What are Group Loans?
In a group loan, a set of individuals—usually 5 to 20 members—form a group and apply for loans collectively. Each member is responsible for their own portion of the loan, but the group as a whole shares accountability. This system ensures higher repayment rates, as members support and encourage each other to stay disciplined.

Key Benefits of Group Loans

1. Financial Inclusion – Provides credit access to those with little or no collateral.

2. Community Support – Borrowers motivate each other, creating a sense of unity and shared progress.

3. Lower Risk for Lenders – Group accountability reduces the chances of default.

4. Women Empowerment – Group lending often focuses on women, helping them start small businesses and contribute to household income.

How Group Loans Work

• Members undergo basic financial literacy training.

• Loans are disbursed to individuals but guaranteed by the group.

• Regular group meetings are held for repayment, discussion, and mutual support.

Why Group Loans Matter
In rural and semi-urban areas, where trust and community ties are strong, group loans encourage financial discipline, entrepreneurship, and social empowerment. From small shops to agriculture and crafts, these loans fuel grassroots development.