Rani Abdul Majeed Group
Rani baji is a seamstres: she sews the clothes of her neighbors. Notably, she has already successfully repaid two prior loans from Asasah, a microfinance institution in Pakistan. Now she is applying for another loan to repair and redesign the body of her husband’s auto-rickshaw.
She is joined in her loan group by three other members: Sajida baji seeks a loan to buy more wood for her wood-selling business; Gulshan baji requests a loan to buy more clothes to resell; and another Gulshan baji would like a loan to buy animals (goats and sheep) to resell. This is a group loan; as such, the loan proceeds will be distributed amongst the group members, each of whom will invest in her own business. Importantly, the group members mutually guarantee one another's loans; as a result, if one group member does not repay her portion of the loan, then the other members are responsible for curing the arrears.
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.
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Success!! The loan was 100% repaid