Published by: The AsiaN
Published Date: 24 November, 2016
Prof. Muhammad Yunus is an extraordinary person who created a totally different perspective for social inequality. He is an intellectual, benevolent, banker, social entrepreneur, economist, and civil society leader as well as being an inventor of vital economic terms for poor people. His great initiative, the Grameen Bank helped poor people and gave a chance to them to be investors. In 2006, the bank and its founder, Muhammad Yunus, were jointly awarded with the Nobel Peace Prize because of his efforts for the social development.
Mehmet Fatih Oztarsu, The MagazineN reporter, made an interview with him for our valuable readers.
1. Mr. Yunus, you have been inspired by the Bangladesh famine of 1974 and you followed a creative way for your rural economic program. Can you tell us about that process?
I was shocked by the famine of 1974. I was teaching as an economics professor at Chittagong University in Bangladesh in the year 1974. I felt what teach in the classroom is all fairy tales, it has no relevance to the reality of the people who were dying of hunger. I felt that I am a useless person having no usefulness to other people. I wanted to make myself useful in some ways to the people in the village next door. That’s when I started visiting the village almost every day to see if can make myself useful to at least one person each day. In the process, I got to know the people in the village. I keep seeing the horrible system of loan sharking which takes away everything poor borrowers got by exploitative conditionality. In order to protect the poor, I started lending money myself. People loved it. I was happy because I could see my work was being appreciated by the poor people. This was the beginning of my lending money to the poor people. Since much more wanted to borrow money from me I transformed it into a bank in 1983. We called it Grameen Bank, or village bank.
Grameen Bank offers collateral-free loans to poor people, particularly poor women. The bank now has 9 million borrowers, 97 per cent of them are women. It is financially self-reliant; it does not depend on any external funding.
2. The Grameen Bank is a prime example of the social business with poor people being its shareholders. What are the main mission and functions of the Grameen Bank?
Yes, Grameen Bank is a prime example of social business. It fulfills the conditions of the definition of a special type of social business by being a problem-solving business and owned by poor people. The core mission of the bank is to provide financial services at the doorstep of poor women in an affordable way to turn themselves into entrepreneurs, and take charge of their own destiny.
3. The terms of “microcredit” and “Grameen credit” sound magical. Can you give us details about them?
Essential features of microcredit are: it does not require any kind of collateral, it is for assisting the borrowers to turn themselves into entrepreneurs by investing the loan money, it does not include consumption loans, it requires weekly savings in savings account as an integral part of it, focused on poor women, all poor are eligible, loan is to be paid back in small weekly installments, nobody is excluded from the program, not even the beggars. It works in urban areas, rural areas, in rich countries and poor countries, it works wherever the poor live. It is sustainable.