Business Daily from THE HINDU group of publications
Wednesday, Jan 31, 2007
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Business Daily from THE HINDU group of publications Wednesday, Jan 31, 2007 ePaper |
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Industry & Economy
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Rural Development Money & Banking - Regional Rural Banks Microcredit — Legal framework, need of the hour: Yunus Our Bureau
Looking ahead Today Bangladesh's Grameen Bank has 2,300 branches and lends out to 16 million citizens. In India, the movement is still nascent with around 34 million beneficiaries. To grow it here, Prof Yunus advocated a legal framework and regulatory body.
After receiving the highest recognition and reaching the magic figure of a 100 million micro credit finance families, Prof Yunus could afford to be in a mellow mood as he related to industry and business school students of the International Management Institute the early days of the Grameen Bank and his doggedness to make it work. "The poor proved themselves to be bankable... what started in one village is touching chords around the world," he said, describing how the famine in Bangladesh forced this university teacher out of the classroom on to the field. In Jobra village, Prof Yunus discovered moneylenders playing havoc with the lives of the poor. He found 42 people together indebted to the Shylocks for a mere $27. Paying up the sum, the laureate wanted to do more. With commercial banks sceptical of lending to the poor, he started a bank that's owned by the borrowers themselves - the Grameen Bank. Today Bangladesh's Grameen Bank has 2,300 branches and lends out to 16 million citizens. In India, the movement is still nascent with around 34 million beneficiaries. To grow it here, Prof Yunus advocated a legal framework and regulatory body. "The Indian Government should draft a law which would make micro credit mainstream. A legal framework is important to mobilise deposits. Right now it is non-government organisations that are doing the lending activity," he said. He also mooted a `social stock market' to list companies that are engaged in businesses in the social sector. "Corporate houses should take up social business initiatives that aim at serving the poor through a non-loss, non-dividend business," he said, emphasising that the model should not be misunderstood as philanthropy. Prof Yunus is most pleased that the Grameen Bank has 50 per cent of its beneficiaries as women. "When we started out, women refused to accept the money saying they did not know how to handle it. But I told my students, `It is her history saying no, not her saying no'. And I have been proved correct," he said, while also detailing the work the bank has done with beggars. Almost 85,000 beggars in Bangladesh now earn a living. "We asked them to sell wares even as they were begging, and it worked. Poor people are very capable of taking charge of their lives. They do not ask for special favours, they need opportunity," he said.
More Stories on : Rural Development | Regional Rural Banks | Courts/Legal Issues
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