Exploring the connections between business, development and transformation: How important are social entrepreneurs for economic development?
Clients with strong references receive an application; careful track is kept of who receives them. If, upon review of the application by the Credit Committee, the customer is deemed to be an acceptable credit risk, preliminary approval is granted. A site visit is made to interview the customer, verify application details, and review collateral.
Clients provide all necessary paperwork—including signatures and guarantees. The complexity of this process depends on loan size. Larger loans, including taxi loans, can take months because of the due diligence involved. It includes a police record review. The process is uniform and straightforward to ensure all customers receive the same treatment.
Operations Prisma's operations and management has five years of successful, profitable lending experience in the Nicaraguan market. The company has developed successful activities for ensuring it is providing excellent service and developing strong relationships with solid customers, ensuring that the loans will be repaid.
Prisma conducts business in a highly professional and open manner.
The company's philosophy is centered on knowing customers, working with them to be successful, making sure they understand how their loans work, and rewarding good behavior. Customers are classified from A-D based factors including: The taxi co-ops are classified according to the same criteria by each co-op as a group.
There are rewards and tangible benefits for "A" customers, knowledge of which is spread among customers through word of mouth. Balanced and Cost-effective Loan Portfolio: The existing relationship with Taxi Cooperatives provides an inroad for nationwide market penetration.
Microfinance industry data indicates loan officers can manage loans at one time. Therefore, because the breakeven point for an additional lender is low, Prisma can financially afford to have a balanced portfolio with an equal number of micro and small loans.
Although smaller loans are less lucrative, they are financially viable for the business and promote the social mission of ensuring there is access to credit for all.
In addition, they provide the benefits of being repaid faster, requiring less due diligence, and producing a high number of referrals.
Hand-held Technology and Centralized Due Diligence: In order to minimize infrastructure costs, back-office support for loan officers will be centralized. Loan officers will utilize advanced technology to conduct their business.It is a foundation responsible for the replication f the Grameen model across the world It allows participants to obtain a deep knowledge of the functioning, philosophy and methods of Grameen and provides them with the knowledge of particular problems.
Budding social entrepreneurs could do worse than look to the founder of the Grameen Bank for Muhammad Yunus: the model social to your business model. Grameen Bank concept was born in the village of Jobra, Bangaladesh, in Professor Yunus, nobel prize winner for peace in , had a field visit with his students.
Yunus Social Business is a Philanthropic Venture Fund. We turn donations into investments in sustainable social businesses that provide employment, education, healthcare, clean water and clean energy to over 5 million people worldwide. The Creditworthiness of the Poor: A Model of the Grameen Bank Michal Kowalik Federal Reserve Bank of Kansas City David Martinez-Miera Universidad Carlos III Madrid.
The Creditworthiness of the Poor: A Model of the Grameen Bank Michal Kowalik Federal Reserve Bank of Kansas City David Martinez-Miera Universidad Carlos III Madrid.