Yunus is a 65-year-old economist who pioneered the use of “microcredit.”:http://en.wikipedia.org/wiki/Microcredit Through his Grameen Bank, poor Bangladeshis are able to receive very small loans, which they then pay back on an honor system. The effort has been extremely successful.
Earth & Sky covered a part of this story earlier this year, in our radio report about “100,000 phone ladies in Bangladesh.”:http://earthsky.org/radioshows/49524/in-bangladesh-100000-rural-poor-are-phone-ladies Cell phones are a huge boost from poverty, since they enable rural farmers or craftpeople, for example, get access to information about the best markets for their goods.
Earth & Sky first heard about Grameen Bank – which, by the way, means “Village Bank” – when “we talked with Stuart Hart”:http://earthsky.org/category/humanworld/interviews.php?id=49518 last spring. Hart is a Cornell professor who is an expert on business in both the developed and developing worlds. Hart told Earth & Sky, “The Grameen Bank is a very substantial entitity. They’re loaning three-quarters of a billion dollars or so in over half of the rural villages in Bangladesh.
He added, “The Grameen Bank has spun off a number of enterprises. Probably the one that’s farthest along and most successful is Grameen Phone. They’ve essentially started a village phone company in Bangladesh.
“Until recently,” Hart said, “there was no phone service. A land line would be many, many miles away for a rural villager. So they entered the business of providing rural cell phone service. And most people initially thought that they were crazy, that only rich, city people in developed countries could afford a cell phone. The idea of rural cell phone service just seemed absurd.
“But that was never their model. Their model was never just to sell a cell phone to poor people. On the contrary, because they already had extensive knowledge of rural women who had borrowed from Grameen Bank, they had a good stock of women entrepreneurs. So, in essence, they have empowered close to 100,000 rural women to become “phone ladies.”:http://earthsky.org/radioshows/49524/in-bangladesh-100000-rural-poor-are-phone-ladies They essentially lend them the money to buy a cell phone and a solar recharger. With some training – in entrepreneurship, numeracy, that sort of thing – the women become entrepreneurs and sell the phone service in their immediate village or surrounding villages.
“And this business has just utterly boomed,” Hart said. “There was so much pent up demand, because if you think about it, it’s a question of information poverty. Poor people in remote or isolated areas have a very difficult time getting access to good information. So a farmer, for example, might spend four or five days traveling into the city to try and find out what he’d be able to sell his crops for, riding on mules and buses, and then still not get the right information. Now, the farmer can make two or three calls, and in the space of a half an hour, has much better information, can make a more informed choice, and in many cases those farmers can double their income, just with access to better information.”
In part for this effort in bringing phone service to the poor, Grameen Bank founder Muhammad Yunus has now won a Nobel Peace Prize. Yunus, who is sometimes called “the world’s banker to the poor,” said he would use part of his share of the $1.4 million award money to create a company to make low-cost, high-nutrition food for the poor. The rest would go toward setting up an eye hospital for the poor in Bangladesh, he said.
“Grameen Bank home page”:http://www.grameen-info.org/
“Profile of Muhammad Yunus”:http://news.bbc.co.uk/2/hi/south_asia/6047234.stm from the BBC.
