Banker to the Poor

2009 May 28

In my continuing efforts to read more non-fiction, I recently finished the unabridged audiobook of “Banker to the Poor,” by Mohammad Yunus.

Mohammad Yunus is the founder of the Grameen Bank, which began in Bangladesh back in the 1970s. It is now a massive, self-sustained banking institution, serving millions of poor people in Bangladesh and has served as the model for hundreds of other similar programs in other countries. Recently, Grameen Bank opened Grameen USA, in Queens in New York City.

In a nutshell, Yunus describes the evolution of Grameen Bank, and the principles behind his belief that access to credit is a basic human right which no one should be denied. Grameen Bank offers micro-loans (very small, but life changing amounts of money) to the poorest of the poor, requiring no collateral or legal agreements regarding repayment. Since the 90s, Grameen Bank has been self supporting, needing no outside donations to continue to survive and grow. Their repayment rate is greater than 95 percent.

The stories of the impoverished people and the way these tiny loans changed their lives from bleakness to hope are inspiring. Some 97-98 percent of Grameen Bank borrowers are women, married, widowed, single, whatever. They found in the early years that by focusing on women, they were better able to improve conditions of the family as a whole. Men tended, once they had more money, to spend it on themselves. Women, on the other hand, spent new income on the whole family. Also, women are the most helpless, discriminated-against, destitute members of this largely Muslim country.

He had a story of one woman, Amina, whose husband had become ill. Trying to pay for his medical care had left the family destitute. Four of her six children had died of hunger or disease. After her husband died, all that remained to her was her house. She was considered old at 40, in a country where men outlive women. She was illiterate and had never had a job. Her inlaws tried to kick her out of her house after her husband’s death, but she wouldn’t leave.

One day she came home and found that her brother-in-law had sold her tin roof. She had no money to buy a new roof, so when the rainy season started, she and her daughters had no shelter from the rain, and the downpours began to destroy the mud walls. They were cold, wet and always hungry.

Amina turned to begging in nearby towns and one day, when she returned home, she saw that her home had collapsed. She found her eldest daughter buried under the rubble, dead.

When Grameen Bank came to her village, Amina was in total despair. With Grameen’s help, she borrowed enough money to buy bamboo so she could weave baskets to sell, earning a living so she could feed and house herself and her lone surviving daughter. She remained a Grameen borrower the rest of her life, and her daughter is one today.

This was just one story. I found these stories of the women’s struggles, successes and failures to be the most compelling parts of the book, and wished for more.

The author, Mohammad Yunus, is an amazing man who works tirelessly for the benefit of the poor. In 2006, he and the Grameen Bank were jointly awarded the Nobel Peace Prize. Well-deserved, I say.

The bank has its critics, but in general, the criticisms can be dismissed. The most persuasive aspect of micro-credit, to me, is that it empowers those with the will to change their lives, and very often revives a will that hopelessness had seemingly destroyed. In addition, with Grameen’s insistence on all the children of Grameen borrowers going to school, they lay the foundation for increasing dividends as the years pass.

We have some micro-credit programs in the U.S.A., and President Obama recently created a $100 million microfinance growth fund for small lenders in the Western Hemisphere. Critics say these programs can’t work in “rich” nations, but it’s good to see that some people are trying it nonetheless.

I haven’t done “Banker to the Poor” even partial justice here, so if you get the chance, check it out. It can change the way you think about the poorest of the poor.

Grameen Bank web site — http://www.grameen-info.org/

6 Responses
  1. 2009 May 28

    A must read indeed. I’m so glad you shared this review of the book along with your thoughts and feelings about it. Nice, nice, nice.
    These stories (your review and other similar stories) are proof that money can be an ‘inside job’. Instead of being some kind of false and visable proof of power, intelligence and importance, it can reach inside and bring out the real power, intelligence and importance that truly exists within each one of us.
    Nice, nice, nice.

  2. 2009 May 28

    That is really wonderful. I love the micro-loan programs. Going to get my hands on that book; I owe you after you read T Harmann’s book.

  3. 2009 May 28
    Belledog permalink

    Great post, Stace.

    Recommend kiva.org — US microfinance operation. You donate $$ via credit card payment and allot it among the borrowers — small business owners in developing countries and sometimes Europe. Kiva keeps you posted on repayment by borrowers; when funds are replaced, you select another set of borrowers and relend.

    Money never comes back to you — per my understanding — but what a great gift that keeps giving.

    Kiva, based in San Francisco, partners with microlenders in the developing world.

    http://www.kiva.org

    =============

    I do wish we had a similar operation to help small entrepreneurs in the Great Plains states, abandoned textile towns, Michigan and anywhere else with a struggling economy.

    Maybe we do. Anyone know of one?

  4. 2009 May 28
    lady canada. permalink

    You can pull your money out of Kiva, after the loan cycle is complete. Usually people don’t though because it’s so fun and so addicting!

  5. 2009 May 29

    WOW, that sounds stunning. I must read more on this one! What a wonderful post, I had never heard of this! :)

    Good to hear something nice for a change. (I mean in general, not referring to your blog…lol)

  6. 2009 May 29

    For a while, in the BlogHer ads that run on this site, there were ads for Kiva. Hedon said she checked it out and thought it looked like an awesome program. Like Lady Canada said, Hedon says she thinks you can pull the money out if you want.

    If any of y’all do read the book, you’ll see what I mean when I say I didn’t do justice to Yunus or the book. Grameen Bank is huge now, having launched numerous other businesses for the benefit of the poor, including things like cell phone and internet access. The web site lists all the different businesses spawned from the original Grameen Bank.

    And Decorina … LOL. Nah, you don’t owe me — I owe you. The Hartmann book was great.

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