Product Rules

Product Rules for P9 Hrishipara were revised for a second time in 2013 and are given below.

Notes:

The original rules were written in early 2007 and revised for the first time in 2012: these earlier version may be obtained by contacting us directly.

Product rules for two other versions of P9 can be obtained by contacting us directly. They are: P9 in Kenya (Jipange Kusave) and P9 in Kalyanpur, Dhaka (closed 2013).

Rules for Hrishipara P9 effective late 2013

The Basic P9 account is designed to offer poor households, who find it difficult to save, a quick way to build up savings.

As of late 2013 P9 has been strengthened with the addition P9 Special Savings. This is a savings account that offers interest, and therefore offers a longer-term home for savings accumulated in the basic P9 account.

Also as of late 2013 we have added an interest-bearing loan product, P9 Special Loans. It is offered selectively to clients with reliable cash-flow streams from sound businesses or from regular wages or salaries.

As of late 2013 all P9 clients, without exception, hold the Basic account; all clients may also open the Special Savings account, while selected clients only may open a Special Loans account.

Shohoz Shonchoy P9 Basic account

Would you like a very cheap way to borrow money interest-free, and to build up large savings very quickly? Then try our new P9 Basic account. It suits all sorts of people, like small-businesspeople, salaried workers, casual labourers, the unemployed, housewives, students and children.

Interest free loans

As soon as you open your account you can take an interest-free loan of 4,000 taka. When you have repaid it in full you can take another bigger loan, and when you have repaid that one you can take an even bigger loan. Loans rise in value each time as follows:

4,000, 5,000, 6,000, 7,500, 9,000, 13,000, 18,000, 25,000, 35,000, 50,000 – and more!

These are the maximum amounts allowed but you can take a smaller loan if you want to. All these loans are interest-free, and you repay them whenever you like.

If you need extra cash while you are holding a loan, you can ‘top up’ your loan before you have completely repaid it. Suppose you took a loan of 12,000 taka, and you have already repaid 5000 taka: now you can take 5000 taka again if you want to.

Quickly build up your savings

Each time you borrow you put 40% of the loan value into a savings account held by us in your name. When you have saved at least 20,000 taka you can withdraw it and use it as you wish, or you can go on borrowing and saving even more.

You can also withdraw your savings before they reach 20,000 but in that case you must pay a fee of 5% of the value of the savings – this rule is to encourage you not to withdraw before your savings have built up to a good amount.

After withdrawing your savings you start again from the 4,000 taka loan, and save another 20,000 or more!

When you take a loan top-up, you put only 10% of it into your savings (you can put more if you like).

Operating the account

You must visit our office to take loans or top-ups: that is also the time you make your savings deposits. Then we will send a collector to your home or workplace every few days to collect your loan repayments. She will come at a convenient time, as often as you like. You don’t have to make a repayment every time she calls, but we advise you to repay as quickly as you can, to get bigger loans sooner, and grow your savings faster. Our service is personal: there are no meetings or groups, so you never waste time and you are never responsible for other people’s loans.

Costs

The loans (and top-ups) are completely interest-free. When you open an account you must pay an account opening fee of 200 taka. This 200 pays for your passbooks and photo, and also for insurance, so that your loan is forgiven if you die when you still owe us more money than you have in your savings.

Each time you take a loan or top-up you pay a disbursement fee of 3% of the loan or top-up, which pays for the cost of the visits by our collectors.

Note: if you do not take any of your loan in cash, but pay all of it immediately into your savings account, you pay no disbursement fee at all!

You make no other payments. Loans and top-ups are interest free. We will never ask you to pay anything except 200 for account opening (once only), loan and top-up disbursement fees, and a withdrawal fee if you take your savings before they reach 20,000 taka.

Shohoz Shonchoy P9 Special Savings – for profitable savings

Our P9 Special Savings account pays 6% a year profit on savings of more than 2,000 taka. You can deposit and withdraw whatever amount you like at any time: you can save with our P9 Collector or at the office, and you can withdraw up to 500 taka from our staff at your doorstrep or bigger amounts at our office. If you like you can transfer P9 Basic savings into P9 Special Savings in order to earn profit. To do this, just withdraw the money from your P9 Basic account and ask our manager to put it in your P9 Special account. (Remember that when you withdraw savings from your P9 Basic account your next P9 Basic loan will be 4,000 taka).

Shohoz Shonchoy P9 Special Loans – for bigger loans

If you have a business with regular income, or if you earn a regular salary or wage, you can take a P9 Special loan as well as your regular P9 loan, and use it to build up your business or improve your household.

P9 Special loans start at 10,000 taka and rise up to 30,000 taka. They are disbursed with no deductions. They are not related to any savings you have at Shohoz Shonchoy. Only one P9 Special Loan can be held at a time by a household. For P9 Special loans you pay interest of 3% a month based on the outstanding loan balance, and you must repay the principal within 12 months. All interest payments and loan repayments are made in cash to our regular P9 staff.

Details of the P9 Special Loans:

Who can take a P9 Special Loan? You can take a P9 Special Loan if you run a business with a good regular income, or earn a regular salary or wage. If you think you qualify, please see our Manager at our office. You must have a P9 account and you must have taken and repaid the first two P9 loans (of 4,000 and 5,000 taka). You can also take a P9 Special loan if you previously took ‘P5’ or ‘P7’ loans of at least 5,000 taka and repaid them on time, with interest. Only one P9 Special Loan at a time is allowed per household.

How big are my P9 Special Loans? If you are a new customer, your first loan will be up to 10,000 taka. After that the loan size can grow by 5,000 taka each time up to 30,000 taka. If you already took P5 or P7 loans, and repaid them all on time, your first P9 Special loan can be up to 5,000 taka more than the biggest P5 or P7 loan you took and repaid.

How do I take a P9 Special Loan? You come to the office and take it in cash. No money is deducted for fees, and no money is deducted for savings. (If you want to put some of your loan into a savings account you may do so, of course).

How do I repay my P9 Special Loan? You pay your regular P9 staff. Each time she calls you repay as much or as little principle as you like, but your loan must be completely repaid within 12 months. Please make repayments in multiples of 50 taka (that is, 50, 100, 150, 200, 250 etc).

How much does my P9 Special Loan cost? P9 Special Loans cost 3% per month, on a declining-balance basis. There are no other fees or charges of any kind. No collateral of any kind is required. 3% per month is the same as 36% per year (36 taka per hundred taka per year).

When and how do I pay the interest on my P9 Special Loan? Your first interest payment is 3% of the loan amount and you must pay it on the day you take the loan. After that, you make your interest payments on the same day each month to our staff when she calls. Each monthly payment will be 3% of the balance on that day. See the example below. You must pay all the interest for the month in one single payment. You must pay the interest before you make repayments of principal.

Example: Mr Rahman took a P9 Special Loan of 10,000 taka on 22nd January. That day, he paid his first interest payment, of 300 taka (3% of 10,000 taka). During the next month (that is, up to 22nd February) he repaid 1,000 taka of principal. As a result, on 22nd February his outstanding balance was 9,000 taka, so that day he paid his second interest payment of 270 taka (3% of 9,000 taka). He continued in this way until he repaid all the principal.

What happens if I get into difficulty with my P9 Special Loan? If you have any problem repaying your loan or paying interest on your loan, come to our office and see our Manager. He will try to find some way to help you. If you fail to pay your interest on time, or if you fail to repay your loan in full within 12 months, then your next loan cannot rise in value. In very serious cases we may refuse you any more loans. Your loan is not related to any savings you have in Shohoz Shonchoy, but if we see that you are deliberately refusing to repay your loan we may need to keep your savings until the problem is solved.