Several MFIs Take Advantage of an Innovative Lending Technology Known

question 9

Multiple Choice

Several MFIs take advantage of an innovative lending technology known as group liability lending.What is the advantage of group liability lending

• A) Its shifts the burden of screening and supervising from group members to loan officers
• B) It reduces the risk involved in borrowing from an MFI
• C) It lowers lending costs by shifting some the burden of screening and supervising from loan officers to group members
• D) It provides borrowers with dynamic incentives for repayment

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Definitions:

Cash Cycle

The cash cycle measures the time it takes for a company to convert its inventory and other resources into cash flows from sales, indicating the efficiency of a company's cash management.

First Quarter

Typically refers to the first three months of a financial year, used as a reporting period by businesses and other organizations.

Operating Cycle

The duration between a company's purchase of inventory and the receipt of cash from accounts receivable, reflecting the efficiency of a company's cash flow.

Inventory

refers to the goods and materials a business holds for the ultimate goal of resale or production.