CreditAccess Grameen Limited, formerly named (Grameen Koota Financial Services Pvt. Ltd.) was set up to provide affordable loans to the economically backward sections of the Indian society.
CreditAccess Grameen is now a Non-Banking Financial Company – Micro Finance Institutions (NBFC-MFI) entity that is registered with the Reserve Bank of India (RBI). The operating brand name of the company is Grameen Koota.
The organisation offers financial and non-financial services/products to its target customers. The financial products offered by the company are detailed here.
The financial services/products offered by the company can be classified into three main categories:
This category includes the following types of loans:
The short-term loans from CreditAccess Grameen can address the financial emergencies of borrowers. This protects borrowers from resorting to alternative sources of funding, which may include informal loans that can be very expensive to repay.
| Loan Amount | Up to Rs.1,000 |
| Interest Rate | 18% p.a.* |
| Loan Tenure | Up to 3 months |
* Calculated on the basis of declining balance
These loans can be availed by borrowers for the fulfillment of their genuine financial needs. One can take a family welfare loan to purchase a bicycle, cooking stove, water purifier, or solar lights. It can also be availed to fulfill the medical expenses or educational needs of borrowers.
| Loan Amount | Rs.1,000 to Rs.15,000 |
| Interest Rate | 18% p.a.* |
| Loan Tenure | 24 weeks to 52 weeks |
* Calculated on the basis of declining balance
These loans can be taken by customers for the extension of their houses, procurement of water connection, or construction of toilets.
| Loan Amount | Rs.5000 to Rs.50,000 |
| Interest Rate | 18% p.a.* |
| Loan Tenure | 52 weeks to 208 weeks |
* Calculated on the basis of declining balance
These loans help in supporting businesses and other such income-enhancing activities. The additional working capital needs of businesses can also be met using income generation loans.
| Loan Amount | Up to Rs.60,000 |
| Interest Rate | First loan – 21% p.a.* Second loan – 19% p.a.* Supplement loan – 19% p.a.* |
| Loan Tenure | 52 weeks to 104 weeks |
* Calculated on the basis of declining balance
Retail Finance was introduced by Grameen Koota in the year 2016 to provide individual loans to existing borrowers who have high entrepreneurial capabilities. Borrowers who have emerged successful from the group lending model can also avail these loans. The purpose of these loans is usually the expansion of existing businesses, purchase of machinery/inventories, or working capital funding.
The loan products offered under retail finance are listed below:
These loans are offered to borrowers to purchase two-wheelers that can be used in income-generating businesses.
| Loan Amount | Up to Rs.60,000 |
| Interest Rate | 22% p.a.* |
| Loan Tenure | 24 months |
* Calculated on the basis of reducing balance
These loans are offered to individual customers who require higher loan amount to meet expenses related to the expansion of businesses or acquisition of new machinery. Working capital needs can also be met through this credit.
| Loan Amount | Up to Rs.1,25,000 |
| Interest Rate | 22% p.a.* |
| Loan Tenure | 24 months |
* Calculated on the basis of reducing balance
These are intermediary loans that are taken by customers for the fulfillment of additional needs that may arise in a business. For instance, a Grameen Suvidha loan may be taken for the upkeep of the inventory of an income-generating activity.
| Loan Amount | Up to 15% of Savaari/Udyog loan amount that has been sanctioned |
| Interest Rate | 20% p.a.* |
| Loan Tenure | 6 months |
* Calculated on the basis of reducing balance
These are business loans that are provided to borrowers with the requirement of very high loan amount for the expansion of their businesses or the purchase of new inventory.
| Loan Amount | Up to Rs.5 lakh |
| Interest Rate | 22% p.a.* |
| Loan Tenure | 24 months to 60 months |
* Calculated on the basis of reducing balance
This category includes the following:
Grameen Koota has tied up with three leading insurance companies in India to offer insurance protection to borrowers and spouses/co-borrowers who avail credit through the company’s retail finance schemes. Maximum life insurance coverage under this service can go up to Rs.5 lakh.
This product extends the National Pension Scheme (NPS) coverage to the weaker sections of the society. This takes into account the limited investment potential of the beneficiaries. The aim of the scheme is to prevent poverty in the later stages of the lives of the beneficiaries. The scheme does not mandate yearly/monthly deposits; the contribution of each member is based on his/her financial capacity. Training sessions have also been designed by Grameen Koota to educate the beneficiaries under the scheme on the advantages of enrollment.
CreditAccess Grameen offers several non-financial products for the upliftment of its target customer base. This includes imparting financial literacy to customers, mobilising sanitation and water projects, and implementing other such social initiatives.
The inspiration behind the organisation was the remarkable success achieved by the poor in Bangladesh during the microfinance movement, facilitated by Professor Muhammad Yunus. CreditAccess Grameen was set up in May 1999 in Bengaluru, Karnataka, with a vision to replicate the microfinance model that found success in Bangladesh.
The organisation provided collateral-free loans to the financially underserved, with special focus on women. The motive was to create equal opportunities for the urban and the rural poor. The credit offered by the organisation was targeted at improving the standard of living of the poor and breaking the vicious cycle of poverty. Although the group lending model was implemented at the beginning, a class of financially-literate women emerged from these experiments as established entrepreneurs. They outgrew the group lending models soon after.
The target customer base of Grameen Koota were women, as studies found that they were more disciplined in handling credit acquired for activities related to community and economic development.
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