objective of income-generating loans is to enable SKS members
to generate income, build assets, and become self-reliant.
If members divert the loans for consumption purposes, they
are faced with the additional burden of repaying the loan
with interest without creating any profits or assets. In order
to ensure that members do not fall into this "debt trap,"
the group and sangam leaders, along with the sangam manager,
conduct evaluations of loan utilization within one week from
the date of disbursement.
If the funds are not being utilized for income-generating
purposes, the member has the following two options:
can return the full amount of the loan at the next sangam
meeting, stating the reasons for not utilizing the funds,
can retain the funds for an additional week, at the discretion
of the sangam manager, if she feels that an income-generating
activity can be undertaken
the funds are not properly utilized by the end of the second
week and are not returned at the beginning of the next sangam
meeting, the member is liable for the first installment, including
interest, payable immediately.