Amina baji, wife of R. A., lives in Pak Pattan, Pakistan. She has been married for the last 10 years. She is a mother of four children: three daughters and one son. All of her children are enrolled in a local school. Her husband is a tailor. He has been in this profession for the last 25 years. Her daily income is $2 to $3. She successfully completed her first loan from Asasah. Now she is applying for a loan for her husband, who want to buy a sewing machine.
She has been joined in her loan group a few more members: Naziran baji, who wants a loan for her garments business; Nusrat baji wants a loan for her food business; Shahnaz baji wants a loan to buy spare parts for her juicer machine; Maryam baji wants a loan to expand her barber salon.
This is a group loan. The loan funds will be distributed among the group members, each of whom will invest in her business. The members mutually guarantee one another's loans. If one member does not repay, the other members are responsible.
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.