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All the Microfinance organizations in Honduras seem to follow the Grameen model for lending purposes, in this model an organization assigns a number of officers to a community to familiarize with the situations on ground and gather loan applications. Once the loan applications are reviewed they decide on potential borrowers (usually the limit is 5 people) and form a group of with all them as members. Then they give money to 2 members of the group (the loan could range from anything between $50 to $5000) and monitor repayments for a two year period. If the two borrowers do return the money on time they extend the loans to everybody else in the group, this dynamics creates a peer pressure among the borrowers to make payments on time.
More information is available on microcredit models that may be applicable to AguaClara.
How can Microcredit can be used to help AguaClara?
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