Welcome Guest

Businessex.Com

Strict Standards: Only variables should be passed by reference in /home/franchis/public_html/entrepreneur/entrepreneur/templates/InterviewDetail_tpl.php on line 7
Home Interviews Start Up  Woman  Financing the poor

Financing the poor

Microfinance institutions have proved to be a boon for the poor who have aspired to stand on their own by giving them micro-credits without any credit worthiness verification. Grameen Koota based in Bangalore is one such success which helps poor women in

Tags: Grameen Koota

BY Bhuvnesh Talwar | October 14, 2009 | COMMENTS ( 0 ) |

Financing the poor
Vinatha M Reddy Founder, Grameen Koota

Microfinance institutions have proved to be a boon for the poor who have aspired to stand on their own by giving them micro-credits without any credit worthiness verification. Grameen Koota based in Bangalore is one such success which helps poor women in rural and urban areas with micro credit, to work themselves and thereby their families out of poverty. They constantly deliver need based financial services in a cost-effective manner and have become a financially sustainable microfinance institution for the poor. Vinatha M Reddy, Founder, Grameen Koota spells out the details of how Grameen Koota delivers its financial services to the poor.

 

 

Bhuvnesh Talwar(BT): Which type of businesses can avail of funding from MFIs?

 

Vinatha Reddy(VR): Almost every kind of business can avail MFI funding, as long as they are not anti social. The most prominent businesses include Petty shops, Animal husbandry, Agriculture land leasing, Trading, Small Hotels, Artisans, Pushcarts and Rickshaws, Working capital & Service sector.

 

 

BT:  What are the eligibility criteria for an entrepreneur to avail of loans from MFIs?

 

VR: The members of the group should only be women (in group lending model) of the same age group and socio-economic background.  Only one member from each household is allowed to participate but should not be from the same village and so should enjoy mutual trust. The projected cash flow of the applicant and her family members should be sufficient to service the loan.

 

 

BT: What is the procedure for obtaining loans from MFIs?

 

VR:  Firstly, the applicant should be a member of the MFI. The Group and Centre (of which the applicant is a member) should agree for sanctioning the loan to the member. The application should be processed by Field officer and Branch Manager and necessary consent of the MFI should be obtained. Finally, on the schedule day of the disbursement of the loan, satisfactory attendance of group and centre is mandatory.

 

 

BT:  What is the maximum loan amount that can be availed from MFIs?

 

VR: The total amount of loan granted depends upon the lending model, i.e. group lending or individual lending. It may vary from Rs.10,000 to Rs.50,000. Further loan is given in different cycles. Once an individual repays a loan successfully, he is eligible for a higher amount of credit in the next cycle.

 

 

BT:  What is the interest rate charged on MFI loans?

 

VR: In the group lending model, the interest charged is 12% per annum, while in the individual lending scheme it is 15% per annum.

 

 

BT: Kindly explain the mode of repayment of loans?

 

VR: In the group model, loans can be repaid on a weekly basis, whereas in individual lending repayment can be on a weekly, bi-weekly or monthly basis.

 

 

BT: What is the current default rate among borrowers from MFIs?

 

VR:  The current default rate as on August 2009 stands at a minimal 0.69%.

 

 

BT: Apart from credit, what other facilities does Grameen Koota offer?

 

VR: Apart from credit, we offer many insurance products (health, life & livestock). We also offer capacity building services for clients through our SED workshops covering health, nutrition, AIDS awareness, insurance Government schemes, financial literacy, law, panchayat raj etc.,.

 

 

BT:  How much support have you given to women entrepreneurs as part of women empowerment?

 

VR: 100% of clients in Grameen Koota are women, by targeting women in our program; we have empowered them both socially & economically. Being part of a group she has gained an identity, having access to institutional credit has enabled her to dream & work for a better future. Her status in the household & community has grown. Her decision making abilities strengthened.

 

 

 

 

 

 

 

 

Please add your comment

Rating  
Not readable? Change text.

Enter the characters as seen on the image (case insensitive)
  Notify me of followup comments via e-mail   Subscribe for daily newsletter

Related Interviews

How JetSetGo is redefining the private aviation business in India

Kanika Tekriwal, Co-Founder and CEO, JetSetGo

  Hailing from a typical Marwari family, running a successful business and taking risks was always there in the DNA of Kanika...

How Globalite Retail became youth's preferred sports lifestyle brand

Aayushi Kishore, Co-founder and CEO, Globalite Sport

Having identified the huge potential in Indian market for a mid segment sports lifestyle brand, Aayushi Kishore founded Globalite Retail...

Finding dance fans in India is a big challenge: Madhuri Dixit-Nene

Madhuri Dixit-Nene, Founder, Dance with Madhuri

Madhuri Dixit-Nene has launched her online dance academy ‘Dance with Madhuri’ (DWM), with an aim to promote healthy life...

How Ishveen Anand strives to make a difference in Indian sports sponsorship industry

Ishveen Anand, Founder, OpenSponsorship

At a young age of 29, the British native of Indian origin Ishveen Anand achieved a significant milestone in her professional career...

How Krishna Bisht's Mahila Haat is empowering women in rural areas

Krishna Bisht, Founder, Mahila Haat

Women of Kumaon (Uttarakhand) are well-known for knitting art, but several factors like illiteracy, lack of self-confidence, weak...

How Rashi Choudhary is living her dream with LocalBanya

Rashi Choudhary, Co-Founder and COO, LocalBanya.com

The entrepreneurial experience for the trio of LocalBanya has been a rewarding one. Rashi Choudhary, Karan Mehrotra and Amit Naik started...

Meet Lisa Srao, founder of the fastest growing liquor start-up in India

Lisa Srao, Founder, I Brands Beverage Ltd

Alcohol industry is considered as one of the most criticised industries in the world. Being a women, Lisa Srao, founder of I Brands...

People at the Forefront

Yeshasvini Ramaswamy

A former management consultant at Infosys BPO, Yeshasvini Ramaswamy,  Managing Director, e2e People Practices, and Chief Anchor of...

A Sweet Success!

Saroj Samtani, Director, HangOut

If you are passionate about something, their story will inspire you − it is the journey of ordinary people achieving extraordinary...

Making Success through Households

Debadutta Upadhyaya

The all-time tussle to maintain a balance between work and family life for a working woman has finally come to an end with...

Education Beyond Classrooms

Tabassum Modi

What made you enter the education sector? Please tell us about your initial journey. I studied in one of Bangalore’s best...

Offering lifestyle to children

Aditi Binani, Director, KinderHomes

Slamming the fact that children have little say in their own living, Aditi Binani and Kulin Parikh, (now the directors of Kinder Homes),...

Flavours & Spices: Konkan Spices and Curry Makers

Balbina Carmen Pinto, Founder, KSC

While tickling your taste buds with its various spice formulations, the brand has in a short time competes with other brands on kitchen...

Counseling Re-defined

Surabhi Dewra, Founder and Lead, MeraCareerGuide.com

Saurabhi Dewra derived a unique way of educating students by an online medium known as MeraCareerGuide.com. It is a unique platform to...

Crafted her way up

Tushina Goyal, Founder, Tushina

A NIFT graduate carved out a career out of crafting personalised products for children. Tushina Goyal, the founder of Tushina, within no...

Passion for fashion

Mrs Arti Mehra, Fashion Designer

Being born in a fashion family, for Arti Mehra her affinity towards garments came naturally. Creating the brand-Study by Janak has been a...