Financial Services

The types of activities which are of financial nature and in line with the vision of the organization such as micro credit is what we offer.

1. Economic growth: The funds mobilized by the Community - Based Organizations, Community Development Associations through their members are channeled into productive investments by providing various services to people in general and corporate enterprises in particular. The economic growth of any country depends upon these process and investments.

2. Promotion of savings: The funds mobilized by the Community - Based Organizations, Community Development Associations providing transformation services. That is, it provides liability, asset and size transformation service by providing huge loan from the small deposits collected from a large number of people. Through this way the CBOs, CBAs promotes savings in the economy.

3. Capital formation: Capital formation is the very basis for economic growth.

4. Creation of employment opportunities: The financial services create and provides employment opportunities to millions of people all over the world.

6. Provision of liquidity: The financial service process promotes liquidity in the financial system by allocating and reallocating savings and investment into various avenues of economic activity. It facilitates easy conversion of financial assets into liquid cash.

In a pragmatic nature, CDF doesn’t mobilize individual savings from individual clients but it is done by encouraging the members of the cooperatives being served by the organization. Direct lending is one of the financial services tools employed by CDF to serve the CBOs, CDAs, CBAs, Cooperatives etc.

Direct Lending involves the provision or commitment to provide fund on an unsecured or secured basis to a debtor who is obliged to repay on demand, fixed on a determinable future time, the amount together with interest and or fees thereon. The Foundation provides this credit to re-finance the loan portfolios of grassroots development organizations, microfinance institutions, and other rural institutions providing services at the grassroots levels.  There are two main products under the financial services namely: Revolving-on-lending loans (This is the direct loan given to an organization to lend to its member groups and individuals. It attracts an interest charge of 2% per month on reducing balance and has a duration of 12-18 months in line with the Terms and Conditions). The Enterprise loans (These loans are designed for group projects. It attracts an interest of 30%pa and has a duration of 18-24months).

Success Recorded since the beginning of the Direct Lending Program

Another financial service provided by the foundation is the Institutional Capacity-Building and Technical Assistance: We provide this service to support the institutional capacity development of grassroots-based institutions that support the rural poor and their communities. A participatory organizational self-capacity assessment initiative (POSCA) is being employed as a capacity-building intervention strategy to strengthen organizational systems, outreach, growth, and sustainability. Other technical support services provided include the provision of business development services, record keeping, operational procedures, and policies for needy clients. These are supported through grants and represent the seed development fund that prepares the ground for the long-term sustainability of the institutions.

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