Bank targets vendors with new group loan product

WOMEN’S Micro Bank chief executive officer Gunanidhi Das says informal sector businesses such as market vendors can get group loans from the bank instead of personal loans.
Des said this would make it easier in reducing the delinquency risk because the group would collectively shoulder the responsibility of repaying the loan.
He said the product was called a self-reliance group which promoted group savings culture and easier access to finance.
“All banks in PNG are trying to bring financial services to the people,” he said.
He said the bank was keen to offer services to those in rural areas and the informal sector but this was fraught with risk so they came up with a product to breach that gap.
“So what we are doing is if we are going to the market like Waigani market, instead of going one by one and trying to do savings culture, we are trying to make it in a group and then that group can take care of that savings rather than one individual,” he said.
He said it was practical to share the liability among a group than to have a single borrower.
“When you are trying to take a loan, instead of you alone being the liable person, the group is going to be liable.
“It can be 10, 20, 30 or 50 in a group to take a loan from Women’s Micro Bank. When someone is really having a problem, others can step in and help.
“It is a joint liability we call it sell-reliance group.”