Shabnam and her husband take care of their family and are trying to give their children a good future. Her husband sells construction supplies. He has 12 years of experience in this business, and has a good number of customers. His earnings allow him to meet the financial expenses and to pay for the education expenses of their kids.
Shabnam is applying for the first time to Asasah (a microfinance institute in Pakistan) to purchase the construction supplies (cement and bricks) to expand her husband’s construction supplies business. She is a member of a group of four people.
This is a Group Loan
In a group loan, each member of the group receives an individual loan but is part of a larger group of individuals. The group is there to provide support to the members and to provide a system of peer pressure, but groups may or may not be formally bound by a group guarantee. In cases where there is a group guarantee, members of the group are responsible for paying back the loans of their fellow group members in the case of delinquency or default.
Kiva's Field Partners typically feature one borrower from a group. The loan description, sector, and other attributes for a group loan profile are determined by the featured borrower's loan. The other members of the group are not required to use their loans for the same purpose.
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