Hossain (2001) defined micro finance as a practices of offering small,
collateral-free loans to people who otherwise would not have access to capital
to begin small business or other income generating activities.
collateral-free loans to people who otherwise would not have access to capital
to begin small business or other income generating activities.
Conroy (2003) defined micro finance as the provision of finical service to
poor and low income house hold without access to formal financial institution.
Micro finance is a general term to describe financial service to low income
individual or other who don’t have access to typical banking service.
According to CGAP (2011)
Microfinance offers poor people access to basic financial service such as
Loans, serving, money transfer service and micro insurance. People living poverty,
like everyone else, need a diverse range of services to run their business,
build assets, smooth consumption and manage risk. With all this why do people
still find it difficult to get financial assistance from the bank?
Microfinance offers poor people access to basic financial service such as
Loans, serving, money transfer service and micro insurance. People living poverty,
like everyone else, need a diverse range of services to run their business,
build assets, smooth consumption and manage risk. With all this why do people
still find it difficult to get financial assistance from the bank?
Target Customers
The bank’s target market is aimed
mainly to economically active poor women and in rare cases men who are
deprived, vulnerable and tend to engage in small economic activities which can
be supported by small loans. These activities contribute to the local economy
by providing useful goods and services and improving the condition of in
households, particularly those of children in terms of nutrition, health
education and general welfare. Here are the easy step to secure a loan and even
pay off without stress
mainly to economically active poor women and in rare cases men who are
deprived, vulnerable and tend to engage in small economic activities which can
be supported by small loans. These activities contribute to the local economy
by providing useful goods and services and improving the condition of in
households, particularly those of children in terms of nutrition, health
education and general welfare. Here are the easy step to secure a loan and even
pay off without stress
Group Formation
A group consist of five to thirty
depending on their product. Belonging to a group is not new in Nigeria because
many people are already members of a group, either in the church or within
their immediate community and so the concept of a group is not new to us, but
what may be new is that we may not be aware theses our groups should be use
more for economic benefit and less for social benefit, the group should consist
of individual who has something in common they either come from the same community,
same religion or same age group or market.
depending on their product. Belonging to a group is not new in Nigeria because
many people are already members of a group, either in the church or within
their immediate community and so the concept of a group is not new to us, but
what may be new is that we may not be aware theses our groups should be use
more for economic benefit and less for social benefit, the group should consist
of individual who has something in common they either come from the same community,
same religion or same age group or market.
For an individual to belong to a
group or be recognized as a customer of the micro finance bank, the following criteria
must be met:
group or be recognized as a customer of the micro finance bank, the following criteria
must be met:
1) The Customer must be engaged in
an income generating activity: This means each and every one in the group must
have something doing, not like the bank is giving you money for charity
an income generating activity: This means each and every one in the group must
have something doing, not like the bank is giving you money for charity
2) The age limit is between 20 to
25 years: This is an economic activity for improving lives so is not a child
play.
25 years: This is an economic activity for improving lives so is not a child
play.
3) Other group member must attest
to the fact that the customer is of good behavior: this aspect is very
important because if your group can defend for you, then how do you expect the
bank to give you loan
to the fact that the customer is of good behavior: this aspect is very
important because if your group can defend for you, then how do you expect the
bank to give you loan
4) Two account must be open for
each group namely compulsory saving and loan account with a non-refundable
account opening deposit of 400 or above
depending on the bank each on the respective account and will be jointly run by
the group leader and secretary of the group in behalf of the other group member
each group namely compulsory saving and loan account with a non-refundable
account opening deposit of 400 or above
depending on the bank each on the respective account and will be jointly run by
the group leader and secretary of the group in behalf of the other group member
Product description: These products is
made available to members of a group or association (register or unregistered)
involved in activities whose risk profile are considered acceptable to the
bank, however those that don’t fall into the above would be treated on a case
by case basis. The products will be driven to represent not less than 80% of
the bank’s total loans portfolio at any point in time. The product encourage
group lending which encourage compulsory saving along with repayment of the
loans facility granted. The minimum amount that can be giving to is N200, 000
for basic while the maximum is N500, 000 respectively for a maximum of 180 days
of 24 weeks
made available to members of a group or association (register or unregistered)
involved in activities whose risk profile are considered acceptable to the
bank, however those that don’t fall into the above would be treated on a case
by case basis. The products will be driven to represent not less than 80% of
the bank’s total loans portfolio at any point in time. The product encourage
group lending which encourage compulsory saving along with repayment of the
loans facility granted. The minimum amount that can be giving to is N200, 000
for basic while the maximum is N500, 000 respectively for a maximum of 180 days
of 24 weeks
Requirement:
Group account to be opened with
the bank
the bank
Group membership will be a
minimum of 5 to 10 members for the TL (Thread Loan) and a maximum of 5 to 30
members for the SL (support loan)
minimum of 5 to 10 members for the TL (Thread Loan) and a maximum of 5 to 30
members for the SL (support loan)
The maximum exposure of the bank
per each borrower in a group is paged at N200, 000 (two hundred thousand naira)
for tread loans and N500, 000(five hundred thousand naira) for support loans.
per each borrower in a group is paged at N200, 000 (two hundred thousand naira)
for tread loans and N500, 000(five hundred thousand naira) for support loans.
The payment period will not
exceed 180 day or 24 weeks
exceed 180 day or 24 weeks
Compulsory saving account must be
maintain and the account must not have less than 10% of the amount requested
for.
maintain and the account must not have less than 10% of the amount requested
for.
Repayment must be done on weekly
basis and on a specific day of the week which will be agree by the group during
their meeting, the loans office together with the group pick a date and time of
meeting.
basis and on a specific day of the week which will be agree by the group during
their meeting, the loans office together with the group pick a date and time of
meeting.
All disbursement must be routed
through the group account inclusive of repayment
through the group account inclusive of repayment
Group guarantee are required
Voluntary saving would be a
minimum of 10% of the week loan repayment amount and must be paid with weekly
loan repayment
minimum of 10% of the week loan repayment amount and must be paid with weekly
loan repayment
you can revitalize your business by getting loans from micro finance banks, its easy, just follow the steps above!!!
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