Seema baji is 46 years old and has lived in Lahore, Pakistan for her entire life. Her husband is named M. H. and he works in a factory. She is the mother of five children: four sons and one daughter. Her first two sons work in a factory. The other two are enrolled in a local school. Her daughter is 20 years old and stays at home to help with household work. Seema baji runs a grocery store which she opened at her house. She started this business because her husband’s income is insufficient to meet household expenses and the cost of her children’s education. She has been in this line of work for three years, and has repaid a previous loan from Asasah (a microfinance institute of Pakistan). Now she is applying for a new loan to buy groceries for her shop.
She leads a group with several other members who live nearby. Rani baji and Musarat baji each want a loan to repair their auto-rickshaw (a local three-wheeled motor vehicle). Sanobar baji wants a loan to buy an auto-rickshaw. Rashidan baji wants a loan to buy a flour polisher to resell. Sabiha naz baji wants a loan to buy groceries for her store.
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.