<|im_start|>user
What is a group loan?<|im_end|>
<|im_start|>assistant
A lending mechanism which allows a group of individuals - often called a solidarity group to provide collateral or loan guarantee through a group repayment pledge. The incentive to repay the loan is based on peer pressure, if one group member defaults, the other group members make up the payment amount.<|im_end|>
