination and commitment to work remarkably increased his plantings – the size of his garden expanded.

When the second loan was approved in November 1999 he was already looking after 2.62 hectare coffee plot. That consequently warranted the second loan of K5,323.

Dimias’s second loan was considered special by the CCGS because he has successfully finalized his first loan and decided to apply again. Dimias was treated special using CIC EMM Number and former loan account number as reference. This approach was taken to seriously and confidently mould the farmer to conduct serious coffee business with banks.

Mr Kuglame recalled quite a colorful second meeting with Dimias during his review and assessment trip to the province.

Dimias was returning from a haus-krai or traditional mourning place when the officer met him on the way. The farmer was carrying an improvised carry-bag made of yellow 10-kg Trukai rice sack. The pair exchanged greetings, then the officer proceeded to explaining the purpose of his trip.

“I was rather surprised upon seeing Dimias instantly taking out his passbook when I asked how he was doing with his passbook account,” Mr Kuglame said.

“In the process of taking it out I noticed that it was neatly wrapped in several layers of coverings consisting of three 1kg rice parcels covering both ends of the book so that rain or spillage of water can not penetrate. The final cover to reach the passbook contained a patient card to the hospital belonging to him and his wife.

“He even took great care when he gently removed the cover,” Mr Kuglame recalled.

Upon finally producing the passbook, Mr Kuglame noticed from the balance that there was K916 credit as indicated.

“I asked him why he was having all that money still in the account when he was supposed to be using it for some worthy cause. However, the villager humbly responded that his intention to keep some amount of money in the passbook was based on three motivational goals he had set for himself.

These are what Dimias said:
  • “Dispela dinau yupela givim mi ya, em olsem kago bilong mi. (The loan you have given me is a valuable possession. He adds: “I am hardly recognized in my community because I am such a short person in stature. But what I have now in my passbook is a possession that is giving me some status in the community. There are some people in the community who don’t have this kind of money.
  • He explained his second goal something like this: “I am illiterate, but the loan you have given me has enable me to fit well even into the shoes of those educated people who work in big offices for their fortnightly wages. While I work in my coffee gardens to get an income to support my wellbeing. I am happy the government is able to think of someone like me to start such as scheme like this. The government probably has recognized my effort and has assisted me to pursue my dream for success in life.
  • “I don’t usually eat my breakfast before I go out to work in the gardens. When the sun becomes too hot during the mid-morning I go to rest under the shade to regain my strength. Just to pass time while sitting there I always have that tendency to flip through the passbook.
When I do that it inspires or motivates me to continue to work hard and build on my bank balances,” he said.

Mr Kuglame explained that even during the time Dimias opened his first passbook account at the PNGBC (now BSP) he had to overcome certain obstacles to really convince the bank that he was a genuine customer.
Dimias’s initial deposit of K300 was from the sales of his coffee in which he collected K688. Mr Kuglame had to accompany him to the bank as the villager had absolutely no idea as to how to open up a passbook account.

Mr Kuglame had earlier informed him that all proceeds from sales of coffee should be deposited into the joint account that was originally established to keep trend of past performances. Unfortunately, Dimias used the other K388 for coffee development purposes and was left with the remaining K300 which was deposited into the account to repay the loan at the RDB.

The bank teller at the PNGBC (now BSP) was confused. He was quite adamant and saw that there was no logic in depositing the money and at the same time withdrawing it.

Mr Kuglame, being a former banker himself explained the procedure and notified him that Dimias was a trusted customer he should be relied on. He even convinced the teller that the K300 deposit transaction should be left for the sake of record keeping indicating a trend of financial ability in his account. The bank should also consider that the passbook was Dimias’s only reference at the commercial bank or any lending institution.

Although, it took a fair bit of time the bank teller eventually was able to realize the logical arrangement was.

Today, Dimias is a model robusta coffee farmer in the Maprik area. He has further developed his coffee planting and his bank account is flourishing . Importantly the living standard of his immediate family has improved. Recent reports have also indicated that Dimias is constructing a permanent house, one of the first in his locality.

The CCGS scheme has greatly benefited this unprevileged person who hails from an area where the robusta coffee price is usually at its lowest and market accessibility is a problem. However, despite this Dimias has illustrated that he is genuine model coffee farmer striving for prosperity in life.

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