Finance : Banker To The Poor: Micro-Lending and the Battle Against World Poverty

Banker To The Poor: Micro-Lending and the Battle Against World Poverty

CDN$ 3.60


It began with a simple $27 loan. After witnessing the cycle of poverty that kept many poor women enslaved to high-interest loan sharks in Bangladesh, Dr. Muhammad Yunus lent money to 42 women so they could purchase bamboo to make and sell stools. In a short time, the women were able to repay the loans while continuing to support themselves and their families. With that initial eye-opening success, the seeds of the Grameen Bank, and the concept of microcredit, were planted. After earning a Ph.D. in economics at Vanderbilt University, Dr. Yunus returned to Bangladesh to settle into a life as a professor. But a famine in 1974 ravaged the country, leading Dr. Yunus to alter his thinking and his life profoundly: What good were all my complex theories when people were dying of starvation on the sidewalks and porches across from my lecture hall?.... Nothing in the economic theories I taught reflected the life around me. Armed with little more than a lofty dream to end the suffering around him, he started an experimental microcredit enterprise in 1977, by 1983 the Grameen Bank was officially formed. The idea behind the Grameen Bank is ingeniously simple: extend credit to poor people and they will help themselves. This concept strikes at the root of poverty by specifically targeting the poorest of the poor, providing small loans (usually less than $300) to those unable to obtain credit from traditional banks. At Grameen, loans are administered to groups of five people, with only two receiving their money up front. As soon as these two make a few regular payments, loans are gradually extended to the rest of the group. In this way, the program builds a sense of community as well as individual self-reliance. Most of the Grameen Bank s loans are to women, and since its inception, there has been an astonishing loan repayment rate of over 98 percent. Banker to the Poor is an inspiring memoir of the birth of microcredit, written in a conversational tone that makes it both moving and enjoyable to read. The Grameen Bank is now a $2.5 billion banking enterprise in Bangladesh, while the microcredit model has spread to over 50 countries worldwide, from the U.S. to Papua New Guinea, Norway to Nepal. Ever optimistic, Yunus travels the globe spreading the belief that poverty can be eliminated: ...the poor, once economically empowered, are the most determined fighters in the battle to solve the population problem, end illiteracy, and live healthier, better lives. When policy makers finally realize that the poor are their partners, rather than bystanders or enemies, we will progress much faster that we do today. Dr. Yunus s efforts prove that hope is a global currency. --Shawn Carkonen

One of the best books I read - Mohammad Yunus story is truly inspiring. Makes you question the rules of capitalism.Writing style makes it very interesting to read. I am glad I read ths book.

The pioneer of microlending... - The story of the Grameen bank is an excellent example of how social change initiatives can be combined with government and private industry support to acheive a greater outcome than the organization could acheive by itself. Yunus provides an excellent chronicle of his bank s formation as well as explaining its principles. Highly recommended for anyone interested in social entrepreneurship or social change. The only shortcomings are: 1) as a finance person, I would like to have read more about the operational side of the banks relative to their commercial competitors - what specific factors enabled them to be so successful (other than the broad social factors he identifies)? 2) Need more information about how these types of programs can be applied to industrialized nations such as the US.

Small loan impacts on the lives of third world peoples - In 1983 Yunus established a bank devoted to providing the poorest of Bangladesh with small loans, aiming to help the poor by supporting them with his own enterprise. Yunus small loans paid off big time, and this provides a review of his theories of small loan impacts on the lives of third world peoples. An intriguing, important guide packed with ramifications for all.

Practical help - I can only agree with the other reviews of this book, but I would like to add that anyone who appreciates what Yunus has done might also read The Mystery of Capitalism by Hernando de Soto. Both de Soto and Yunus underline the importance of using market-based mechanisms to alleviate poverty at the grass-roots level (de Soto suggests giving squatters and illegal workers legal title to the land they occupy and the goods they have so they can use them as collateral to raise capital and receive infrastructure). P.J. O Rourke makes the same point in several places, but he is writing from a quasi-comedic point of view.If the past 25 years of history has been about anything, it is about the bankruptcy of the command economy. Warts and all, market-based solutions are the only way forward. The ideas of Yunus and de Soto are, above all, practical - which is probably why policymakers will overlook them in favour of big-money projects, grand pronouncements, and other things that don t work.

Not bad - This story of the beginings of the Graemen bank isn t bad. it gives a very good picture of the purpose of microcredit and it s applications in the third world.




Banker To The Poor: Micro-Lending and the Battle Against World Poverty