Joint Liability Groups (JLG) Loan

Provided by the bank to a group of individuals (usually 4–10 members) who jointly take responsibility for repayment. The group members provide mutual guarantee for the loans availed by each member, enabling access to formal credit even without land title or other security. This mechanism is widely used in rural credit programs to support small and marginal farmers, tenant farmers, oral lessees, sharecroppers, rural micro-entrepreneurs, and others in similar economic activities.

♦  Promote financial inclusion by extending institutional credit to underserved rural clients.
♦  Support *agriculture, allied activities, non-farm enterprises, and income-generating activities* without requiring collateral/security.
♦  Build credit discipline and peer support among group members.

Who Can Form a JLG?

While Sabarkantha DCC Bank’s specific eligibility details are typically provided at the branch level, Joint Liability Groups generally have the following membership norms (common across banks offering JLG loans): ([Wikipedia][2])

✔ 4 to 10 members
✔ Members should be from the same village or neighbourhood and similar socio-economic background
✔ Members should be engaged in income-generating activity (agri or non-agri)
✔ Members must trust and mutually guarantee one another for loan repayment
✔ Members with past loan defaults are usually not eligible to join the group

Loan Features

While exact figures are finalized by the bank and may vary by policy, typically JLG loan features include: 

Collateral / Security

♦  No collateral/security required — loan is backed by mutual guarantee of group members.
♦  Primary risk coverage is the *joint liability undertaking* of the group.

Loan Amount

♦  Individual members can receive credit based on their activity and repayment capacity.
♦  Many cooperative and district banks offer up to *₹1,00,000 per member, and the *group limit often aggregates to a higher total (e.g., up to ₹5,00,000 or more depending on bank policy). Exact limits should be confirmed with the bank.

Interest Rates

♦  Interest rates are decided by the bank as per internal lending policy and may be subject to regulatory guidelines.
♦  Cooperative banks generally offer competitive priority sector rates to small farmers and rural entrepreneurs.

Repayment Period

♦  Repayment tenure usually depends on the purpose of the loan — short-term for crop/working capital and longer stretches for investment activities.

Documents Needed

While Sabarkantha DCC Bank will require specific forms, banks typically ask for:
📌 KYC documents (Aadhaar, Voter ID, PAN, etc.)
📌 JLG membership and formation documents
📌 Loan application form
📌 Joint Liability Group agreement (inter se agreement)
📌 DP Note (Demand Promissory Note)