In the model pioneered by the Grameen Bank loans are given to groups of five, with one member being the head of the group. The first loan goes to the first two members of the group, the second to the next two members, and the third loan goes to the group leader. If one member fails to repay then the whole group is denied a loan. This model thus makes use of private information, peer support, peer pressure and joint liability to overcome the challenge of asymmetric information that typically exists between borrowers and lenders.