Note: Today is the launch of a new Web site and the Ingenuity Fund, an online fund raising and awareness campaign for the Grameen Foundation. While I've been preparing this blog and content for over a month, it was a week ago that I got an e-mail about the 27 on the 27th event. Yesterday I highlighted how Dr. Yunus put out $27.00 to pay off a moneylender in the village of Jobra, and in turn started led to the microcredit/microfinance revolution.
The 27 on the 27th event celebrates and honors that gesture by raising awareness and inviting people to get involved in this online initiative. Please visit the Grameen Foundation's Web site for more details. The Grammen Foundation is a sister organization to the Grameen Bank, which this post is about.
Yesterday I wrote about someone I consider a hero, Dr. Muhammd Yunus. I chronicled a segment of his life in the context of how a small thoughtful gesture can challenge the established way of doing things, with the result being a dynamic and sweeping change in the problems that people face on daily basis. The cause and effect of his actions are clearly tells a great story. I haven't read his autobiography yet, Banker to the Poor, but I have read Creating a World Without Poverty. It was in that book that I found the inspiration that I sought to see things in a different light. Telling his story on how the Grammen Bank was founded, and the subsequent programs and business that sprung out from it, the cause and effect of his actions are clearly illustrated, and warmly told.
When I read the story of how he uncovered the moneylender scheme in Jobra, and his action of paying off this person off, I was struck by the simple gesture and the implications that it had. I could understand how happy the folks who were freed from the clutches of the moneylender felt. I felt great, and all I did was read the story. Dr. Yunus explains how the excitement he saw in the folks in Jobra inspired him to do more.
The 27 on the 27th event celebrates and honors that gesture by raising awareness and inviting people to get involved in this online initiative. Please visit the Grameen Foundation's Web site for more details. The Grammen Foundation is a sister organization to the Grameen Bank, which this post is about.
Yesterday I wrote about someone I consider a hero, Dr. Muhammd Yunus. I chronicled a segment of his life in the context of how a small thoughtful gesture can challenge the established way of doing things, with the result being a dynamic and sweeping change in the problems that people face on daily basis. The cause and effect of his actions are clearly tells a great story. I haven't read his autobiography yet, Banker to the Poor, but I have read Creating a World Without Poverty. It was in that book that I found the inspiration that I sought to see things in a different light. Telling his story on how the Grammen Bank was founded, and the subsequent programs and business that sprung out from it, the cause and effect of his actions are clearly illustrated, and warmly told.
When I read the story of how he uncovered the moneylender scheme in Jobra, and his action of paying off this person off, I was struck by the simple gesture and the implications that it had. I could understand how happy the folks who were freed from the clutches of the moneylender felt. I felt great, and all I did was read the story. Dr. Yunus explains how the excitement he saw in the folks in Jobra inspired him to do more.
What I found intriguing was his pursuit of possibilities, and the willingness to experiment with the results that happened on the local level. Not everything was a success. Upfront and honest about the process he went through,and undaunted by the traditional role of banks lending money to people who already had money, not to the people who didn't, Dr, Yunus came up with a plan that the bank would lend him the money. He would be the guarantor of the loan, and he in turn would lend it to the people who were refused loans based on the standard metrics used to determine who can and can not get credit.
According to page 47 of Creating a World Without Poverty, Dr, Yunus was stunned by the results that the villagers he lent the money to. They paid on time and every time. Still this was not enough. Finally in 1977, one baker A.M Anisuzzaman, who was the managing director of the Bangeldesh Krishi (Agricultue) Bank agreed to open a special branch of the bank in Jobra that would lend to the poor.
Students of Dr. Yunus who were volunteering their time in assisting Dr, Yunus in his experiment would now have steady employment in their field, and the poor would have access to the funds they needed. The word Grammen, which means village, made its first appearance in the name Experimental Grameen Branch of the Agricultural Bank.
Despite it's continued success of having the loans repaid, the conventional though persisted. Money can only be lent to people who have money, not to those who don't. Something had to change, and it didn't seem like it was going to be the minds of the bankers. So, Dr. Yunus worked to change the law. By 1983 he was successful. A law was passed and Grameen Bank was founded.
As he did by becoming the gurantor of the original loan from the bank,and lending it to the poor himself, Dr. Yunus became the cause and effect of the change he saw was needed. It was from this small gesture of paying the moneylender off, that spawned a revolution in banking and finance.
The following from their Web site speaks for itself about Grameen Bank;
According to page 47 of Creating a World Without Poverty, Dr, Yunus was stunned by the results that the villagers he lent the money to. They paid on time and every time. Still this was not enough. Finally in 1977, one baker A.M Anisuzzaman, who was the managing director of the Bangeldesh Krishi (Agricultue) Bank agreed to open a special branch of the bank in Jobra that would lend to the poor.
Students of Dr. Yunus who were volunteering their time in assisting Dr, Yunus in his experiment would now have steady employment in their field, and the poor would have access to the funds they needed. The word Grammen, which means village, made its first appearance in the name Experimental Grameen Branch of the Agricultural Bank.
Despite it's continued success of having the loans repaid, the conventional though persisted. Money can only be lent to people who have money, not to those who don't. Something had to change, and it didn't seem like it was going to be the minds of the bankers. So, Dr. Yunus worked to change the law. By 1983 he was successful. A law was passed and Grameen Bank was founded.
As he did by becoming the gurantor of the original loan from the bank,and lending it to the poor himself, Dr. Yunus became the cause and effect of the change he saw was needed. It was from this small gesture of paying the moneylender off, that spawned a revolution in banking and finance.
The following from their Web site speaks for itself about Grameen Bank;
- Nobel Peace Prize, 2006
October 13, 2006 was the happiest day for Bangladesh. It was a great moment for the whole nation. Announcement came on that day that Grameen Bank and I received the Nobel Peace Prize, 2006. - Owned by the Poor
It is owned by the poor borrowers of the bank who are mostly women. It works exclusively for them. Borrowers of Grameen Bank at present own 95 per cent of the total equity of the bank. Remaining 5 per cent is owned by the government. - No Collateral, No Legal Instrument,No Group-Guarantee or Joint Liability
Grameen Bank does not require any collateral against its micro-loans. Since the bank does not wish to take any borrower to the court of law in case of non-repayment, it does not require the borrowers to sign any legal instrument. - 97 per cent Women
Total number of borrowers is 7.93 million, 97 per cent of them are women.
- Branches
Grameen Bank has 2,558 branches. It works in 84,573 villages. Total staff is 23,338. - Over Tk 465 billion Disbursed
Total amount of loan disbursed by Grameen Bank, since inception, is Tk 465.29 billion (US $ 8.26 billion). Out of this, Tk 414.27 billion (US $ 7.34 billion) has been repaid. Current amount of outstanding loans stands at TK 51.02 billion
(US $ 738.84 million). - Recovery Rate 98 per cent
Loan recovery rate is 97.89 per cent. - 100 per cent Loans Financed From Bank’s Deposits
Grameen Bank finances 100 per cent of its outstanding loan from its deposits. - No Donor Money, No Loans
In 1995, GB decided not to receive any more donor funds. Since then, it has not requested any fresh funds from donors. Last installment of donor fund, which was in the pipeline, was received in 1998.
- Earns Profit
Ever since Grameen Bank came into being, it has made profit every year except in 1983, 1991, and 1992. It has published its audited balance-sheet every year, audited by two internationally reputed audit firms of the country. All these reports are available on CD, and some on our web-site.
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