Bangladesh Grameen Bank – Pioneer in Microfinance
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A SUCCESSFUL MODELWhen Grameen Bank started,
many felt that it would soon fail; but on the contrary the bank expanded its
operations very rapidly. From 15,000 borrowers in 1980, the membership
increased to 100,000 in 1984; by 1991 it had 910,842 members, and by 2002,
the number increased to 2.3 million. From a figure of US $498 in 1976, the
bank's total disbursements increased to US $170.39 million in August 2002
(Refer Table II).
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The loan repayment rate was reported to be 95%. The
high repayment rate was probably a result of peer group pressure, and
the Grameen Bank's rule – that for availing of fresh loans, earlier
loans had to be repaid. Another important factor that led to high
repayments of loans was social pressure. When a member failed to repay
the installments, other members went to her home and demanded the
installments. Creditors'knocking at the door for loan repayments was
considered disgraceful among Bangladeshis. It is believed that the above
factors led to the success of Grameen Bank which also succeeded in
improving the lives of its members. |
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Many research studies indicate that Grameen Bank bought
positive changes in the lives of thousands of rural Bangladeshis. The landless
poor benefited the most from the Grameen Bank movement. The landless poor, who
earlier worked as agricultural laborers, acquired land for their own farming
activities after becoming Grameen Bank members. According to a World Bank study
conducted in 1994, Grameen Bank had improved the position of women in rural
Bangladesh.
Women members of Grameen Bank were more confident and socially aware than their
non-Grameen Bank counterparts. Grameen Bank members even took active part in
politics. In the 1997 local elections, more than 2,000 Grameen Bank women
members were elected to local civic bodies.
Grameen Bank also encouraged the rural poor to get educated. It provided
educational loans to its members to enable their children to go to school and
college. According to reports, the rate of school-going girls among Grameen Bank
member families was 57% higher than that in non-member families.
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TABLE II GROWTH OF BANGLADESH GRAMEEN BANK OVER THE YEARS
TESTING TIMES
QUESTIONS FOR DISCUSSION
EXHIBIT I ABOUT MICROFINANCE
EXHIBIT II WORLDWIDE REPLICATION OF GRAMEEN BANK
EXHIBIT III MAP OF BANGLADESH
EXHIBIT IV SIXTEEN DECISIONS OF GRAMEEN BANK
EXHIBIT V RELAXATIONS ANNOUNCED BY GRAMEEN BANK IN 1998
ADDITIONAL REFERENCES & READINGS
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