Micro Finance – An Innovative Solution to All Economic Problems
Rich get richer, poor get poorer..!
Income inequality and financial economic exclusion are the two toughest problems encountered, not only particular to any country; it is a world’s most dangerous problem. People die on hunger and poverty.
It is not because of non-availability of food, but it is because of unequal opportunities that seeds inequality among the people. In this blog, I have also written an article regarding the differences about capitalism and socialism kind of economic structure.
Karl Marx forecasted that capitalism is not a sustainable economic structure because it promotes inequality among people, opportunities for most of the working people are ignored for the benefit of few owners. He said Socialism is the only solution for all human economic problems and it directs us towards prosperity. In his book Das capital he claims that a sweeping revolution will happen which will throughout the capitalist people. Those revolutions will not happen suddenly but gradually in one form or other it will happen.
After Marx wrote those book, world have seen so many such revolution and struggles to move to a equal stateless class less society. Armed revolutionaries like Che Guevara, Fidel Castro, Mao se Tung, Ho chi Ming etc. wanted to impose those socialist policies of Marx in some altered way that can be adapted by their own countries. New philosophies emerged but for the same final goal, eradicating inequality and eliminate poverty.
In an economy the poor people wants not the Freebies, what they want is opportunities which they can utilize and develop in a dignified way. But the so called economic expert with the government wants to provide freebies and burden also the future generation with the government debt and additional taxes. This kind of policies will work for poll purpose and political advantages but it is not sustainable one which will help to eliminate poverty. A professor from Bangladesh swept the entire world through his work to eliminate poverty and develop the life of the poor people not only in his country but his work has become a benchmark for entire world to eliminate poverty and take the world to prosperity.
Professor .Muhammad Yunus of Bangladesh is the promoter of Grameen Foundation, which is nothing but a community development program that he did with his students when he was teaching. They went to a nearby village and wanted to know what they can do for the people in that village. Bangladesh is a Muslim majority country, so in that village men went for work women stayed at home. So whenever yunus and his students go there they can possibly meet only the women in that village. It is a practice in the Muslim society that women will not show their face or speak with strangers or men apart from their family.
So in their initial days of the community development work, they struggled to speak with the women. But somehow they managed to speak with the women slowly with his girl students. Then they found out money and financial assistance is what they want. At that time they were entirely depend on local money lenders. But they charge high interest, which will be at some time double the amount of principal they received. So Yunus and his students provided financial assistance as a part of the community development program. It went on well, the money were lent to women in that village they have used it, did some work and repaid it. It was all nothing but a success. So Yunus wanted it to spread to nearest villages too for the development of poor people. It requires a lot of financial strength for them to finance the large group of people. So he approached the nearest bank for financial assistance. He wanted the bank to care of the financial requirement of the people, but the bank said the poor people is not credit worthy. They are not capable of repaying the money. After long struggle Yunus could only get the same response from the banker’s side. So he came to a conclusion that..
“It is not the Poor People who are un creditworthy
But it is the Banks who are not People worthy”
So he created a foundation called “ Grameen Foundation”. Then it became a bank called “Grameen Bank”. Grameen bank started to lend money women self-help groups at reasonable interest rates.
They found things were working; the repayment rate is also very high. So with government assistance the Grameen bank model was spread throughout the Bangladesh. Grameen bank covers 95% of the Bengalese villages. This revolution of Mohammed yunus, spread across the world. And he conducted the first MICRO CREDIT SUMMIT in 1997.
Things were very much improving all over the world led to Yunus and Grameen bank receiving the NOBLE PRIZE for their in the year, 2006.
Prof. Mohammed Yunus , is a person no less than a revolutionary. He is equal to Marx and Guevara. His model of Micro financing has improved so many poor people lives.
In the next article I will write in detail about Micro finance model Grameen bank and about a book Autobiography of Mohammed yunus and Grameen bank: “Banker to the Poor”.
Prof. Dr. Mohammed Yunus is having selfless intentions to serve the people. But unfortunately that is missing with most of US.