Loan Eligibility Requirements

1. The 6-Month Saving Rule

To be eligible for any loan product, you must be an active member and save consistently for at least six (6) consecutive months prior to your application.

2. Required Saving Percentages

Your loan limit is determined by the amount you have saved. You must meet the following thresholds:

• For Most Loans: You must have saved 25% of the total amount you wish to borrow (includes House, Business, and Social savings).

• For Vehicle Loans: You must have saved 40% of the requested loan amount (includes Automobile and Commercial car savings).

3. Documentation Checklist

When applying, please provide the following:

• Identification: A renewed Kebele ID, Passport, or Driver’s License.

• Photos: Recent passport-size photographs (usually 1–2).

• Proof of Income:

  • Employees: A formal letter from your employer stating your salary and employment status.

  • Business Owners: A renewed trade license, TIN registration, and tax clearance. A bank statement or cash flow statement for the last 12 months may also be required.

• Marital Status: If married, your spouse must be present to sign the agreement. If single, legal certification of your status is required.

4. Collateral & Security

All loans must be fully secured. Acceptable forms of collateral include:

• Guarantors: At least one (often two) fellow member(s) of the SACCO who will co-sign and pledge their savings as security.

• Fixed Assets: Legal title deeds for houses or land.

• Vehicle Titles: Fully insured vehicles (for car loans).

• Salary: Some loans may be secured against a permanent employee’s salary (with a minimum income threshold).

5. Service Fees

Members should be prepared to cover:

• Service Charge: Typically 1% of the loan amount.

• Insurance: A 1% fee for Micro-Life Insurance to protect you and your family in case of unforeseen events.