Valar Aditi Social Finance Private Limited (VASFPL)
A Microfinance Initiative.
Empowering women through financial inclusion and capacity building.
A Microfinance Initiative.
Empowering women through financial inclusion and capacity building.
BUSINESS MODEL:
VASFPL has adopted the Joint Liability Group (JLG) method of lending, which lends to women organized into a group of five members. Approval of loans is based on group recommendation and mutual guarantee. This is based on the basic principles and methods evolved in Grameen Bank, Bangladesh with modifications made to suit local clients and conditions. Currently, VASFPL has only one product, called IGL- Income Generation Loan, which is a group lending programme exclusively for women.
All members of the groups undergo Compulsory Group Training (CGT) about the company, JLG concept, product details, and loan disbursement and repayment. Accreditation and lending to a group is based on a Group Recognition Test (GRT) with a set of criteria developed for members, group functioning, centers consisting of more than a group and other stipulated norms for microfinance.
The operational and lending procedures ensure that the loan provided to the end-clients meet all the guidelines stipulated by RBI to facilitate the Banks to avail "Priority Sector Status" for the credit facility extended to the Company.
Currently, Valar Aditi Social Finance Private Limited offers loans only for income generating activities. The loan repayment is consists of 1 - 1 1/2 years the repayable in monthly/fortnightly/ weekly installment as per the requirement of the borrower.
| CYCLE | LOAN AMOUNT (IN RS) | INSTALMENTS (MONTHS) | PROCESSING FEE 1% (IN RS) | GST 18% (IN RS) |
|---|---|---|---|---|
| First cycle | Rs. 40,000 | 24 | 400 | 72 |
| Second cycle | Rs. 60,000 | 24 | 600 | 108 |
| Third cycle | Rs. 80,000 | 26 | 800 | 144 |
| Fourth cycle | Rs. 1,00,000 | 26 | 1,000 | 180 |
The loan is issued to member in person and the monthly installment is collected from the members directly.