In this model Livelihood Enhancement program provides micro finance services to the communities in the form of groups. This is done with bank assistance to enhance capacity of group members by enabling them to identify, select, implement and manage their income generation activities. It is one of the best practices of social mobilization/group organization for poor community groups in accordance with bank policies.
The objectives of this model are to:
- Provide micro-finance assistance to potential members of the community.
- Strengthen the solidarity and cohesiveness of prospective borrowers and mobilize them in to viable groups through the process of social awareness.
- Enhance capacity of group members by enabling them to identify, select, implement and manage their income generation activities smoothly.
- Provide basic literacy and record keeping training to group coordinator.
- Motivate the groups for mandatory loan insurance.
Credit Policy Criteria:
The criteria includes credit intervention through group lending, personal guarantee, CNIC, Age 18 to 58, group size 3-12, minimum 2 years experience in Business, one person from one household, at least 2 years village residency, 29% service charges, Rs. 5000 to Rs. 15000 1st cycle, mandatory loan insurance & Rs. 500 process fees per loan and opening of bank account in Khushali Bank Limited.
Micro-credit lending methodology includes following:
Situation analysis, first contact, service introduction, prepare list of prospective clients, cash flow meeting, Community Management Skill Training (CMST), credit appraisal, credit disbursement.
Routine meeting on monthly basis, record keeping, proper loan utilization, comprehensive knowledge about bank policy, assurance of timely recovery, direct link of the group with the bank for further loans.
Agricultural Development Loan – Livestock Development Loan – Working Capital Loan
Till now 52,453 community members have been benefited through this micro finance model.