SUGGESTIONS ON

OPERATION PROCESS PROPSED ( BEST PRACTICES AS PER NBFC)

VILLAGE SELECTIONAfter going through the village selection on operation manual suggestions for village selection;

• CIC’s should have a look on, how many MFI’s working over on that particular village?

• Try to find out the credit history of the village people.

• How many clusters are continuing on that village at the time of village survey?

• Is there the village politically influenced or not ?

• How much safe from natural calamities or harassment and what is the frequency of disasters in a year?

• Why the village was selected by CIC give a remark and the remark will compulsory by CIC.

• After all process will complete by CIC then the approval done by EIC.

• Maintain a file for every village section whether the village will reject or select.

CLIENT ELIGIBILITY CRITERIA• The member may be only women and can make group.

• The annual income of client does not exceed Rs. 100000/- in rural and Rs. 160000 in semi-urban or urban area.(RBI circular)

• Mitrata’s total debt for a client should not exceed Rs.100000/-.

• The loans granted to the borrower for the first time not more than Rs.35000/- and Rs. 50000/- in 2nd cycle.

• She is not a member of any similar JLG or SHG due to repetition of loan product.

• She will not taken more than one loan from other MFI.

• From the cluster meeting place the members home distance should be within 500 meter.

• One cluster start with minimum of 10 members and two groups. i.e 5 members in each group.

• Only that clients should be selected who have satisfied the Poverty index form and income crieteria

CALCULATION OF POVERTY INDEX [PPI]

The link suggests how to conduct a PPI by CICs:-• PPI.docx

CGT & DOCUMENTATION

• Mandatory Group training.

• Selected members will trained for three days. (One hour each day) (organizational information, policies, documentation responsibility, importance of participation, interest rate, loan repayment procedure and JLG concept)

• Members signature will be done during CGT process and one column will be add for

members signature after CGT.

• For three day three time CGT start time and end time column should available in CGT form and accordingly members signature will be done.

• There is no compulsory for a member to came all three days and have an attendance.

CGT first day• Introduction about the company and employee itself.

• The organization's mission and vision.

• Features

• The members of the group shall be the joint responsibility.

• Group

• Know Your Customer (KYC) checks.

• Learning the habits of signature.

• Importance of presence in the meeting.

• pledge

PLEDGEवचन पत्र

 ( सदस् यों हेतु)

हम भगवान/खुदा/ उपरवाले की कसम खाकर वचन देते है किक 1. समय पर कें द्र बैठकों में आयेंगे।

2. ऋण का पैसा जि%स काम के लिलए लिलया है, उसी में लगायेंगे एवं समय पर ऋण चुकायेंगे।

• 3. परिरवार के सभी बच् चों को पढ़ाऐंगे एवं घर को साफ सुथरा व स् वच् छ रखेंगे।

• 4. परेशानी में सेंटर के सदस् यों की मदद करेंगे एवं आपसी सहयोग से किनरंतर उन् नकित करेंगे।

( फील् ड आकिफसर हेतु)

• यदिद आप इन वचनों का पालन करती हैं, तो हम भी वचन देते हैं किक कंपनी पूरी ईमानदारी से, समय- समय पर आप को कंपनी के किनयम अनुसार ऋण प्रदान करती रहेगी।

2nd day of CGT

• The session begins with the introduction of the oath.

• The first day of the characteristics and the member of the group is described as all things including eligibility of the client to be repeated.

• Center leader and leader of the group selection.

• Give an understanding about JLG concept to Centre leader and group leader.

Third day of CGT• The inaugural session. • The first and second day of deliberations in the delivery process to be repeated.

• Give information about correct use of the loan (some economic activity) will be added to, the loans should be in the same act, which information he is given credit form.

• Including group leader another one member or family member will ready to become the guarantors of the client.

• The center leader and CIC prepare the loan applications and make recommendations about appropriate manner.

• The program policies should be based on a discussion of the following points:

• A) the process of providing loans, debt limit• B) All members collective responsibility.• C) A member for life insurance

HOUSE VISIT OF THE CLIENT• House verification checklist should provide to the

CIC for effectiveness in the verification process.

(Group Recognition Test) (GRT)• GRT form need to be re-design with including extra points:-a) Client Id

b) KYC verified or not?

c) Kin-relation verified or not.

d) Purpose of the loan

e) Question answering format should be include.

f) Marking system/ grading system should be implement in order to verified the worthiness of cluster.

g) Signature of both borrower and co-borrower column should implement.

CONT……

• The first stage - mandatory investigation of home (Compulsory House Check).

• Examined Poverty Index and property index and the information provided by CIC is accurate or not.

• KYC’s must be verified with original documents and give the verification seal mark.

• Verify all members know to each other or not.

• A mutual agreement form need to be implement during GRT process and all members signature have to be taken.

• Need to develop a questionnaire for conducting GRT.

Rules for cancel GRT• All members not present.

• If found to be an agent or Middle Men in that cluster.

• If family members don’t know about the loan information.

• PPI and asset information is found to be incorrect.

• The right not to be found KYC.

• During CGT wrong information given in the form.

• Organization rules violation.

DISBURSEMENT• It is necessary to ensure by EIC that the form has been properly investigated, have been

entered in MIS, has been approved and distributed properly and is showing Disbursement Register.

• All documentation part need to be check whether filled up properly or not

• For each member one DPN need to be implement.

• Money denomination column need to be include in the DPN.

• In the receipt part of the DPN borrower, co-borrower, center leader and EIC signature column need to be include in the DPN.

• For disbursement need revenue ticket will be bear by client instead of company.

• During the disbursement again original kyc verification conduct by EIC and the authority of disbursement will not be CIC and it should be given to EIC.

• One loan disbursement sheet need to be implement with EIC and center leader sign.

• All borrower and co-borrowers signature compulsory in the disbursement register.

Seating PatternG-1G-1 G-1

G-2 G-2 G-2

G-3 G-3 G-3

G-1

G-3

G-L-1

G-2

G-L-3

G-L-2

CIC

OUT OF 15 MEMBERS ANY ONE WHO HAVE BETTER LITERCY CAPACITY SHE WILL BE THE CLUSTER LEADER AND THE SELECTION PROCESS DONE BY GROUP MEMBERS.

G-L-2/ CLUSTER LEADER

CLUSTER MEETING• Avoid meeting place in cluster leader’s home.

• Cluster leader rotation and meeting place rotation need to implement in second cycle.

• For each cluster one sitting pattern should be followed.

• The cluster meeting time should be match with CDS data shown in the BIJLY.

• Center meeting policy need to be implement.

ELIGIBILITY CRIETERIA FOR 2ND CYCLE LOAN• 2nd cycle loan need to be disburse to the client based on the

attendance during the cluster meeting:-

• Attendance less that 50% ( Not eligible for 2nd cycle loan)

• Attendance 51-70% ( eligible to 1st cycle loan amount)

• Attendance more than 70% ( eligible to higher amount of loan as compare to 1st cycle).

( Tracked through collection sheet signature )

REGISTERS & FILES• Files: -• Circular: - All circular received from Head office to be file properly.• Center: - All the center files should be well maintain and should be in safe custody.• Fixed assets File: - All Fixed Assets bills should be in file and well maintained.• Salary File & Incentive: - All the salary & incentive files should have monthly data and

print out of the same should be in register.• Legal: - Rent Agreement should be in file and renewal of the same should be

reminder.• Insurance: - All the document of member death should be available in insurance file.• Disbursement file• Village survey file• Voucher file(day book)• LUC files• Leave application files• Repayment file• Accounting report MIS file.• Audit compliances file

CONT….• Registers:-

• Cash book.• Petty Cash: - All the petty cash transaction should be maintain accordingly.• Fixed Assets: - All the fixed assets at branch should be align and maintain and physically

tallied.• Insurance Claim: - Payment detail of all members should be written down clearly.• Bank Register: - All the transaction regarding bank should be maintain.• Foreclosure: - All the fore closer entry should be done on same day in register with client and

center name and id. • Cancelled Cheque: - All the cancelled cheque should be maintain and pasted in Register.• Advance cheque signed• Monitoring/Visitor Register• Inward/Outward Register• Weekend Meeting Register• Attendance Register• Key movement Register• Leave Record Register• Collection Register

DEATH CASE CHART

Death of

client

CIC inform to EIC

Visit conduct by EIC

Death certificate

submit by

client

Inform to HO by EIC

and docum

ent submit in HO

Settlement

process

conduct by

insurance

company

receiver’s sign

and payee sign

done in

register

Date of

settlement update in

regd.

MONITORING & SUPERVISION• PAR client’s actual house visit should be monitor by

EIC and AIC. After that the status should record in a register.

• EIC will must visit 3 cluster meetings in a repayment day and it should cover different CIC.

• AIC will must visit 20% of the EMI collection meeting and 25% of GRT including all EDCs in every month.

STAFF PRODUCTIVITY • Staff performance of Pandit Nagla (EDC) since last 3 months.• Total amount disbursement: Rs.2405000/-(Oct. 15)• Total amount disbursement : Rs.2385000/- (Sept. 15)• Total amount disbursement: Rs. 2235000/- ( Aug. 15)• Total number of CIC on Pandit Nagla EDC:- 8

NAME OF THE STAFF AUG 15 DISB. AMT. SEPT 15 DISB. AMT. OCT. 15 DISB. AMT.

ARUN KUMAR SAINI

BRIJ MOHAN

KAPIL KUMAR

LAKHPAT SINGH

MUKESH VERMA

SHALINI SAXENA

TABASSUM YAMEEN

VISHAL THAKUR

220000( 16 Client)

75000 ( 6 client)

180000 ( 12 client)

695000 ( 48 client)

265000 (16 clients)

295000 (21 clients)

260000 ( 18 clients)

245000 ( 19 clients)

305000 (27 clients)

75000 (4 clients)

395000 (23 clients)

440000 (29 clients)

70000 (4 clients)

595000 ( 41 clients)

375000 ( 25 clients)

130000 ( 9 clients)

435000 (33 clients)

245000 ( 14 clients)

185000 (11 clients)

145000 (10 clients)

240000 (16 clients)

690000 (47 clients)

155000 ( 10 clients)

310000 (24 clients)

SUGGESTIONS & RECOMMENDATIONS

• LUC will conduct within 15 days of the loan disbursement.

• EIC will conduct 50% of the LUC and CIC will conduct 50% of the LUC.

• Loan files should be arranged month wise instead of staff wise.

• Grievance redressal Mechanism must be maintained in the branch.

• Mission, Vision, code of conduct, fair practice, display board and complain box should be available in the branch level.

• All assets must be number sequentially with coding provided by national office.

• Collection sheet given in the same day of the collection.

• Suggest for add a column in the loan card for client signature.

CONT….• Bank deposit slip register must be maintain in the division office.

• All voucher and supporting documents need to be attach any financial transactions done in the field level.

• Bank statement regularly provide by HO and it was maintain in a proper file at division office level.

• One register need to be maintain for tracking block listed areas and ring leaders.

• Ink specification need to be implement for smooth documentation.(blue, green or black).

• If client closes loan then a loan close seal should be done by EIC and the pre-close process should be conduct in the EDC level.

• If salary given to the staff in cash then revenue stamp attach in the voucher.