Leasing Details

This paper critically examines the Grameen Bank leasing program but is not a full impact assessment. The paper is divided into the following sections:

• An introduction and review of the financial landscape of leasing;
• A description of the operational aspects of the leasing programat Grameen Bank;
• A case study of one borrower’s experience with the Grameen leasing program;
• An evaluation of the leasing program and its successes and failures;
• Recommendations of new products and practices that will improve the efficacy of the leasing program.

Analysis of program level data and a case study show that the program is successful in terms of outreach and repayment performance. Key conclusions are:

• Poor people have diverse credit needs.
• Different and flexible products are needed to help poor people graduate out of poverty.
• It is possible to issue medium term loans without large down payment to small borrowers.
• Good institutional set-up and a carefully designed product is needed for members to use the product to their advantage.
• Despite the success of the group lending methodology of credit delivery, members within a group have different entrepreneurial ability. New products such as leasing can be used to reward a good member within a group.
• The key to success is constant supervision, monitoring and knowing one’s clients well.

• document (EN)