Janalakshmi

If you carefully look at the consumer base of Janalakshmi Financial Services, you will realise that most of them are not well educated or are at the few steps of the socio-economic ladder. Some of the main advantages that the company offers to its customers are:

• It provides consultation to them at regular intervals and provide a wide variety of loans for different stages of life
• They take into account the ability of the customer to repay the money so that they don’t end up straining their financial budget.
• All terms and conditions, charges and fees are informed well in advance and there are no hidden charges. In this way, before taking a loan, the consumer is able to take a well-informed decision
• The interest rates charged by the company are competitive and any kind of advantage received is passed on to the consumers
• The consumers irrespective of their economic status or education are always treated by utmost respect.
• All personal information of the customers is kept confidential
• There are many ways in which a customer can get in touch with the team at Janalakshmi Financial Services and thus, if there is any kind of problem at any time, consumers can easily reach them.

Retail Loans

Microfinance is the main area of focus of retail lending of Janalakshmi. In the last few years, the company has introduced five different loans to suit the needs and requirements of its various customers.

1. Small Batch Loans

Small batch loans are one of the main products that are offered by the company. This loan is provided to individual women in a group. The size of the group has to be a minimum 5 females and a maximum of 25. Each woman in the group has to give guarantee for the others. There are 5 loans cycles and after the completion of one cycle, the borrower is entitled to move to the next level or borrow the same amount.

The main purpose of this loan is to assist in the generation of income which can be put to any use. The loan size varies from one cycle to the other. In Cycle 1, the amount of loan that is granted is between Rs. 15,000 and Rs. 30,000. In Cycle 2, the amount varies from Rs. 20,000 to Rs. 40,000. In Cycle 3, it is between Rs. 30,000 and Rs. 50,000. The amount is beyond Rs. 50,000 in the fourth cycle.

The loan under this scheme is given 12-24 months for the first cycle and for the subsequent cycles the repayment period is 2 years. An interest of 23.72% is charged on a per annum basis and each and every member is jointly liable.

2. Nano Loans

Janalakshmi Financial Services understands all needs of the urban poor. They not only need funds to cater to their personal needs but also to expand their businesses. For such people, the Nano Loans are introduced. These are individual business loans which allow the businessmen to get financial aid to invest in machinery and equipment and also to increase their working capital. The loan is granted to those with a satisfactory credit history and have taken loan under the small batch scheme and have completed two years.

The loan amount under the Nano loans varies between Rs. 60,000 and Rs.2 lakhs and it is granted for a period of up to 3 years. The interest rate is 26% for all the new Nano loan customers and 25% for the customers who are taking the loan again.

3. Home Improvement Loans

It is not easy for the urban poor to make minor improvements in the house. They need to collect money to do so and this takes a lot of time and the house deteriorates. For such people, home improvement loans are given by the company and assists in speeding up the work of renovations in the house. The loan is granted for extending, improving the structure, renovate or repair the house. Individual needs to have a good credit history to be eligible for this loan. Like Nano loans to get the home improvement loans, the customer should have completed two years if the small batch loan scheme.

Loans for home improvement are granted from Rs. 60,000 to Rs. 1 Lakh and is granted for a period of up to 2 years. The interest charged by the company on these loans is 26% per annum.

4. Jana Kisan Loan

This loan was launched to offer loans to small and marginal farmers and cultivators who have taken land on lease to do farming. The loan helps them increase the productivity of the farm and have enough capital to buy good quality seeds, fertilisers and other necessary equipment. All agricultural and allied activities are covered under the loan apart from vegetable cultivation, dairy farming, poultry, sericulture and maintaining all farm machinery and tractors.

This loan is offered under cycles and the amount given in the first cycle is up to Rs. 50,000 and the second cycle s up to Rs.1 lakh. The loan is offered up to a period of 2 years and the interest rate charged is 22% per annum.

5. Jana Vidya

It is the dream of every person that their children are well educated and are able to do well in life. The beginning of a good education starts from a good school which is still a dream for many parents. The Jan Vidya loans is given to take care of the tuition fee of a school going child. The loan can be used for admission, library, exam fee, purchasing books, stationary, uniforms etc. This loan is offered to customers who are existing customers of the small batch scheme.

The loan under this scheme is granted up to Rs. 50,000 and is granted for a period of 2 years with 24% interest charged per annum.

Loans for Enterprises

Conventional banks and financial institutions have certain criteria before they lend a loan to a business. There are some small businesses which do not qualify to get loans from the bank and are too big to get aid by microfinance. For such enterprises, the Janalakshmi Enterprise Financial Services offer various schemes which are especially designed to provide capital to these companies to grow.

1. Super Nano Loan

This loan is offered to the existing customers who are already using the nano loans. This loan is also given to the micro and small companies who need funds to support their increasing credit requirements. The customers who have a good credit rating and are in the open market are also eligible for this loan.

Loan amount lent under this scheme varies from Rs. 2 lakh to Rs.6 lakhs and the period of loan is up to 5 years. A minimum of 23% per annum rate is charged on this loan and a maximum of 24% per annum.

2. Micro, Small and Medium Enterprises Loan

This loan is offered to the companies in the MSME sector and is in the need of term loans or working capital to expand business and meet the other requirements of a growing business. The loan is offered to customers in selected cities. To serve this group of companies and to assess the eligibility, underwriting techniques and assessment tools are used by Janalakshmi Financial Services.

MSMEs can get loan amount from Rs. 2 lakh to Rs. 50 lakh and is granted for a period of 1 year to 4 years. The company offers flexible payment options, top up loans and part payment facility. A minimum rate of interest of 18% per annum is charged on these loans and a maximum of 26% per annum.

3. Long Term Business Loans

There are many companies in the MSME sector who have capital locked in real estate and are not eligible for loans provided by banks and financial institutions. Janalakshmi Financial Services understand their liquidity needs and provides long term business loans to them. These loans are provided against occupied and self-owned properties. The main aim behind the introduction of this scheme is to provide financial assistance for long term growth and also to keep the EMI affordable so that there is no negative impact on the business.

Loan amount from Rs. 5 lakh to Rs. 50 lakh is provided under this scheme and the repayment period is for a period up to 5 years. A minimum of 18% per annum is charged on this loan and a maximum of 26%.

4. Equipment and Machinery Financing

 For any business to expand and achieve economies of scale, it is needed to upgrade the technology in use. Janalakshmi Financial Services understand this need of Micro, Small and Medium Enterprises and provide them with loans to buy used or new machinery which will make their production process more efficient.

The loan amount granted under this scheme ranges between Rs. 2 lakh to Rs. 50 lakh and the repayment period is up to 5 years.  A minimum of 18% per annum is charged on this loan and a maximum of 26%.

1. Life Insurance for Loans

If a member of a family passes away while he is still repaying a loan from the company, the family gets protection under this scheme. All small batch, MSME and individual loan customers are offered the Group Term Life Insurance Plan. The amount of insurance received under this scheme is same as the amount of loan. This implies that the family of the borrower gets extra capital and also all the outstanding dues are paid off. Janalakshmi Financial Services have partnered with HDFC Life Insurance, Kotak Life Insurance and Bajaj Allianz Life Insurance Company to provide the insurance products. The coverage is compulsory for all the customers who take a loan and their spouse. Also, the customer does not need to pay any additional fee for this, making it an affordable deal.

2. Micro Pension

Janalakshmi, through the India Invest Micro Pension Services Pvt Ltd., encourages its clients to save a small part of their earnings in order to make their retirement and old age more comfortable. The company gives its clients the option to save Rs.100, 200 or Rs.500 on a monthly basis. The scheme is a partial one which also gives the customer the flexibility to do a premature partial withdrawal if needed. The Unit Trust of India manages this fund. The product is sold to the existing loan customers of the bank and is a voluntary scheme.

3. Livestock Insurance for Livestock Loans

It has been noticed that families who maintain livestock to earn money from them are often stressed. A high mortality rate is also associated with the cattle. If customers have taken a livestock loan and the animal dies, the loaner is secured by livestock insurance. The family or the loaner gets extra capital and is also able to pay off the balance loan and this helps them to buy a new animal and continue work. This loan is provided in collaboration with Royal Sundaram Alliance Insurance Company with a simple process. This product is mandatory for all livestock loan users and for enrolling in the scheme, the customers are not charged any extra fee.

4. Home Insurance

Janalakshmi Financial Services provides its EFS and home loan customers with home insurance to secure the residential properties of the clients against calamities like floods and earthquakes. The process to take the loan is simple and is provided in collaboration with Royal Sundaram Alliance Insurance Company. Though it is not compulsory for customers to take this product from Janalakshmi but they have to ensure before the loan is disbursed, the property is insured. It is free for the customers to use this scheme for home insurance.

5. Commercial Insurance

This product is offered to the MSME companies and this covers any loss to building, stock and machinery caused due to burglary, fire, flood etc. The customers do not have to enrol for this scheme as a compulsion with Janalakshmi, though no additional fee is charged for it. The condition here is that before loan disbursal the insurance must be taken from any service provider.

6. Badhti Bachat

There is still a part of the population which has no access to the conventional saving products and thus, saving for them becomes difficult and many do not have a habit to do so. This scheme was started to inculcate the habit to save and is a goal based scheme. Short term goals are set by the customers with help of the team at Janalakshmi and they help them to save in a systematic manner. Goals can include education of children, wedding of daughter, purchasing property, function in the family, business expansion among many others. The scheme has been designed for convenience and ease and suits many different kinds of people. The product comes in daily and weekly variants with minimum saving being Rs.100 and Rs. 500 respectively.

7. Prepaid Card

The prepaid card function in the same way as a debit card though the only difference is that it is not linked to a bank account but instead needs to be topped up and money needs to be added to the card. The card is safe, secure and enables customers to access their money any time of the day. These cards increase the opportunities of the customers to save money and helps them to be familiar with the use of technology. The card also has benefits for the company as it improves their cash management and helps them make new schemes seeing the pattern of spending by customers. The card also enables them to educate about the use banking facilities and ATM cards.

8. National Pension Scheme

The scheme has been launched to secure the future of the people from the unorganised sector and are economically disadvantaged. The scheme has a fixed contribution and is voluntary. The Pension Fund Regulatory and Development Authority has appointed Janalakshmi Financial Services as the aggregator to facilitate registration and collections. As a part of this scheme, for all the customers who contribute Rs. 1000 to Rs.12000 in the financial year, the government also contributes Rs. 1000.

Janalakshmi Financial Services are providing a variety of schemes and products to the unorganised sector of the economy who have limited access to conventional banks and financial institutions due to various reasons. The urban poor needs more financial aid due to paucity of funds. It is difficult for them to make two ends meet and thus, they do not have money for lot of things like education for kids and business expansion. The schemes offered by Janalakshmi not only provide them with the much-needed financial assistance but also helps them grow in life and climb up the socio-economic ladder. The schemes are well designed keeping in mind the specific needs of this segment of the society. The various insurance products also help safeguard the future of the loaner and his family and avoids any financial liabilities.

Janalakshmi also finances urban infrastructure projects and invests in various services to provide better amenities to the growing population of the country. Debt finance is provided by the company for niche businesses and projects which aid in urban development. The company is focussing on sectors like housing, healthcare, education, renewable energy, logistics, transport solutions, waste management solutions and water and sanitation.

The company is doing some commendable work to uplift the lower section of the society and also in the field of urban development. One of the main areas of focus of the company is to provide the customers with the best possible assistance and guidance. The role of the team at Janalakshmi is not to just sell products and services but also to efficiently guide the customers at each level. The idea behind the service is to provide financial aid but more importantly to educate them. Most of these people do not have enough knowledge on products and can take wrong decisions which causes problem to them later. The team at the company is focussed to help them and uplift them and their families in true sense by providing all kinds of help related to their financial and banking needs.