What is The Full Form of JLG in Banking
The JLG full form in Banking is Joint Liability Group. A Joint Liability organization (JLG) is an informal organization of four to ten people formed to get a bank loan, either individually or through the group method, in exchange for mutual guarantee. The group is mostly involved in comparable economic activities in the farm or non-farm sector and presents a joint undertaking to the bank, allowing them to obtain loans.
Objective of Joint Liability Group:
The main objective of the JLG is to augment credit flow to the farmers, especially the marginal, small and tenant farmers and those individuals who are taking up farm activities. Another objective of JLG is to extend the collateral free loans to the tenant farmers through the JLG mechanism.
Features of Joint Liability Group:
The JLG members would make a collective commitment to the bank, allowing them to get loans. JLG members are supposed to participate in similar economic activities such as crop cultivation and non-farm activity. The management of the JLG will be kept basic, with little or no financial administration within the organization. The Joint Liability Group allows members to obtain loans without the need for collateral, relying solely on their peer relationships, while also giving them the freedom to pursue their own aspirations.
