Wednesday, February 13, 2013

Muhammad Yunus, The Founder of Microcredit



Have you ever wondered if you followed through with a great idea where it might go? Well, let me tell you about one of my friends who did just that.

Muhammad Yunus was an economics teacher in Bangaladesh. There had been a great flood up north and, day after day, he found people dying on his front porch. After a couple of days, he went to a small group of people close by and asked them how much money these 42 people would need to survive for one month. 

They figured it would be $26.00. He took the money out of his own pocket. He thought to himself, "Why am I teaching economics when so many people don't have any money?"

The next day, he went to a couple of banks and their responses were all the same: "We only work with people who have money, not those who don't have any." They would not make any loans. This man began to wonder if those who do not have any money could start with a tiny, tiny loan. They could pay the loan back and get a larger loan. Of course, the banks thought this was a crazy idea. So, he started the Grameen Bank. 

His idea turned into the microcredit system and today millions of women and their families are out of poverty. 

Their children can now afford to go to school.
I asked him, "But, weren't you afraid that the women who received the microcredit would not pay back their loans?" He smiled and said that 98% of all the loans have been paid back. Muhammad Yunus received the Nobel Prize in 2006 for his work.

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