Who is this guy?

Nobel Peace Prize 2006: Microfinance Dr. Muhammad Yunus Lecture by Wendy M. Jeffus

Dr. Muhammad Yunus Won the Nobel Peace Prize in 2006 – Established the Grameen Bank in Bangladesh in 1976 (with $27). Microfinance – also called "banking for the poor" means providing poor families with very small loans (i.e. to buy cows, chickens or a cell phone) to help them start and grow businesses. – The loans are typically less than 200 US dollars. – No collateral is needed and repayment is based on an honor system. – Anyone can qualify for a loan - the average is about $200 - but recipients are put in groups of 5. Once 2 members of the group have borrowed money, the other 3 must wait for the funds to be repaid before they get a loan. – This helps people emerge from poverty and encourages sustainable peace. Thirty years later, the bank has 6.6 million borrowers, of which 97% are women

The “Eureka Moment” Dr. Yunus was chatting to a shy woman weaving bamboo stools in – Sufia Begum was a 21-year-old mother of 3. Dr. Yunus asked her how much she earned. – She replied that she had borrowed about five taka (nine cents) from a middleman for the bamboo for each stool. – She earned only 2 cents on each stool. Dr. Yunus said “I thought to myself, my God, for five takas she has become a slave…. I couldn’t understand how she could be so poor when she was making such beautiful things.”

856 taka (about 27 dollars) The following day, Dr. Yunus and his students did a survey in the woman’s village, Jobra, and discovered that 43 of the villagers owed a total of 856 taka (about $27). Dr. Yunus said “I couldn’t take it anymore. I put the $27 out there and told them they could liberate themselves, and pay [me] back whenever they could.” – The idea was to buy their own materials and cut out the middleman. – They all paid him back, day by day, over a year, and his spur-of-the-moment generosity grew into a full-fledged business concept that came to fruition with the founding of Grameen Bank in

Microcredit Worldwide, microcredit financing is estimated to have helped 92 million families last year alone. – Today, the bank is a model of micro-financing has inspired similar efforts around the world. – The success has allowed Grameen Bank to expand its credit to include housing loans, financing for irrigation and fisheries as well as traditional savings accounts. Ole Danbolt Mjoes, chairman of the Nobel committee that awarded the prize, said “We are saying microcredit is an important contribution that cannot fix everything, but is a big help.”

Grameen Bank May 2007: 7.16M Borrowers. – 97 percent are women. 2,422 Branches – Provide services to 78,101 villages (more than 93% of the total villages in Bangladesh).

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