Saturday 19 April 2014

The Investment in Women – How Yunus’s Grameen Bank Contributed to Eradication of Poverty by Empowering Poor Women.



“The process of breaking down fear was always my greatest challenge and it was made easier by the careful work and gentle voices of my female workers.”― Muhammad Yunus, Banker to the Poor: Micro-Lending and the Battle Against World Poverty
The epidemic of poverty is wreaking havoc across women in different parts of the world. Data are showing a stark discrimination between women and men in terms of earnings and financial autonomy: more women than men work in vulnerable employment with low or no cash returns, and they spend more of their time on unpaid domestic tasks. Proportions of married women aging from 15 to 49 who were employed and earning cash income were significantly of much lower proportions than their married male counterparts. Gender inequality is also skewed in favor of men when talking about the rights of land ownerships and inheritance of properties. 
Mohamed Yunus, the Bangladeshi economist, proposed a revolutionary approach to empower the poor called “microfinance” or “microcredit” offered through the first bank for poor, Grameen Bank. Instead of borrowing money from loan sharks with unjust interests, Yunus offered the poor people, mainly women, small increments of money with much improved payment conditions. The microcredits contributed significantly in helping the poor people to overcome their debts and raise their quality of life. Repayment rates were very high thanks to the “solidarity groups”, where loans were given to people in groups to be self-encouraged to pay their debts collectively to Yunus so as to receive further support. Yunus described the first impressions from his peers upon the commencement of his project “I went to the bank and proposed that they lend money to the poor people. The bankers almost fell over”
Katherine Esty in her book “Twenty-Seven Dollars and a Dream How Muhammad Yunus Changed the World and What It Cost Him” has identified the causes that made women a very profitable choice for Yusuf to rely on: women always make better use of small loans than men as they focus their spending in ways that help to support their families over time not on luxury. Women abided by repayment schedules in a better way than men and thus were candidates to more flexible repayment facilitations when they faced financial hardships. Women also represented an untapped treasure of labor force that could be exploited for achieving sustainable profits. The financial empowerment of poor women was Yunus’s tenet in his economical revolution in Bangladesh. He believed that it is unfair that only rich men can borrow money from conventional banks while letting the population of poor to perish without their basic needs. Women who achieved savings adopted better lifestyles and this may be attributed to their compliance with the “Sixteen Decisions”. These decisions embraced by Yunus and Grameen Bank prompted the people to send their children in schools, keep a smaller family size, behave honestly with each other and maintain a clean environment. As a result, almost all Grameen borrowers have their school-age children enrolled in regular classes, “When a destitute mother starts earning an income, her dreams of success invariably center around her children. A woman's second priority is the household. She wants to buy utensils, build a stronger roof, or find a bed for herself and her family. A man has an entirely different set of priorities. When a destitute father earns extra income, he focuses more attention on himself. Thus money entering a household through a woman brings more benefits to the family as a whole.” said Yunus.
Grameen Bank has achieved outstanding figures, since The Grameen Bank Project was transformed into a formal bank in 1983; US$11.35 billion has been distributed to poor individuals without the need for them to provide collateral. The Bank now has approximately 8.35 million borrowers, 96% of which are women. The Bank claims that approximately 65% of their borrowers have clearly improved their socio-economic conditions and lifted themselves out of poverty. Yunus and Grameen Bank were awarded Nobel Peace Prize in 2006 for their work in fighting poverty and empowering women in Bangladesh and many followed in their footsteps in different parts of the world. The philosophy that Yunus adopted was replicated by others and showed promising results, “To me, the poor are like Bonsai trees. When you plant the best seed of the tallest tree in a six-inch deep flower pot, you get a perfect replica of the tallest tree, but it is only inches tall. There is nothing wrong with the seed you planted; only the soil-base you provided was inadequate. Poor people are bonsai people. There is nothing wrong with their seeds. Only society never gave them a base to grow on.” said Yunus.
The Bangladeshi Government is trying to seize control over Grameen Bank, thus threatening the sustainability of the project that serves millions of poor women and their families. Yunus was forcefully ousted from his position as a manager for Grameen Bank, and that move was condemned by different bodies all over the world, “I feel extremely sorry that the nation has to go through the unnecessary traumatic experience of seeing a great global iconic institution, created by this nation, be brutally harmed by a group of irresponsible and thoughtless people,” said Yunus.
It is our mission to support what Yunus strived for in the past three decades. The Bank for Poor must continue serving the poor women and developing their lives. The public opinion will be the shield that protects Grameen Bank from the corruption of the Bangladeshi Government. All of us are yearning for the day when global poverty is totally demolished and for the sake of that dream, Grameen Bank will have to flourish!
By Ahmed Magdi Youssef                                                                     
References:
- The World’s Women 2010 – Trends and Statistics. Department of Academic and Social Affairs, United Nations, 2010
- Muhammad Yunus: Ending Global Poverty. MIT World, Semptember 14, 2005.
-  5 Reasons Why Muhammad Yunus Focuses on Lending to Women. Katherine Esty, Bill& Melinda Gates Foundation, January 10, 2014.
- Why Muhammad Yunus and the Women of Grameen Matter. Vivian Norris, Huffington Post Business, March 9, 2011.
- Yunus flays Bangladesh's 'destruction' of Grameen Bank. Agence France-Presse, Global Post, November 6, 2013.

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