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LOAN POLICY
1. Preface
This paper has been drawn by way of consolidation, updation and additions to our existing lending norms with a view to present a comprehensive policy document for favour of the Board’s approval. The policy seeks to maintain consistent improvement in asset quality, improvement in net interest margins and operational efficiency particularly in the areas of compliances and risk management.
2. Regulatory regime As a Non Banking Financial services company registered under the Reserve Bank of India Act , our lending policy is guided by the directives and guidelines issued by The Reserve Bank of India from time to time . As such, this policy document is subject to review based on periodic changes in regulatory norms.
1. Single / Group Exposure norms - Lending to any single borrower will not exceed 15% of owned funds and to any single group of borrowers not to exceed 25% of owned funds.
2. Maintain a Capital to risk weighted asset ratio of 15%. 3. Prudential lending norms - Asset classification, provisioning requirements as per RBI
Prudential norms. 4. Fixation of maximum loan per gram based on the Loan to Value (LTV) guidelines of RBI 5. Compliance with Anti money laundering / countering financing of Terrorist Activities as
elucidated in our Anti Money Laundering (AML) policy
3. Risk management We have a zero tolerance policy on risk. The different tiers of control already implemented, begins at the branch level. Regional Managers, Audit Managers, Operational Managers and Vigilance Managers have a clear job role to enforce routine check on enforcement of quality assurance measures. CO functionaries will also undertake random check on related issues, whenever they visit the branches. The Risk Management Committee, of the Board, is entrusted with the task of identification, measurement, monitoring and mitigation of the risk factors on an ongoing basis.
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As a part of our ongoing risk mitigant initiatives, the Company has implemented rating matrix system to assess vulnerability at branch as well as at corporate office levels. This rating exercise will be a part of periodic audits. Notwithstanding, given the short term nature of our Loan assets cushioned well by net interest margins, the secured nature of business, vulnerability to credit, operational as well as market risks is limited.
4. Resources Our funding needs are presently sourced out of debentures and also partly through working capital facilities from Banks. Reckoning our ambitious growth plans, steps have been initiated to source additional banking facilities, in addition to periodical issue of non-convertible debentures. As a part of our initiative to raise cheaper source of funds and also to draw parity with our assets maturity profile, alternative short term sources of funding would also be added to the resources.
5. Loan Pricing policy The interest rates on gold loans will be fixed by the company on the basis of the following internal valuations.
1. The company lends varying amounts per gram of the gold (LTV) depending upon the market value and the purity of the gold. As per the risk assessment of the company a higher LTV is riskier than a lower LTV. Accordingly, lower LTV attracts lower rate of interest and higher LTV attracts higher interest rate. Further, in case of schemes where the interest rate varies with tenor of the loan, the borrower can remit the monthly interest alone and continue to enjoy the loan at lower interest rate.
2. In terms of RBI guidelines, maximum LTVrate that can be fixed should not exceed 30-
day average of the closing rate for standard gold (22k) fixed by India Bullion and Jewellery Association.
3. No allowance has been provided for add-ons such as making charge, sales tax, etc.
4. The maximum permissible LTV (Loan-to-Value) of the pledged ornaments will, however, be within the ceilings stipulated by RBI from time-to-time (The maximum permissible LTV is 75% at present).
5. Cost of funds: Interest on loans will be levied as a mark up on the current cost of funds.
The current cost of funds for this purpose means the incremental cost of borrowings of
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the company, its operating cost, loan loss provision and taking into account the operating margins required for growth of the Company.
6. The interest rates charged by the Company shall be expressed in compound rates with
monthly rests.
6. Products The Company’s assets are advances granted against the security of gold. Therefore the products profiles are reviewed regularly with a view to customize products in line with market expectations, availability of funds and competitor analysis. Variants of loan products through different schemes within the policy framework are done after periodic review of market conditions, duly approved by the board. Gold loan schemes of the company are extended for a period upto 12 months from the date of initial sanction . The existing Gold loan products are described below:-
Smart Loan
i) Customers are always looking for interest rates and value for their gold to get maximum loan amount to meet the financial requirement. Smart Loan will meet the financial requirement, if the customer want to avail loans with higher rate per gram. The scheme is designed for those customers who have the habit of paying interest monthly.
ii) Easy Loan Easy Loan will meet the immediate financial requirement, if the customer want to avail loans at lower rate of interests. If the customer have the habit of paying interest monthly, this scheme will be suitable.
iii) Quick Loan
Quick Loan is the best financial solution, if the customer want to avail loans at lower rate of interests. Speedy disbursal of the loan will be ensured without waiting too much in the Branch.
iv) Mahila Loan
Through Mahila Loan we help to empower women customers by providing timely credit which will satisfy thier immediate requirement without waiting too much. Self-help groups, women engaged in making handicrafts, tailoring, vegetable dealers,
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women drivers and all other working women in the country are eligible for this specialised product. Muthoottu Mini Mahila Loan is a solution which will speed up theier efforts to support their family. We are also inclined towards giving additional benefits of interest to women.
v) Aaswas Loan
Aaswas Loan will meet the immediate requirement of the customers who want to avail loans at lower rate of interests for a shorter period. This product is available in all Branches of Muthoottu Mini.
vi) Premier Loan Premier Loan is best suited if the customer require higher loan amount with lower rate of interest. Traders, business people, people engaged in constructions and all those people who require higher loan amount with enough gold jewels in your hands are eligible for this product.
vii) EMI Loans An EMI scheme where the borrowers have the option to borrow money at lump sum and pay back on a monthly basis by pledging your gold ornaments. Maximum repayment period under this scheme is 12 months from the date of loan.
viii) Daily Collection Schemes A scheme which attracts the traders and daily income segments of the society. Customers can repay the loan in daily instalment. The borrower can close the loan by remitting daily instalments in 99 days. This loan product is available in selected branches of Muthoottu Mini.
ix) Online Gold Loan Our Online Gold Loan integrate the technology and our efficiency to bring the customer convenience as never before. Customers can avail gold loan from any branch.
x) MM PrePay Muthoottu Mini have come with a solution to maximize the customer satisfaction. MM Pre Pay is a solution to meet the financial requirements of the people by paying the interest in advance without the burden of accumulating interest by the end of the loan period.
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xi) 90 paisa Scheme 90 paisa scheme is one of the lowest interest scheme presently available in Muthoottu Mini. This gives customers more money to spend by reducing their interest burden, which can create a ripple effect of increased spending throughout their life.
xii) Loan Against Property
Loan Against Property is given against equitable mortgage of property. Maximum Loan granted will be 3 crores with maximum tenure at 36 months.This loan is given at a fixed rate of Interest of 22.81%. The Board of Directors will sanction each loan on case to case basis after considering the valuation report on the property and legal opinion on the property documents.
xiii) Microfinance Loans
Microfinance loans are loans given to Female clients for Income Generating Activities on the basis of joint liability. Loans are repayable in equated instalments over a period of time.
Loans are given for declared legal end use, like business expansion, working capital needs, purchasing raw material, purchasing animals, Marriage, education, debt consolidation etc. Clients are organized in center consist of 5-25 females divided in to sub groups and each woman takes joint liability for the other members of the group. The clients have weekly meetings where they pay back the loans to the field officers called Relationship officers of the company. All process and procedures are formulated based on RBI’s NBFC – MFI guidelines and MACC issued by SRO -MFIN issued from time to time.
Microfinance Loan Policy is as per Annexure-1
7. Purpose
While we are not required to ascertain the purpose of the loan, since KYC requirements are met, it will be essential to confirm that the funds raised out of our gold loans are not to finance terrorist activities and or for money laundering purposes.
8. Quantum of advance and discretionary limits
While no minimum loan level is prescribed, company has stipulated that the minimum quantum of gold ornaments that can be ledged at one time will be two grams of gold content.
Maximum loan - no maximum cap, though individual loans of Rs 5,00,000/- and above should bear the respective RM’s prior approval. RMs can approve loans to individual borrowers upto RS 25,00,000/- (Twenty five lakhs only) subject to strict compliance with quality as well as rate per gram criteria (LTV). In such cases RMs should reconfirm that KYC norms have been fully complied with .
Loans to individuals above the value of Rs 25 lakhs should bear Regional Head’s prior approval.
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Loans above value of Rs. 50 Lakhs will be approved by the operations Head at the Corporate office of the Company with recommendation of the Regional Head.
While approving loans compliance with ceiling linked to our net owned funds, fixed by RBI, will have to be ensured.
9. Repledger Loans
The Company has decided to stop giving gold loan to repledgers. Branches are prohibited from extending loans to repledgers.
10. Margin
Maximum loan amount is restricted to 75% of market value on the date of advance. Rate per gram in all cases will be as per CO guidelines issued from time to time. Branches do not have the discretion to offer different per gram rates than the one circulated. Company has decided to adhere to the maximum rate per gram LTV computed on the basis of monthly average rate of 22 carat gold published by India Bullion and Jewellers Association( IBJA).
11. Verification of Ownership of Gold
Where the gold jewellery pledged by a borrower at any one time or cumulatively on loan outstanding is more than 20 grams, branch shall keep a record of the verification of the ownership of the jewellery. The ownership verification need not necessarily be through original receipts for the jewellery pledged but a suitable document shall be prepared to explain how the ownership of the jewellery has been determined, particularly in each and every case where the gold jewellery pledged by a borrower at any one time or cumulatively on loan outstanding is more than 20 grams.
12. Standardisation of Value of Gold
The gold jewellery accepted as collateral by the company shall be valued by the following method:
a) The gold jewellery accepted as collateral by the Company shall be valued by taking into account the preceding 30 days’ average of the closing price of 22 carat gold as per the rate as quoted by the India Bullion and Jewellers Association( IBJA).
b) If the purity of the gold is less than 22 carats, the Corporate Office shall translate the collateral into 22 carat and state the exact grams of the collateral. In other words, jewellery of lower purity of gold shall be valued proportionately subject to the condition that the purity of the ornaments is not below 19 carats.
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c) Company, while accepting gold as collateral, should certify that they have assayed the gold and state the purity (in terms of carats) and the weight (gross and net weights) of the gold pledged with suitable caveats to protect themselves against disputes during redemption. The certified purity shall be applied both for determining the maximum permissible loan and the reserve price for auction
13. General Conditions
1. Muthoottu Mini Financiers Ltd refrains from interference in the affairs of the borrower except for the purpose of loan provided in the terms and conditions of the agreement unless a new information not earlier disclosed by the borrower has come to the notice of the company.
2. All gold loans will be sanctioned on the basis of a preliminary assaying of the purity of the pledged ornaments. These will be verified later on by qualified/ experienced gold assayers appointed by the company and in case the purity of the pledged ornaments are below the minimum accepted level of purity approved by the company, the company reserves the right to recall such loans without delay or notice.
3. Since gold loans are sanctioned instantaneously, no acknowledgment of loan application will
be given.
4. The company does not resort to use muscle power or unlawful coercion methods for recovery of loans granted by the company.
5. All loans are sanctioned at the sole discretion of the company
6. The pledged ornaments will be stored in pucca strong rooms and will be duly insured against
theft, dacoity, etc. 14. Way forward
We realize the need to constantly review and upgrade lending policy to review the products profile as well as terms to be able to be competitive in the market. With our vision to become a preferred service provider in the financial services segment and to migrate to become a financial supermarket, product innovation, customization, addition and modification will remain a continuing process.
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Credit Policy IGL
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Credit Policy IGL
CONTENTS
1. overview 3
2. Product Features 4
3. Target group 6
4. Underwriting criteria 9
5. Documentation 17
6. Comprehensive Group Training (CGT) and Group Recognition 20
Test (GRT)
7. Second cycle and loans in subsequent cycles – loans to retention 33
customers
8. Loan disbursement procedure 34
9. Seating Pattern 35
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Credit Policy IGL
1. PRODUCT OVERVIEW
Microfinance loans are loans given to Female clients for Income Generating
Activities on the basis of joint liability. Loans are repayable in equated
instalments over a period of time.
Loans are given for declared legal end use, like business expansion, working
capital needs, purchasing raw material, purchasing animals, Marriage,
education, debt consolidation etc. Clients are organized in center consist of 5-
25 females divided in to sub groups and each woman takes joint liability for
the other members of the group. The clients have weekly/fortnightly
/monthly meetings where they pay back the loans to the field officers called
Relationship officers of the company. All process and procedures are
formulated based on RBIs NBFC – MFI guidelines issued from time to time.
2. PRODUCT FEATURES
Parameter Features of IGL
Unsecured Loan backed by group guarantee Type of loan
in a joint liability group (JLG).
Differs from cycle to cycle as given in the Loan Amount
table below.
CYCLE KERALA
1st 10000/20000
/30000/40000
2nd Same
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Credit Policy IGL
Parameter Features of IGL
Tenor 52 Weeks - up to Rs.20000/- loan amount
104 weeks – Rest
Rate of
Interest 26% P.A (Diminishing Rate)
Processing 1 % of the Loan amount + GST (as applicable)
Fee
Tenure Premium for Premium for Total
Applicant Co-applicant Premium
Insurance
52 Rs. 6 per Rs. 6 per Rs. 12 per weeks
Rs.1000 loan
Rs.1000 loan
Rs.1000
Premium
amount amount loan amount
104 Rs. 12 per Rs. 12 per Rs. 24 per
weeks Rs.1000 loan Rs.1000 loan Rs.1000
amount amount loan amount
Foreclosure Nil
Charges
Penalty for Nil
late payment
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Credit Policy IGL
3. Target Segment
5 - 25 economically active married women having regular cash flow from
Income generating activities like:
• Self -managed businesses
• Small shop keepers
• Vegetable Vendors
• Animal husbandry business
• Tailoring business
• And profiles with regular and sustainable cash flows
4. End use of loan:
End use of loan could be:
• To meet working capital requirements
• To expand businesses (vertically and horizontally)
• To purchase animals ( buffalo, cow etc)
• Purchase of stock
• To repay costly debt raised from other sources (money lenders/other
finance companies)
• Loan to be used for business purposes viz. expansion, acquisition of
assets, business etc.
Loan cannot be used for illegal, speculative or anti-social activities
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Credit Policy IGL
5. Non Target Segments
The following are not eligible for a loan
• Political Leaders
• Big Land lords.
• People who have lots of Debts from Banks and Finance Institutions.
• Wine/Liquor shop owners
• Police & lawyers and their immediate family members
• People running finance & chit funds business
• People involved in real estate business.
• People with bad credit history.
• Migrants
• Government employees
• Temporarily rehabilitated people
• Families with members in gulf/abroad. (Spouse and Children)
• Staffs / mothers, sisters or wives of the staffs working in Muthoottu
Mini /Microfinance.
6. Locations and Area:
• All locations to be opened post market survey of the area and with
approval of CEO.
• New Location: The locations will have to be proposed by RM along
with Market survey report in the prescribed format Approved by
Business Head with concurrence of CEO.
• Geographical Limits for Lending:
o upto 25 Km Radius from the Microfinance hub branch which
means sourcing gold loan branch should be upto to 25 Km of the
hub branch AND
o The area which would be covered from gold loan branch should
be within 5 kms radius of sourcing gold loan branch AND
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Credit Policy IGL
o Client house is within 600 meters of the center meeting place.
7. Repayment Mode
Weekly installments to be paid in cash at center meetings by the center
members to the Relationship Officer.
8. Repayment schedule / First Installment date
A specific day in a week to be to be fixed at the time of GRT (group
recognition test) for collecting the installments and the same day is to be set
followed as the collection day throughout the cycle. 1st installment is to be
paid in the immediate next week after 7 days of cooling period from the date
of disbursal.
9. CREDIT NORMS – MICROFINANCE
The credit decision will be taken based on following criteria.
Financial Criteria
• Annual Income
• Repayment Capacity
• Multiple Borrowing
Non Financial Criteria
Non-financial criteria further categorized as follows
Quantitative
• Age
• Employment/Economic Activity
• Residence Stability
• Standard of living
o Housing and
o House asset verification
• Group Composition
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Credit Policy IGL
Qualitative
• Group guarantee
• Health Condition
• Group dynamics
10. Financial Criteria
ParameterFeatures
The total family income should not cross Rs. 100000/- per
annum in rural areas and Rs.160000/- per annum in sub
urban and urban areas. For the calculation of family
Annual income the contribution of all the earning family
Income members should be considered. Total house hold income
should be sufficient to cover all monthly household
expenditures and other fixed obligations including
Microfinance installment.
Repayment capacity is measured by surplus income Surplus = House hold Income – House hold expenditure
Repayment Surplus should be 1 times the instalment offered e.g., if
Capacity monthly surplus is 1200 then weekly surplus would be
calculated by 1200/4 = 300 and maximum affordable
instalment for the client would be 300/1 that is Rs 300
Multiple To avoid overleveraging a client and to reduce multiple
borrowing borrowing an applicant should not be given a loan
• If she has already taken loan from more than 2 MFI
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Credit Policy IGL
under group loans scheme
• If the total outside borrowing of the applicant exceed
Rs.60000 at the time of giving the loan
Loan eligibility calculation would be based on the
affordable instalment.
Eligibility e.g., if the affordable instalment comes out to be Rs 270 a
Calculations client can be given a loan up to Rs 15,000/- as the
instalment for Rs 15,000/- loan is Rs.260/- ( indicative
figures )
11. Non-Financial Criteria
Quantitative Parameters
Parameter Features
Customer Age:
First cycle
Minimum Age – 18years
Maximum Age –55 years (at the time of loan entry)
Divorced and widowed females with 40 years and
above age can be given a loan with proper approval.
Age Subsequent cycles
Maximum Age: From second cycle onwards the max age
can be up to 60 years at the time of loan maturity
Divorced and widowed females with 40 years or more
age can be given a loan with proper approvals.
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Credit Policy IGL
Points to be considered while approving the above 50
years age customers
Health
Income Stability/Economic activity
Support of other family member
Co-Applicant Age:
Minimum age: 18
Maximum Age: entry of age of co-applicant is restricted
to 63 and he/she will have coverage up to 65 years.
Employment / The clients should be economically active married
Economic woman having regular source of income. The business
activity should be verifiable at the time of house verification.
3 years minimum residence stability is required.
In case of newly wedded clients, the applicant should be
Residence staying for at least 6 months and spouse should be
stability staying in the same house for at least 3 years.
This means customer should have married at least 6
months back
Standard of living of the borrower to be assessed by 1)
the type of house they are living in 2) The kind of assets
owned by them
Standard of
living and
Housing
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Credit Policy IGL
Criteria
Urban Semi
Rural Urban
Thatched
houses with
1 room Reject Reject Reject
Thatched
houses with
2 or more
rooms Reject Accept Accept
Sheet/ Tiled
/ RCC roof
1-2 rooms Accept Accept Accept
Sheet/ Tiled
roof with 3
rooms Accept Accept Accept
RCC roof 3
or more
rooms Reject Reject Reject
If the customer owns either washing machine, car or
double door fridge such clients should be avoided
Care should be taken to avoid high income borrowers
who may take this loan for consumption purposes
rather than using for income generating activities.
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Credit Policy IGL
Group
Composition
Members should be economically active married
women
Group size should be from minimum 3 ( 2 in case of
second cycle )
Centre size should be from minimum 5 to maximum
25 members
Centre meeting place should not be more than 600 mts
from each customers’ residence.
At least 75 % of the members in centre should have
their owned house, others can be rented out.
Only one member from one house hold allowed.
No blood relations in the same centers Blood relation: Mother – Daughter , Sister –
Sister KIN Relation: More than Two kin relations are not allowed in the
same center, maximum can be two.
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Credit Policy IGL
We are considering following relations as kin relations:
Mother-in-law – Daughter-in-law, Sister-in-law, Co-
Sisters
Single / Unmarried females should not be given a
loan.
Divorced and widowed females with 40 years and
more up to 55 years at the time of loan maturity(first
cycle) of age can be given a loan.
Qualitative Criteria
Parameter Features
• Group has been made by the clients themselves and
not by the staff.
• Members should know each other.
• All of them belong to same locality
Group • All the clients at a center are willing to take each other
responsibility and give mutual guarantee. Guarantee/JLG
• Members are willing to attend periodic Center
Meetings. .
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Credit Policy IGL
• Group members should confirm that the loan is taken
for Income generating Purpose only and not for any
consumption /illegal activities.
Health Clients suffering for incurable disease like cancer , Stroke
Condition , AIDS or any other disease which will affect their ability
to earn should not be funded
• Women should form these groups on their own
without any interferences of Muthoottu or any third
party (agents)
• Group must ensure that they only select members Group
who are not likely to move in the next one year Dynamics
• The members should not pay any commission to
staff, leaders or any third party for the purpose of
getting the loan. In case if it is found out, the groups
will be rejected immediately
12. DOCUMENTATION
ADHAAR Card is now mandatory along with Identification proof and
residence proof. All client should ensure either the ID proof or Residence
proof is as per below mentioned documents.
Pre Approval documentation Duly filled and signed application form in vernacular
Application required .The application form can be filled by RO. If the
form form is filled by the Client , it should be in the presence of
Relationship Officer.
2 Colored passport size photograph of applicant along Photograph
with spouse signed across on the front of the photograph.
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Credit Policy IGL
Both Primary and secondary document should be in file.
Mandatory Primary Document
• UID ( ADHAAR)
Secondary Document
• Voter ID first choice
• Ration card (can be used as ID proof only if the
ration card is in respective customer’s name with
photo)
• Pan card
• Passport
Proof of • Driving license
identity/ • Scheduled Bank passbook with applicant’s
existence photograph on the same which is duly attested by
bank officials. The respective account should be
active.
• Letter issued by /Revenue Officer/ Village
Administrative Officer.
• Letter from a recognized public authority or public
servant.
KYC documents’ photo copies only need to be taken.
(Originals not required)
KYC documents must be self attested.
Primary Document
• UID Address proof
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Credit Policy IGL
Secondary Document
• Voter ID
• Driving License
• Ration Card
• Passport
• Electricity , Telephone , Water bills –not older than 90 days
• Other Utility Bills - not older than 90 days
• Life Insurance Policy or latest Premium receipt
• Rent agreement
• Consumer Gas Connection Card/Book
• House Allotment letter from Govt. organizations
• Bank statements / Passbook cover page with address being mentioned
• Letter from a recognized public authority or public servant.
Photocopies of the documents should be self attested by
the respective person.
If customer is living in a rented house then ensure the
proof of their permanent address.
Following documents to be obtained
• Contact Point Verification form (CPV)
• CPV should be filled and signed by Credit Officer.
Credit Branch Manager should also sign in CPV after the
documents signature of Credit Officer.
• KYC documents should be verified with originals
and need to mark as OSV (Original Seen &
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Credit Policy IGL
Verified) and duly signed by Credit Officer.
13. Pre-Disbursement & Post approval Documentation:
Loan The following to be obtained-
Documentation • Loan Application Form with duly signed
photograph
• KYC documents
• CPV
• Loan Sanction Letter
• Loan Agreement
• If any deviation is taken then it should be attached
with the respective application
14. Comprehensive Group Training (CGT) and Group Recognition Test
(GRT)
Each applicant should undergo 3 days (3 different days)
of comprehensive group training (CGT) irrespective of
loan cycle within a period of 14 days from the date of
disbursement of loan.
CGT must be happen in 3 different days.
Relationship Officer is primarily responsible for CGT.
Same staff should handle CGT1 to CGT 3. Comprehensive
group training
The focus of the training should be on :
• Developing Group responsibility and joint liability
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Credit Policy IGL
among the members
• Informing clients about terms and condition of the
loan like interest rate, processing fee, insurance
premium, loan documents.
• To inform the importance of Discipline in meetings.
• To check that group has been made by the
clients themselves.
• To check that all the members know each other.
• To check that all of the members belong to same
locality.
• To check that all the clients in groups and at the center
are willing to take each other responsibility
• To check whether the house of the client is not located
more than 600 meters from the center meeting place.
• To check and ensure that there no blood relatives in
the group and there is not more than permitted kin
relation at the center.
• To check and ensure there are sufficient number of
members with owned house in a group as prescribed
by the policy.
Group
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Credit Policy IGL
recognition test All customers who have attended 3 days CGT should
(GRT) appear for the test called GRT conducted by the
Credit Officer.
Purpose of GRT is: � To evaluate the eligibility of the client
� To understand that all client are familiar with
each other
� To ensure there are no agents involved in sourcing and all applicants are willing to take each other’s responsibility for repayment.
� To check that all members are meeting the credit criteria.
� To evaluate the eligibility calculated based on
the cash flow analysis.
� To check that all documentation norms with respect to KYC are met or not.
During the GRT, credit officer need to verify the given
ID and Address proofs with originals.
And Credit Officers need to sign with date on KYC and
need to give an impression as OSV (Original Seen and
Verified).
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Credit Policy IGL
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Credit Policy IGL
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Credit Policy IGL
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- 28 -
Credit Policy IGL
15. Second cycle and loan in subsequent cycle
ParameterFeatures
All clients who have paid at least 50% installments of 1st
cycle loan without any delay or due and also have more
Eligibility than 65% attendance record in the entire center meeting are eligible for 2nd cycle loan.
16. Loan Disbursement Procedure
Disbursement procedure can be done only after the successful completion of
all the previous processes. Disbursement should be done keeping following
points in mind.
� Disbursement should only happen through direct bank credit. ( net of loan outstanding if second cycle )
��
� Loan can be disbursed only to customers those have passed Credit Bureau check & GRT.
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� The date & time for disbursement should be intimated to the customers by the RO according to the instructions of Branch Manager & Credit Officer.�
�
� It should be ensured that there is loan sanction letter .All post approval documentations need to be completed by the end of disbursement. Nothing (signature or documents) should be kept pending.
�
- 29 -
Credit Policy IGL
� Ensure the clients have relevant contact numbers of branch, Branch Manager, Relationship Officer, Head Office.
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� Relationship Officer must hand over updated (member details) loan pass book to members immediately after loan disbursement.
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� Even though loan pass book is meant for each customer, for convenience Centre Leader can receive loan pass book in front of other members.�
Center Meeting Seating Pattern
- 30 -