Model

Pragati

A ‘Pragati’ is an informal group of 5-10 women founded on the basis of trust and knowledge of each other’s business and nature. Group members help to run their business and reside in the same locality. Each group selects a group leader who is responsible for coordinating repayments, liaising with the company and regulating group peer pressure. Each group member takes on and agrees to guarantee the loan of others in the group.

Our Pragati model offers our customers the help they need by financing their income generation activities and in the creation of assets, which improves their quality of life.

                                       
Step 1
Group Formation

Groups of 5-10 members are formed with one group leader. The members should know each other, live in close proximity and share a common intent of taking a loan on the basis of group guarantee.

Step 2
KYC Collection

Following KYCs are collected from the primary applicant- 1. ID Proof, 2. Address Proof, 3. Proof of age, 4. Proof of nominee. Voter ID is considered the primary ID proof. Additional documents include nominee’s KYC, nomination form and passport size photographs of nominee and applicant, and bank details.

Step 3
Credit Bureau Verification

In order to ensure that the members of each group are within the established credit lending norms, Credit Bureau enquiry is done before the loan application process. In this process, basic KYC details are entered in the tablet and an instant Credit Information Report of the members interested is generated.

Step 4
Adequate Group Training

The Sales Officer in charge provides the individual members necessary information about the company and other financial details for them to apply for a loan. He orients the individual members about the eligibility, training, documentation process, loan products, terms and conditions and motivates them to associate with the organization.

Step 5
Loan Application

The loan application is through the Digital Field Application (or tablet), wherein the prospective borrowers agree on the terms and conditions of the loan and on joint liability for repayment.

Step 6
Group Verification Process by Branch Manager

The verification process helps in the understanding of the member’s knowledge on the aspects of eligibility criteria, loan products, terms and conditions and the responsibility of becoming a client at Belstar.

Step 7
Risk Assessment

The Risk Assessment Team conducts the assessment which involves a house visit of the member households, verification of the loan application, AGT and GVP report and KYC documents, and recommending the members for loan sanctioning.

Step 8
Loan Sanctioning

The centralised backend team assesses the information received from the field authorities. If all the specified criteria are met, the loans are sanctioned.

Step 9
Loan Disbursement

Belstar opts for cashless disbursements directly to the bank account of the customer. The disbursement process takes place at branch premises after completing the loan documentation process.

Step 10
Loan Utilisation Check

The Loan Utilization Check shall be conducted for every disbursement within 60 days from the date of disbursement, to ensure that the stated borrower has availed and utilized the loan for the purpose indicated in their loan application forms.

Step 11
Loan Management

Repayment collections are received only at the branch office. Any of the borrowers in the group can remit the amount on behalf of the group. The branch accountant accepts the repayment and provides the receipt to the borrower either generated through the system or manually. Belstar functions on a monthly repayment cycle.

Step 12
Loan Closure

Borrowers have the option of terminating their loans before the completion of the loan cycle, in specific cases. No prepayment charges are levied in case of early repayment or on pre-closure of loans.

Life quality improvement for customers

Our intricately detailed model and products are structured so that they help advance our customers from everyday survival to well-laid plans for the future.

500,000+

Customers benefitted

Stories of change

Belstar’s success stories paint the picture of how women have inspired many by beating impossible odds and succeeding on their own for their families, with a little help from microfinance.

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