Salma baji is the wife of M. and a mother of one son. His name is Faisal and he is 10 years old. He is in 5th standard. Salma baji lives with her family in a small city named Chichawatni, Pakistan. She owns a two room brick house and has been living in it for the last 30 years. Her husband is a wheat seller and has been in this profession for the last 7 years. Salma baji is a housewife and prefers to do household work. She is applying for a loan to buy more wheat to expand her husband's business.
She is joined in her loan group by a few more members. Manzooran baji wants a loan to buy more video games for her video game shop. Hajra baji wants a loan to buy cigarettes for her cigarette shop. Rukhsana baji wants a loan to buy wood to resell. Kalsoom baji wants a loan to repair her auto-rickshaw (a local three-wheeled vehicle).
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.