Bangalore-based NBFC-MFI Grameen Koota Financial Services Pvt Limited (Grameen Koota) on Thursday, slashed interest rate by 200 basis points (2 percentage points) for education, water and sanitation loans, as part of its social objective to pass on benefits to its borrowers.
Apart from this, Grameen Koota has already reduced the core income generating loan rate by 1% from 25% to 24% from October 12, 2015. With this Grameen Koota borrowers will get education, water and sanitation loans at 20%, a significant reduction of 2% from 22% they were charged earlier. The new rates of interest will come into effect from November 1, 2015, for all future disbursals.
|Table: Grameen Koota Loans Distributed in Last 3 Years|
|No. of Loans Disbursed||Amount Disbursed (Rs. Cr)|
This is the second interest rate cut by Grameen Koota since May 2014. The reductions are consistent with the Company’s decision to pass on the cost advantages accruing from reduction in the cost of borrowing, economies of scale and operational efficiency, to its borrowers. With 20% interest rate, Grameen Koota’s loan rates become one of the lowest rates charged by the Microfinance Institutions.
“It’s always been our endeavour to pass on the benefits to our customers. Even when we could charge 26% of interest on all products, we have been charging only 22% for socially focussed products like education, water and sanitation products to support our customers. With borrowing costs coming down and increasing operational efficiency, we wish to keep passing on the benefits to our customers,” said Grameen Koota Managing Director and Chief Executive Officer Mr. Udaya Kumar.
Grameen Koota is one among the few in microfinance sector with a top grade of ‘mfR1’ by CRISIL for its Quality and high Credit rating of ‘A-‘ by ICRA among MFIs in India, with more than one million customers and a portfolio over Rs.1,600 crore.
About Grameen Koota:
Bangalore-based NBFC –MFI, Grameen Koota Financial Services Pvt Ltd (Grameen Koota) with 298 branches spread across Karnataka, Maharashtra, Tamil Nadu, Madhya Pradesh and Chhattisgarh, has more than one million customers, with a portfolio of over Rs.1,600 crore.
Grameen Koota is one of the 5 financial institutions in the world and one of the 3 microfinance institutions (MFI) in India to have been honoured by Smart Campaign for having met all the client protection principles. It is also one of the few MFIs to be awarded with Truelift Certification of ‘Achiever’s level’ and Social Rating of Σα (alpha) for its commitment on social performance and pro-poor business. Grameen Koota is one among the few with a top grade of ‘mfR1’ by CRISIL for its Quality and high Credit rating of ‘A-‘ by ICRA among MFIs in India.
Grameen Koota has been working with Joint Liability Groups formed exclusively of women belonging to poor and low income households by providing them with financial literacy and diverse credit products, catering all life-cycle needs such as income generation and access to water, sanitation, education, health care, home repairs, emergency loan etc. It gives its clients the option to repay weekly, fortnightly or monthly, depending on their cash flow and convenience. Grameen Koota’s social awareness campaign ‘Jagruti’ has become an important source of information across its customers over a period of time.
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