Rani baji is married to A. M. and lives in Kot Radha Kishan, Pakistan. She owns a two-room brick house and has no children. Her husband runs a livestock business, and has been in this profession for the last 10 years. Rani has successfully repaid three loans from Asasah (a microfinance institute in Pakistan). Now she is applying for a new loan to buy a buffalo to raise and resell.
She is making this application with several other people. Bashiran baji wants a loan to buy a buffalo for her milk business. Shafqat baji wants a loan to buy wheat to resell. Amna baji wants a loan to buy more inventory for her grocery store. Iram baji wants a loan to buy more supplies for her fruit business.
This is a group loan. The loan funds will be distributed among the group members, each of whom will invest in her own 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.