Kerala Vishwakarma Co-operative Credit Society Ltd, shortly referred to as KVCC was formed in 2000-01 with an aim of providing loans for the needy in our community. Over a period of time investments in KVCCL grew in the form of Fixed Deposits, Recurring Deposits, etc. It was estimated that our community members badly need funds for their various requirements. KVCC has been extending personal loans, educational loans, housing repair loans, etc. It had also been providing loans for marriages, education, etc.

Business, not charity KVCCL offers various types of loans at a nominal rate of interest to salaried individuals and growing businesses that lack access to conventional forms of credit. It is committed to the economic and social development of its borrowers and to promote our community’s economic growth. While there is clearly a social component to this initiative, it is not a philanthropic initiative. The majority of the loans are given to the members considering their repayment capacity.

Risks

KVCCL faces a number of risks in the lending arena. Although informal lenders charge much higher interest rates, they also give loans much more easily (with a simple phone call it is possible to have a loan approved and the money delivered immediately). KVCCL must ensure that it effectively communicates the benefits of its products and services and positively differentiates itself from the informal lenders.

Finally as with any other lending institutions there is always an issue of default risk. Here KVCCL has number of procedures to mitigate that risk, checking on its potential clients and requiring guarantors. It keeps track of individuals that have defaulted on loans, which helps in scrutinizing the status of individuals availing the loan.

Opportunities

Although our community had easy access to other credit lending institutions or informal lenders (with much higher interest rates and securities), KVCCL providing credit facility to our community with a nominal rate of interest with two guarantors, thereby developing a situation that meets both KVCCL’s risk reduction and customer’s need for finance.

In response to the challenge of continuing to grow its client base, KVCCL has formulated some plans with its parent association KVA in the near future. KVCCL would continue to innovate its product, focusing on maintaining efficiency as well as increasing the effectiveness of its products and services in reaching its target.