Rubina baji is the wife of M. and lives in a small city named Pakpattan, Pakistan. Pakpattan city is famous for its historical places. She owes a two room brick house and has been living in it for the last 12 years. She is the mother of four children: two sons and two daughters. All of her children are enrolled in a local school in her neighborhood. Her husband is a shoe polisher. Rubina baji makes handmade things and sells them in the market. In particular, she makes ladies' ornaments (embroided parandas). From the shoe polishing work, her husband couldn't provide enough for his family. Therefore he decided to start another business which is driving an auto-rickshaw (a local three-wheeled vehicle). Rubina baji is fully convinced with that with her husband's new work and with buying an auto-rickshaw a loan is necessary.
She is joined in her loan group by a few more members. Bashiran baji wants a loan to repair her vehicle. Sajida baji wants a loan to buy artificial jewelry to resell. Kosar baji wants a loan to take a land on contract to grow seasonal fruit. Khursheeda baji wants a loan to buy groceries for her grocery shop.
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.