Loan Supervision in Micro-credit process

In micro-credit process loan money utilization, the study on investment, as well as overall family status, is known as the loan supervision and this is very important. Because the development depends on the proper investment of the loan received by the members. The member has got the accountability to invest the loan money in the right track as well as other members group leader, staff and the manager have got the responsibility in this respect. This system includes the study on the family members of the incumbent. Supervision does not mean only the utilization of loan money but includes the total status of the same.

Supervision includes visiting the spot of loan money investment; verify the goods in the spot along with the loan in the scheduled meeting. In the meeting, supervision is to be carried out through the group leader regarding the proper utilization of the loan money in the presence of other members. This participation and responsibility of all concerned will be ensured.

After taking loan money, the investment of the same within the specified time is to be ensured. Afterward, all members are to be in touch with each other in this respect. The justification of the loan money investment is to be verified. The somity chief will take special initiative for the supervision. The staff and the other responsible persons will visit the spot and look into the investment periodically. Utilization of the loan will be discussed regularly and necessary steps will be taken in the meeting.

At the time of loan proposal for a member, other members will be sure of the loan purpose and his capacity for investment and then they will give their consent. As the members live side by side will observe the overall activities of each other. If required it will be discussed with the staff including a group leader. Necessary steps will be taken. In the scheduled meetings, they will get together and express their independent opinion regarding the utilization of others loan. They will ensure the supervision of each other’s investment.

The somity chief/ gr: leader after disbursement of loan to the member will be in close touch in respect of proper investment of the loan all the time. He will assist and give instructions to others for keeping the investment in right truck. In the scheduled meeting he will enquire of the loan money utilization and express his opinion. He will take necessary decision. Moreover he will aware the staff and ensure supervision of all other’s loan.

In the micro-credit process if the loan is not supervised properly, it may be affected as follows:

• If the loan is not supervised closely the member will not utilize it properly. So he will fail to develop himself and as such he will not attend the meeting.

• If the loan is not supervised regularly, the loan will not be utilized in the right track and as a result, the members will not be able to pay up installments.

• If the loan is not supervised properly, problems arise in repayment.

• Confidence in each other and the discipline of the group/ somity is hampered.

• Additional work will be created for the staff.

• The member will not remain on the right track.

• General people will lose confidence in the micro-credit process and will conceive the wrong ideas.

  The member will lose his social status.