When tourism helps ethnic communities: microfinance touristic tours
If you were to open up an isolated community for the first time to tourism, how can you ensure a safe future for it? How do you encourage people to maintain their traditions, work and habits, while embracing tourism? This is the challenge Bloom Microventures embarked on when they wanted to bring foreigners for the first time to Phu Minh (Hoa Binh province), Vietnam.
Bloom Microventures is a non-profit organization which provides small loans to 6 ethnic minority villages in the North of Vietnam, who have little access to the traditional banking system. The originality of this project is that the loans are financed through touristic day-tours organized in the ethnic villages. Their goal is to improve the quality of life of these ethnic minorities, as well as help them to become more sufficient. For tourists, the tours are a chance to discover the culture and the history of these remote communities, and to interact with local people.
Related article: Social microfinance – the difficult road to success
How did Bloom start?
This concept of “microfinance tours” has been developed by 4 English business school graduates, and has been tested for the first time in 2011, in Vietnam. Their goal was to do tourism in a responsible way – by supporting the small-scale women farmers. The team has been working for several months together with a Vietnamese team, to start the project and find funding. In December 2012, the organization has been totally transferred to the Vietnamese team.
Who are the beneficiaries?
In their area of action, the villagers only own small farms and are mostly semi-subsistent farmers. The loans allow them to expand their farm activities, diversify their crop and lifestock portfolio and hereby improve their quality of life. In addition, a small number of beneficiaries uses the loans to open their own small business.
The standard loan cycle is one year. The loan is paid back to Bloom, which uses the money to finance either a bigger loan to the same person, or a standard loan to a new person. The first loan is of 100$, the second has an increased amount of 200 to 400$. Bloom doesn’t provide only financial services, they also offer basic farm accounting trainings – to help beneficiaries to keep track of their expenses and revenues. Besides, technical trainings in agricultural production are provided by external trainers, introduce them to new agriculture techniques which they can apply to their practices.
Each touristic tour last one day and funds one loan, and the price for the tour per adult/student is 70$/ 60$. During this day, the people meet farmers and the beneficiaries of the loan. For two and a half years, the tours were the unique activity of the organization, but last year they helped to create the first farmstay of the village, diversifying the source of incomes. The tourists can now spend a night in the village. Cooking services and tour guide services are offered to the tourist by the locals next to their farm activities. It’s not a full-time job, just few hours per week which doesn’t interfere with their farmwork. The objective is to diversify the source of incomes for the village and create new opportunities for the inhabitants in their local context. They decided to focus on marginalized community where traditional tourism doesn’t invest. For the moment, some touristic services for the tours are still provided by Bloom like the translation. However, the objective is really to transfer the skills to the population and engage them in all the steps of tourism.
What are the challenges they have to face?
One of the main difficulty for Bloom, as a social enterprise, is to find competent staff and to keep them. Effectively, there is a strong social pressure, especially from the family of the staff, to join a more established company where they can earn more money. Building a non-profit organization is a long and difficult journey and it’s not easy to find staff that stays committed in the long term. They also have to face the reluctance of the authorities, who don’t really understand their organizational, hybrid model. The area of social business is quite new in Vietnam and there still is some confusion between what social businesses and non-profit organizations are. Moreover, Bloom wants to make tourism in a different way, based on the community. However, the line between poverty tourism and community based-tourism is thin. Even if they absolutely don’t want to do poverty tourism some tourists who join the tour expect and want to see poor people when they visit the village. They try at the maximum to raise awareness of the tourists about the community based-tourism to avoid this kind of problem.
What is the community-based tourism?
Community based-tourism is a form of tourism which focuses on the development of local communities. The locals are involved in the development and the management of the tourism activities. They earn income as land managers, entrepreneurs, service and produce providers, and employees. At least part of the tourist income is set aside for projects which provide benefits to the community as a whole. It’s a form of tourism which respects the culture, the traditions and the environment of the locals.
What are their plan for the future?
For the future they want to expand their model to other regions of Vietnam. For that they need to raise more money in the next months and they have to find other areas where their model can be applicable.