Saturday, October 14, 2006
Micro-credit bank founder wins Nobel Peace PriZe
When the beggar woman asked Muhammad Yunus for money, he lent her $27. "Charity is not the answer to poverty," Yunnus wrote. "It only helps poverty to continue."
The woman and her friends used the money to start a furniture making business, escaped the bonds of poverty, and paid back the loan in full.
Cheers to my idol, economist with the biggest heart, Muhammad Yunus--founder of the Bangladesh Grameen Bank in 1983, inventing and implementing the concept of micro-finance and micro-loans that has lifted millions of the poor towards self-sufficiency, with no-collateral loans from $20 to $200.
Grameen Foundation's mission is to empower the world's poorest people to lift themselves out of poverty with dignity through access to financial services and to information. With tiny loans, financial services and technology, they help the poor, mostly women (97%), start self-sustaining businesses to escape poverty. Yunus' model has been successfully replicated around the world--including East Asia, South Asia, Africa, Middle East, even in United States. (Check out the Philippines' Grameen Bank locations).
Only the stong culture of sense and shame in Bangladesh women (in Philippines, we call that "kahiyaan") served as collateral and on that, Grameen Bank boasts of a 98.5% loan repayment. Much lower than a regular bank's rate repayment of 57%.
Yunnus and his Grameen Bank has shown that even the poorest of the poor can bring about their own development.
Click on Grameen Foundation and of course, my favorite site The New Heroes to find out more about Yunnus and his inovative Nobel Peace Prize project--now with 2,226 branches in 71,371 villages, 18,795 employees, with $5.7 billion in total loans disbursed. In 2005, Grameen boasted a $15.2 million profit--transferred to the Rehab fund to help with disaster situations.
Definitely, huge profits from that initial $27 investment!
And to Mr. Yunus, may you live long and have many heirs that will take care of our people for generations on end.