Chama Loan Application Form Template (With Guarantor Section)

Most chama loan disputes start with a loan that was agreed by word of mouth: nobody wrote down the amount, the interest, the repayment dates or who guaranteed it. A simple, signed chama loan application form fixes that before the money leaves the group.

Below is a free template with a borrower section, a guarantor section and an officials' approval section. Copy it and adapt it to your group's loan rules.

Download: chama loan application form (Word, .docx)

What a chama loan form must capture

• Who is borrowing and whether they qualify under your rules (for example, no arrears).
• How much, for what, and for how long.
• The interest rate and how it is calculated, flat or reducing balance.
• Who guarantees it, for how much, and that each guarantor agrees in writing.
• The repayment schedule and what happens on default.
• Approval by the officials named in your rules.

The form only works if your group has agreed its loan rules first. See our chama loan rules guide.

Chama loan application form template

Part A: Borrower's details

Group name: [Group Name] Self-Help Group
Full name: ______________________
Member number: ________ ID number: ________
Phone number: ______________________
Date of application: ______________________

Part B: Loan requested

Amount requested (KES): ______________________
Amount in words: ______________________
Purpose of the loan: ______________________
Repayment period (months): ________
Interest rate: ____% per [month / year], calculated on a [reducing balance / flat] basis
Processing fee (if any): KES ________

Part C: Borrower's savings and existing loans

Current savings or share balance (KES): ________
Outstanding loans with the group (KES): ________
Contribution or fine arrears (KES): ________
Maximum loan allowed under the group's rules (KES): ________

Part D: Borrower's declaration

I confirm that the information above is true. I agree to repay this loan with interest according to the repayment schedule and the group's loan rules. I understand that if I default, the group may recover the amount owed from my savings, and then from my guarantors' savings, and may charge fines as set out in the by-laws.

Borrower's signature: ______________ Date: ______________

Part E: Guarantors

Each guarantor agrees that, if the borrower defaults, the amount they guarantee may be recovered from their savings or shares, and that this amount stays committed until the loan is fully repaid.

1. Name: ______________ Member no: ______ Amount guaranteed (KES): ______ Signature: ______________
2. Name: ______________ Member no: ______ Amount guaranteed (KES): ______ Signature: ______________
3. Name: ______________ Member no: ______ Amount guaranteed (KES): ______ Signature: ______________

Part F: For official use

Savings and arrears checked by the Treasurer: [Yes / No]
Decision: [Approved / Approved for KES ________ / Rejected]
Reason (if rejected or reduced): ______________________
Approved amount (KES): ________ First repayment date: ________
Monthly instalment (KES): ________ Final repayment date: ________

Chairperson: ______________ Signature: ______________ Date: ________
Treasurer: ______________ Signature: ______________ Date: ________

Part G: Disbursement

Amount disbursed (KES): ________ Date: ________
Method: [M-Pesa / bank transfer / cash] Reference: ______________
Received by borrower: ______________ Signature: ______________

How to use the form

1. Check eligibility first. The Treasurer confirms savings, existing loans and arrears in Part C before officials consider the request.
2. Collect guarantor signatures before approval, not after.
3. Approve at a meeting or as your rules require, and record the decision in the minutes. See our minutes template.
4. Give the borrower a repayment schedule with every instalment date and amount.
5. Disburse by M-Pesa or bank transfer so there is a record, and note the reference in Part G.
6. Release guarantors in writing once the loan is fully repaid.
7. Keep the signed form with the secretary until the loan is closed.

Common mistakes

• Not stating flat or reducing balance. The same rate can mean very different amounts.
• Guarantors who did not sign. A guarantor named without a signature is very hard to enforce.
• Officials approving their own loans. A borrower who is an official should step out of the decision.
• No repayment schedule. Without dates, "late" means nothing and fines cannot be applied fairly.

Frequently asked questions

Do chama loans need a written agreement?

They should. A signed form with the amount, interest, repayment schedule and guarantors is the best protection for both the borrower and the group, and it is the first thing members will ask for in a dispute.

How many guarantors should a chama loan have?

Your loan rules decide. A common approach is to require guarantors for any amount above the borrower's own savings, often with a minimum of two.

Can guarantors withdraw their guarantee?

Usually not while the loan is outstanding, unless another member replaces them and the officials agree. Write this into your loan rules.

Skip the paperwork with ChamaPoint

In ChamaPoint, our chama management system, members apply for loans from the app or web portal. The application records the amount, purpose, repayment period, interest rate and the member's loan limit at the time, officials approve or reject it with a reason, and guarantors pledge from their savings or shares, released when the loan is repaid. Repayment schedules are generated automatically and members repay by M-Pesa. Get the ChamaPoint Android app or start a 7-day free trial. No card is required.