Social Impact Assessment of Microfinance Programmes - weman

individual lending portfolio. The loan amount can range from as little as a few thousand
rupees to Rs. 25,000; the exact amount is decided by the credit committee based on the
need and business plan given by the applicant. The most common amount for the first
loan is Rs.10,000 and the instalments are Rs.1,000 every month. Usually an effort is
made that the instalment structure is such that the monthly payment comes out to be
Rs.1,000 a month so that it is easy to remember for the client. In subsequent loan cycles,
the amount of the loan is raised by Rs.2-3,000.
5.1.4.2 Liberation Loan
This loan is for people who have borrowed from moneylenders and are paying exorbitant
interest rates on the loan. Akhuwat pays off the principle amount in one go for the client
and then the client repays it to Akhuwat in instalments. It comprises 5 percent of the
Akhuwat loan portfolio as given in Table 5.1. Liberation loans are approved from the
head office and if they are unusually large, more than Rs.25,000; the Executive Director
approves it.
5.1.4.3 Housing Loan
A housing loan has also been offered since the last year and is in the range of Rs.40-
50,000 and has to be repaid in two years. This loan product has been offered in
collaboration with Al-Noor Umar Welfare Trust, another voluntary organization.
5.1.4.4 Other Products
The other products offered are Health, Marriage and Education loans. Although these are
non-productive loans, but important events can cause a major stress on the poor, therefore
they are being offered by Akhuwat. The maximum amount loaned is Rs.15,000 but
generally the amount is Rs.10,000. The loan for wedding expenses is specifically for
daughters or sisters of the poorest of the poor. These loans have to be repaid within the
year.
Table 5.1: Loan Portfolio Distribution
Loan Product Number of Loans Portfolio %
Enterprise 13,351 91
Liberation 762 5
Housing 147 1
Education 132 1
Marriage 218 1
Health 101 1
Total 14,711 100%
Akhuwat staff also provide technical training to its clients. They make the latest
knowledge and market information available to the clients so that they become more
efficient. Clients who lack expertise are taught and trained in the vocations of their
interest. They may do ‘internships’ with borrowers who are already running some
specific enterprises and are desirous of imparting skills to others. Akhuwat coordinates
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