Section 1. LENDING POLICIES & GUIDELINES
These lending policies and guidelines will be the bases for the approval / disapproval of any loan application to the Productive Loan service program of the BBSAMAMUCO as provided for in its by- laws and approved internal policies, subject to amendments, for the better to its members.
1. The Credit Committee (CRECOM) shall have the responsibility of interviewing, assessing and approving the loan application of the members, except when the applicant is a member of the said committee, under which circumstance, it is the Board of the Directors who will act on the application. (Article V Section 8).
2. A member’s application may be acted on favorably based on the following:
a. Individual record of payment (both in the term and manner as reflected in the contract).
b. Purpose of the loan application. It has to be for capital / additional capital for a small business.
c. The amount of the loan as against his share capital; guarantee of a 2 co –maker or savings / time deposits.
d. The initial loanable amount shall be X2 the member’s share capital up to his 3rd loan; on the 4th loan, it will then be X3 the share capital, provided that the previous loans have been paid according to terms and manner of payment signed in the contract. (The CreCom approve the policy that if a member is delinquent for more than one year, the share capital should not be X3)
e. The CRECOM shall have the authority to assign the amount to the member as they see fit all policies considered.
3. Terms And Manner Of Payment:
a. The terms of payment shall be : 30 days ( 1 month); 60 days ( 2 Months ); 90 days ( 3 Months ); 120 days ( 4 Months ); 150 days ( 5 months), and 180 days (6 months).
b. Payments may be made daily, weekly, semi-monthly, or monthly.
4. Interest on loans, service charges and Return to Capital shall be deducted in advance to ensure the availability of funds at all times. The percentage of these deductions are as follows:
5. Rebates, Fines and Penalties
A member who pays ahead of his payment due will be entitled to a rebate: the formula is as follows:
Principal X Rate X Remaining days
Total No. of days
A member who is delinquent in his payment, both in his monthly dues or due date, shall be subjected to the following fines and penalties: a) 2% fine his monthly balance due; b) 2% on the remaining balance when the date is due; c) a member who has missed in his payment may be given less 10% of the loanable amount; and d) the member’s right to borrow may be suspended for a month or two, depending on the number of times he has been delinquent in his repayment.
A member may ask for a Restructuring of his loan on due date if necessary to avoid being delinquent. This provides for the signing up of a new contract. He would have to pay the interest on the loan due to the new contract. No service charge will be collected in this scheme Restructuring can only be granted once for every loan and application shall be filed before or on the due date.
A delinquent member cannot sign as co-maker of another.
6. Capital Build-up
In order to participate in the continuous capital build-up of the cooperative, a member is allowed to voluntarily add to his share capital, the amount of P 1,500.00 per month. This is apart from the 5% deduction made every time he makes a loan. As for our amendment of Article IV, each member should accumulate additional Share Capital of one thousand two hundred pesos (Php 1,200.00) per year or one hundred pesos (Php 100.00) per month.
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