Group loans: credit for groups of people in Mexico

Group loans are a type of financial product designed to help realize the entrepreneurship of a group of people, usually women. chiuderemorini.net for a critique

The idea behind these types of credits is that people get the means to undertake, and thus help their families financially to have a better quality of life.

The financial companies that grant group loans are usually private equity or online loan companies. But it is also common to find this type of financing from government agencies.

Currently there are more and more banking institutions that are encouraged to grant a financial product of this type.

Before applying for a group loan, make sure you are part of a group of responsible people with sufficient financial capacity to pay the fees.

Group loans for women

Group loans for women

The credit companies that grant group loans for women know well that in many cases they are the economic engine of their family environment. For that reason they decide to invest in sponsoring their business ideas.

Usually it is the public bodies that finance women with group loans. In Mexico, for example, there is CAME, an organization that functions as a microfinance company to provide loans and savings tailored to its clients. That agency also offers funding to groups of men or mixed.

Requirements to access a group loan in Mexico

  • Groups should usually be made up of 5 to 30 people
  • All group participants must be between 18 and 65 years old
  • Usually they must provide 10% of their savings as collateral
  • They need proof of address for each member and a principal
  • They must provide the necessary and current personal documentation
  • They have to verify that the loan will be used to start a business

Group loans of 5 people

Group loans of 5 people

Groups of 5 people are the minimum allowed by financial companies to access this type of loan. Usually the same amount of money is given to each of the members.

The idea behind all this is to be able to form together the capital necessary to start a business.

Try to group with people from your same family environment or trusted friends, and with the same needs and desires to obtain a better quality of life.

Group Credit Risk

Group Credit Risk

One of the main risks of the group loan is the fact that all members of the group must comply in time with the payment of fees. Debt is managed in a group and not individually.

Also consider that the percentage of interest is multiplied by the number of people requesting the loan. If the credit includes 1.5% interest per person and the group is 5, they will pay 7.5% monthly.

Each person acts as a guarantee of the other, so it is necessary to request it with people of complete trust. If one of the members does not pay, everyone can be reported to the Bureau.

Establish a group of finance managers that controls payments and ensures that everyone meets the deadlines.

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