Shamim operates her own embroidered-clothes business. She receives orders from her neighbors and relatives and charges them 300 Pakistani rupees on each dress. She almost completes fifteen embroidered dresses every month and earns Pak Rs. 4,500 to 5,000. Her income allows her to share with her husband the financial burden of the family.
Shamim’s husband runs a grocery shop. His shop is located in the community where no other grocery shop is placed so his shop always fills with customers. Therefore, he has to keep additional stock all the time to earn more profit and to complete the orders of his customers.
Shamim has been taking loans from Asasah, a micro-finance institute in Pakistan, for the last two years. Now she is applying for her third loan to purchase products (rice, lentils, cooking oil and spices) in bulk to increase the profit of her husband’s grocery shop.
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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Success!! The loan was 100% repaid