Micro Group Loan

Loans taken in group and taking the liability of other person to meet the needs of various people together. A lending mechanism which allows a group of individuals - often called a solidarity group to provide collateral or loan guarantee through a group repayment pledge. The incentive to repay the loan is based on peer pressure, if one group member defaults, the other group members make up the payment amount.

The loan is offered to any groups of targeted clients for using as capital in their micro-scale business and other income-generating activities in order to improve their livelihood.

Group loans is a unique financial service for low-income groups. To obtain such a loan it is necessary to form a group of two or more individuals (female borrowers only) who can run businesses that can earn income & have been active. Individuals who are willing to take group guarantee for each other can form groups to avail the loan.
These are loans given under the Joint Liability Group (JLG) model. Group loans are offered for using loan/credit for income generating activities to improve their livelihood. Fincare Small Finance Bank offers Group loans at affordable interest rate to its borrowers. These are collateral free loans offered to micro banking customers residing in rural pocket of Bank’s Operating geography.