Eleven people from Tuol Tbaeng village in Takeo Province have grouped themselves for a village bank loan and Mr. Boy U. is the village bank president. He is a bicycle repairman. His wife, Mrs. Heng Sothea, is a fish breeder. Since her business is going well, she wants to expand it and Mr. Boy U. decided to ask for a loan for his wife to buy fish for her breeding business. He hopes that her business will increase their income and provide a better life for their family. He is 25 years old and a father of a child who is still too young to work or study. Mr. Boy U. did not come to take the loan, so his wife appears in the group picture in his stead.
This is a group loan consisting of mainly end-of-term loans. Four members have end-of-term loans and the rest of have monthly payment loans. These members are not required to pay any principal on the loan until the very end of the loan term. End-of-term (EoT) loans are AMK’s main product. This loan is the most beneficial to Cambodia’s poor because it allows them to repay portions of the principal whenever they are financially able. Most clients start to make their payments many months before the end of the loan term. Almost all of AMK’s client make their payments on time.
Angkor Microfinance Kampuchea (AMK) is a leading microfinance institution in Cambodia with a wide reach of operations. AMK works with over 6,000 villages and serves clients in every Cambodian province. With an average loan size of US$115, AMK’s focus is to provide credit and savings products to the very poor in rural areas. For more information, please visit AMK's website.
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.