Banking that makes a difference
 The man behind Bangladesh's Grameen Bank - Prof Muhammad Yunus - is bringing his method of upside-down banking to other Asian nations in the hope of alleviating poverty
Prof Muhammad Yunus, the 2006 Nobel Peace Prize laureate, renowned for championing micro-finance in poverty-stricken Bangladesh, was in Bangkok last week to launch the Yunus Centre at the Asian Institute of Technology (AIT).
The centre, modelled on two units opened earlier in Bangladesh, is the first of its kind outside his home country and is aimed at helping developing countries reduce poverty and promote sustainable development.
According to AIT, the Yunus Centre in Thailand will serve as a catalyst for radical changes on how poverty should be alleviated here and in other neighbouring countries such as Laos, Cambodia, the Philippines and Vietnam.
It will be run autonomously so as to meet the rural population's changing needs.
Yunus, who also won the 2009 US Presidential Medal of Freedom, said poor people are often hit the hardest by financial and economic crises so it's necessary to continue providing micro-credit and creating jobs at this juncture.
Yunus founded Grameen or Village Bank in Bangladesh in 1983 in his relentless pursuit to create economic and social development from the bottom.
Often called the "banker of the poor", he has turned the banking industry upside down by using a reverse business model.
"Conventional banks usually go for rich customers. The richer you are the more attractive you become. For Grameen Bank, it's the opposite - the poorer you are, the more attractive you are," says Yunus.
"We also try to support women [who are often the more economically deprived]. Of Grameen Bank's eight million borrowers, 97 per cent are women.
"Also, Grameen Bank requires no collateral or lawyers. It also has no business in urban areas and city centres, as the bank's staff members go to the customers' doorstep in the villages.
"The bank is also owned by its borrowers. It now has about US$100 million [Bt3.4 billion] in outstanding loans and takes deposits from customers as the source of funds for micro-credit," Yunus explained.
In the 1990s, Grameen Bank also introduced mobile phones in Bangladeshi villages. Yunus recalled that few people understood back then how such a move could make sense, given that most of the customers were very poor.
The bank then loaned money to poor women to buy those mobile phones so they could start their own micro-business - renting out the phones and airtime to villagers who needed communication devices.
Soon, it became a booming business with about 600,000 so-called mobile-phone ladies around the country.
Now, many Bangladeshi villagers have their own mobile phones, so Grameen Bank is heading toward a new business programme: promoting the Internet, so villagers can narrow the digital divide.
In his opinion, everybody has an entrepreneurial spirit - even beggars. His bank now has around 120,000 beggars on its books.
Experience has shown him that society often forces the underprivileged into begging because they have no other decent means of survival.
As a result, Grameen Bank provides US$12 (Bt400) to $15 as micro-credit for each beggar, with no interest or collateral. If the first loan is paid back, the borrower is eligible for more loans.
In Bangladesh, beggars often go from house to house, so now they are encouraged to carry some small goods with them, giving people a choice to either give away money or get something in return.
Thanks to this popular programme, some 16,000 of the 120,000 beggars have stopped begging altogether and started their own micro-business, while some only beg part time.
During the current global financial crisis, Yunus says his unconventional banking model is making many traditional bankers nervous.
"I can sleep well at night," he said, noting that several traditional bankers around the world probably could not because they were in trouble due to mountains of bad debt.
