OUR LENDING METHODOLOGY
The OXUS Group’s microfinance institutions (MFIs) in different countries seek to adapt their methodology to the specific context in which they operate. Nonetheless, the lending policy applied by OXUS MFIs is consistent with a set of commercial and ethical principles.
Recently, OXUS MFIs have been developing their activities in urban areas where small businesses grow more rapidly. However, the OXUS Group remains strongly attached to its development mission, and as a result plans to stay well implanted in less accessible, rural regions.
A variety of loan products
OXUS MFIs strive to adapt their financial products to fit the specific needs and requirements of their clients. As a result, OXUS products vary from one country to the other; their specific conditions are regularly modified and updated.
Generally, all OXUS MFIs offer at least two categories of products:
Small credit group loan
The Small Credit Group loan (SCGL) was the first of ACTED’s microfinance products, and it remains very well adapted to rural areas, where access to credit or deposit facilities is most limited. Potential clients form groups of four to six individuals, and jointly submit a loan application. Each member of the group is responsible for his or her own loan repayment, but members agree to guarantee each other’s loans. Nowadays, SCGL still account for over a third of OXUS MFI disbursements.
Individual business loans
Individual Business loans (IBL) have been designed to be flexible and match the exact needs of OXUS customers. Potential clients for these loans already have a good knowledge of financial products and solid experience with their enterprise. IBL require the provision either of goods or equipment that can serve as collateral, or of one to two other individuals willing to serve as guarantors. The amounts of individual business loans at OXUS generally vary between $100 and $50,000, with the average loan amount being about USD 680.
OXUS loan cycle
OXUS is engaged in offering prospects and current clients the most adequate products or services, following the analysis of their needs and capabilities.
Anay individual or company with an income generating activity, satisfying the institution’s eligibility criteria’s and in line with OXUS’s mission, can access to a loan. credit decisions are made based on objective criteria and independently from the loan officer assisgned to a client. Furthermore, the first loan is probationary to understand the business activity and the needs of the client.
Proper procedures enable OXUS to analyse and monitor its activity to ensure a high quality portfolio. OXUS lending methodology follows a precise cycle of 12 stages. OXUS MFIs’ Loan Officers are available to assist applicants and clients through all the necessary steps, from the loan application to the reimbursement.