Kohalpur Home Upgrading
- Status: Construction
- People Housed: 1,105
- Country: Nepal
- City: Kohalpur
- Partner: Sewa
- Year Approved: 2016
This project provides home loans of NPR 400,000 to people living on low incomes around the centre of Kohalpur. The project is targeted at families with land already in place and offers financial as well as technical assistance for people to build their own low-cost homes equipped with water, sanitation and energy. The design of houses is community led, as is the planning process.
Sewa has successfully worked with a local bank to finance this project through a bank guarantee initiative. As low-income individuals are often perceived as a financial risk, by Sewa providing a guarantee to the bank, confidence is therefore placed in the individual to repay the loan. This demonstrates a positive example to other banks of the ability of individuals on low incomes to successfully repay loans. Significant achievements have already been seen in this; previous Reall-funded projects of this type have tended to require a guarantee of 50% from the partner, but Sewa were able to negotiate a 20% guarantee. Following successes with the initial phase of loans, Sewa negotiated with the bank for the money to be revolved for a second time, resulting in expected units doubling to 540.
Client Data
Clients estimated to sit between 51st and 60th percentiles of incomes in Kohalpur
| Description | Type | Number Expected | Number Completed | Unit Size (m2) | Monthly Cost (Local Currency) | Loan Length (months) |
|---|---|---|---|---|---|---|
| Loan guarantee projects where Sewa provide a 20% guarantee to bank to provide a NPR 400,000 loan for construction. The rest of the cost is covered by the individual. | Self Build | 275 | 208 | 34 | 6744 | 84 |
| Loan guarantee projects where Sewa provide a 20% guarantee to bank to provide a NPR 400,000 loan for construction. The rest of the cost is covered by the individual. | Loan | 25 | 39 | - | 6744 | 84 |
| Finance Description | Finance Source | Interest Rate (%) |
|---|---|---|
| Loan guarantee projects where Sewa provide a 20% guarantee to bank to provide a NPR 400,000 loan for construction. The rest of the cost is covered by the individual. | Laxmi Bank | 11.0 |
| Loan guarantee projects where Sewa provide a 20% guarantee to bank to provide a NPR 400,000 loan for construction. The rest of the cost is covered by the individual. | Laxmi Bank | 11.0 |
Project Finances
Investments — Reall to Affordable Housing Partners
Based on exchange rate on 31/10/2021
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Data last updated on 30/06/2022