The microcredit movement was initiated in the early 1980s by the Grameen Bank, one of Bangladesh's best known providers of micro credit. While the key operational and financial features of the credit programs are similar, the scope of lending and non-lending services offered by each microfinance institution varies. At the other end are institutions where credit activities dominate and technical assistance, if any, is limited. Borrowers are part of a 15-20 person group which meets regularly. Loans are collateral-free, and usually have a maturity of 50 weeks with weekly repayments.
Savings is an integral part of the program.
Financial transactions are recorded in individual passbooks in the presence of the entire group to enhance transparency and self-monitoring. Borrowers have full freedom to choose the activity to be financed by the loan, which are mostly rural non-farm activities with short gestation and daily sales such as poultry farming, petty trade and shopkeeping, cattle raising, or handicrafts. The government will onlend IDA funds to PKSF at 1 percent for 20 years, with five years' grace.